JONES INTERCABLE INVESTORS L P, 10-K, 1996-03-28

JONES INTERCABLE INVESTORS L P
10-K, 1996-03-28
CABLE & OTHER PAY TELEVISION SERVICES

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<PAGE> 1
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from ____________ to _____________

Commission file number: 0-9287

JONES INTERCABLE INVESTORS, L.P.
------------------------------------------------------
(Exact name of registrant as specified in its charter)

Colorado 36-3468573
-------- ----------
(State of Organization) (IRS Employer Identification No.)

P.O. Box 3309, Englewood,
Colorado 80155-3309 (303) 792-3111
- ------------------------------- --------------
(Address of principal executive (Registrant's telephone no.
office and Zip Code) including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:
Limited Partnership Interests

Indicate by check mark whether the registrants, (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days:

Yes x No
----- -----

Aggregate market value of the voting stock held by non-affiliates of the
registrant: N/A

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (Section 229.405) is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.
-----

DOCUMENTS INCORPORATED BY REFERENCE: None

<PAGE> 2
PART I.

ITEM 1. BUSINESS

THE PARTNERSHIP. Jones Intercable Investors, L.P. (the "Partnership")
is a Colorado limited partnership that was formed to acquire, own and operate
cable television systems in the United States. Jones Intercable, Inc., a
Colorado corporation, is the general partner of the Partnership (the "General
Partner"). The Partnership was formed for the purpose of acquiring and
operating cable television systems. The Partnership owns the cable television
systems serving the areas in and around the City of Independence, Missouri
communities (the "Independence System). See Item 2.

CABLE TELEVISION SERVICES. The Independence System offers to
subscribers various types of programming, which include basic service, tier
service, premium service, pay-per-view programs and packages including several
of these services at combined rates.

Basic cable television service usually consists of signals of all four
national television networks, various independent and educational television
stations (both VHF and UHF) and certain signals received from satellites.
Basic service also usually includes programs originated locally by the system,
which may consist of music, news, weather reports, stock market and financial
information and live or videotaped programs of a public service or
entertainment nature. FM radio signals are also frequently distributed to
subscribers as part of the basic service.

The Independence System offers tier services on an optional basis to
its subscribers. A tier generally includes most of the cable networks such as
Entertainment and Sports Programming Network (ESPN), Cable News Network (CNN),
Turner Network Television (TNT), Family Channel, Discovery and others, and the
cable television operators buy tier programming from these networks. The
Independence System also offers a package that includes the basic service
channels and the tier services.

The Independence System also offers premium services to subscribers,
which consist of feature films, sporting events and other special features that
are presented without commercial interruption. The cable television operators
buy premium programming from suppliers such as HBO, Showtime, Cinemax or others
at a cost based on the number of subscribers the cable operator serves.
Premium service programming usually is significantly more expensive than the
basic service or tier service programming, and consequently cable operators
price premium service separately when sold to subscribers.

The Independence System also offers to subscribers pay-per-view
programming. Pay-per-view is a service that allows subscribers to receive
single programs, frequently consisting of motion pictures that have recently
completed their theatrical exhibitions and major sporting events, and to pay
for such service on a program-by-program basis.

REVENUES. Monthly service fees for basic, tier and premium services
constitute the major source of revenue for the Independence System. At
December 31, 1995, the Independence System's monthly basic service rate was
$8.64, monthly basic and tier ("basic plus") service rate was $23.57 and
monthly premium services ranged from $5.00 to $12.95 per premium service. In
addition, the Partnership earns revenues from the Independence System's
pay-per-view programs and advertising fees. Related charges may include a
nonrecurring installation fee that ranges from $10.00 to $30.00; however, from
time to time the Independence System has followed the common industry practice
of reducing or waiving the installation fee during promotional periods.
Commercial subscribers such as hotels, motels and hospitals are charged a
nonrecurring connection fee that usually covers the cost of installation.
Except under the terms of certain contracts with commercial subscribers and
residential apartment and condominium complexes, the subscribers are free to
discontinue the service at any time without penalty. For the year ended
December 31, 1995, of the total fees received by the Independence System, basic
service and tier service fees accounted for approximately 71% of total
revenues, premium service fees accounted for approximately 17% of total
revenues, pay-per-view fees were approximately 1% of total revenues,
advertising fees were approximately 3% of total revenues and the remaining 8%
of total revenues came

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principally from equipment rentals, installation fees and program guide sales.
The Partnership is dependent upon the timely receipt of service fees to provide
for maintenance and replacement of plant and equipment, current operating
expenses and other costs of the Independence System.

FRANCHISES. The Independence System is constructed and operated under
non-exclusive, fixed-term franchises or other types of operating authorities
(referred to collectively herein as "franchises") granted by local governmental
authorities. The Independence System's franchises require that franchise fees
generally based on gross revenues of the cable system be paid to the
governmental authority that granted the franchise, that certain channels be
dedicated to municipal use, that municipal facilities, hospitals and schools be
provided cable service free of charge and that any new cable plant be
substantially constructed within specific periods.

The Partnership holds 19 franchises relating to the Independence
System. These franchises provide for the payment of fees to the issuing
authorities and generally range from 3% to 5% of the gross revenues of a cable
television system. The 1984 Cable Act prohibits franchising authorities from
imposing annual franchise fees in excess of 5% of gross revenues and also
permits the cable television system operator to seek renegotiation and
modification of franchise requirements if warranted by changed circumstances.

The Partnership has never had a franchise revoked. The Partnership's
franchise expiration dates range from June 1996 to January 2001. The
Partnership is currently negotiating the renewal of the 2 franchises that will
expire prior to December 31, 1996, and the General Partner has no reason to
believe that such franchises will not be renewed in due course. The General
Partner recently has experienced lengthy negotiations with some franchising
authorities for the granting of franchise renewals. Some of the issues
involved in recent renewal negotiations include rate regulation, customer
service standards, cable plant upgrade or replacement and shorter terms of
franchise agreements.

COMPETITION. Cable television systems currently experience
competition from several sources. A potential source of significant
competition is Direct Broadcast Satellite ("DBS") services that use video
compression technology to increase channel capacity and provide packages of
movies, network and other program services that are competitive with those of
cable television systems. Two companies offering DBS services began operations
in 1994, and two other companies offering DBS service recently began
operations. In addition, a joint venture has won the right to provide a DBS
service through a FCC spectrum auction. Not all subscribers terminate cable
television service upon acquiring a DBS system. The General Partner has
observed that a number of DBS subscribers also elect to subscribe to cable
television service in order to obtain the greatest variety of programming on
multiple television sets, including local video services programming not
available through DBS service.

Although neither the Partnership nor the General Partner has yet
encountered competition from a telephone company providing video services as a
cable operator or video dialtone operator, it is anticipated that the cable
television systems owned or managed by the General Partner will face such
competition in the near future. Legislation recently enacted into law will
make it possible for companies with considerable resources to enter the
business. For example, in February 1996, one of the regional Bell operating
companies entered into an agreement to acquire the nation's third largest cable
television company. Additionally, several telephone companies have begun
seeking cable television franchises from local governmental authorities as a
consequence of litigation which successfully challenged the constitutionality
of the cable television/telephone company cross-ownership rules. The General
Partner cannot predict at this time when and to what extent telephone companies
will provide cable television service within service areas in competition with
cable television systems owned or managed by the General Partner.

The General Partner is aware of the following imminent competition
from telephone companies: Ameritech, one of the seven regional Bell operating
companies, which provides telephone service in a multi-state region including
Illinois, has just obtained a franchise that will allow it to provide cable
television service in Naperville, Illinois, a community currently served by a
cable system owned by another one of the public limited partnerships managed
by the General Partner. Chesapeake and Potomac Telephone Company of Virginia
and Bell Atlantic Video Service Company, both subsidiaries of Bell Atlantic,
another of the regional Bell operating companies, have announced their
intention to build a cable television system

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in Alexandria, Virginia in competition with a cable television system owned by
the General Partner. Bell Atlantic is preparing for the operation of a
telecommunications and video business in northern Virginia, including the
Alexandria metropolitan area. The FCC has granted GTE Virginia's application
for authority to construct, operate, own and maintain video dialtone facilities
in northern Virginia, including in the service area of a cable television
system owned by the General Partner. To date, GTE has not begun construction
of a video distribution system. The entry of telephone companies as direct
competitors could adversely affect the profitability and market value of the
General Partner's owned and managed systems.

Additional competition is present from several sources, including the
following: Master Antenna Television and Satellite Master Antenna Television
systems that serve multi-unit dwellings such as condominiums, apartment
complexes, motels, hotels and private residential communities; private cable
television/telephonic companies that have secured exclusive contracts to
provide video and telephony services to multi-unit dwellings and similar
complexes; and multichannel, multipoint distribution service ("MMDS") systems,
commonly called wireless cable which generally focus on providing service to
residents of rural areas. In addition, the FCC has established a new wireless
telecommunications service known as Personal Communications Service ("PCS")
that would provide portable non-vehicular mobile communications services
similar to that available from cellular telephone companies, but at a lower
cost. Several cable television multiple system operators hold or have
requested experimental licenses from the FCC to test PCS technology.

REGULATION AND LEGISLATION. The cable industry is regulated under the
Telecommunications Act of 1996 (the "1996 Act"), the Cable Television Consumer
Protection and Competition Act of 1992 (the "1992 Cable Act") and the Cable
Communications Policy Act of 1984 (the "1984 Cable Act") and the regulations
implementing these statutes. The Federal Communications Commission (the "FCC")
has promulgated regulations covering such areas as the registration of cable
television systems and other communications businesses, carriage of television
broadcast programming, consumer education and lockbox enforcement, origination
cablecasting and sponsorship identification, children's programming, the
regulation of basic cable and cable programming service rates in areas where
cable television systems are not subject to effective competition, signal
leakage and frequency use, technical performance, maintenance of various
records, equal employment opportunity, and antenna structure notification,
marking and lighting. In addition, cable operators periodically are required
to file various informational reports with the FCC. The FCC has the authority
to enforce these regulations through the imposition of substantial fines, the
issuance of cease and desist orders and/or the imposition of administrative
sanctions, such as the revocation of FCC licenses needed to operate certain
transmission facilities often used in connection with cable operations. State
or local franchising authorities, as applicable, also have the right to enforce
various regulations, impose fines or sanctions, issue orders or seek revocation
subject to the limitations imposed upon such franchising authorities by
federal, state and local laws and regulations. Several states have assumed
regulatory jurisdiction of the cable television industry, and it is anticipated
that other states will do so in the future. To the extent the cable television
industry begins providing telephone service, additional state regulations will
be applied to the cable television industry. Cable television operations are
subject to local regulation insofar as systems operate under franchises granted
by local authorities.

The following is a summary of federal laws and regulations materially
affecting the cable television industry, and a description of state and local
laws with which the cable industry must comply.

Telecommunications Act of 1996. The 1996 Act, which became law on
February 28, 1996, substantially revised the Communications Act of 1934, as
amended, including the 1984 Cable Act and the 1992 Cable Act, and has been
described as one of the most significant changes in communications regulation
since the original Communications Act of 1934. The 1996 Act is intended, in
part, to promote substantial competition in the telephone local exchange and in
the delivery of video and other services. As a result of the 1996 Act, local
telephone companies (also known as local exchange carriers or "LECs") and other
service providers are permitted to provide video programming, and cable
television operators are permitted entry into the telephone local exchange
market. The FCC is required to conduct rulemaking proceedings over the next
several months to implement various provisions of the 1996 Act.

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Among other provisions, the 1996 Act modified the 1992 Cable Act by
deregulating the cable programming service tier of large cable operators
effective March 31, 1999 and the cable programming service tier of small cable
operators (those that provide service to 50,000 or fewer subscribers) effective
immediately. The 1996 Act also revised the procedures for filing a cable
programming service tier rate complaint and adds a new effective competition
test.

The most far-reaching changes in the communications business will
result from the telephony provisions of the 1996 Act. The statute expressly
preempts any legal barriers to competition in the local telephone business that
previously existed in state and local laws and regulations. Many of these
barriers had been lifted by state actions over the last few years, but the 1996
Act completes the task. The 1996 Act also establishes new requirements for
maintaining and enhancing universal telephone service and new obligations for
telecommunications providers to maintain privacy of customer information. The
1996 Act establishes uniform requirements and standards for entry, competitive
carrier interconnection and unbundling of LEC monopoly services.

The 1996 Act repealed the cable television/telephone cross-ownership
ban adopted in the 1984 Cable Act. The federal cross-ownership ban was
particularly important to the cable industry because telephone companies
already own certain facilities such as poles, ducts and associated rights of
way. While this ban had been overturned by several courts, formal removal of
the ban ended the last legal constraints on telephone company plans to enter
the cable market. Under the 1996 Act, telephone companies in their capacity as
common carriers now may lease capacity to others to provide cable television
service. Telephone companies have the option of providing video service as
cable operators or through "open video systems" ("OVS"), a regulatory regime
that may provide more flexibility than traditional cable service. The 1996 Act
exempts OVS operators from many of the regulatory obligations that currently
apply to cable operators, such as rate regulation and franchise fees, although
other requirements are still applicable. OVS operators, although not subject
to franchise fees as defined by the 1992 Cable Act, are subject to fees charged
by local franchising authorities or other governmental entities in lieu of
franchise fees. (Under certain circumstances, cable operators also will be
able to offer service through open video systems.) In addition, the 1996 Act
eliminated the requirement that telephone companies file Section 214
applications (applications to provide video dialtone services) with the FCC
before providing video service. This limits the opportunity of cable operators
to mount challenges at the FCC regarding telephone company entry into the video
market. The 1996 Act also contains restrictions on buying out incumbent cable
operators in a telephone company's service area, especially in suburban and
urban markets.

Other parts of the 1996 Act also will affect cable operators. Under
the 1996 Act, the FCC is required to revise the current pole attachment rate
formula. This revision will result in an increase in the rates paid by
entities, including cable operators, that provide telecommunication services.
The rates will be phased in after a five-year period. (Cable operators that
provide only cable services will be unaffected.) Under the V-chip provisions
of the 1996 Act, cable operators and other video providers are required to pass
along any program rating information that programmers include in video signals.
Cable operators also are subject to new scrambling requirements for sexually
explicit programming, and cable operators that provide Internet access or other
online services are subject to the new indecency limitations for computer
services. In addition, cable operators that provide Internet access or other
online services are subject to the new indecency limitations for computer
services, although these provisions already have been challenged in court, and
the courts have preliminarily enjoined the enforcement of these content-based
provisions.

Under the 1996 Act, a franchising authority may not require a cable
operator to provide telecommunications services or facilities, other than an
institutional network, as a condition to a grant, renewal or transfer of a
cable franchise, and franchising authorities are preempted from regulating
telecommunications services provided by cable operators and from requiring
cable operators to obtain a franchise to provide such services. The 1996 Act
also repealed the 1992 Cable Act's anti-trafficking provision, which generally
required the holding of cable television systems for three years.

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It is premature to predict the specific effects of the 1996 Act on the
cable industry in general or the Partnership in particular. The FCC shortly
will be undertaking numerous rulemaking proceedings to interpret and implement
the 1996 Act. It is not possible at this time to predict the outcome of those
proceedings or their effect on the Partnership.

Cable Television Consumer Protection and Competition Act of 1992. The
1992 Cable Act, which became effective on December 4, 1992, caused significant
changes to the regulatory environment in which the cable television industry
operates. The 1992 Cable Act generally mandated a greater degree of regulation
of the cable television industry. Under the 1992 Cable Act's definition of
effective competition, nearly all cable television systems in the United
States, including those owned and managed by the General Partner, became
subject to rate regulation of basic cable services. In addition, the 1992
Cable Act allowed the FCC to regulate rates for non-basic service tiers other
than premium services in response to complaints filed by franchising
authorities and/or cable subscribers. In April 1993, the FCC adopted
regulations governing rates for basic and non-basic services. The FCC's rules
became effective on September 1, 1993.

In compliance with these rules, the General Partner on behalf of the
Partnership reduced rates charged for certain regulated services in the
Partnership's cable systems effective September 1, 1993. These reductions
resulted in some decrease in Partnership revenues and operating income before
depreciation and amortization; however, the decrease was not as severe as
originally anticipated. The General Partner has undertaken actions to mitigate
a portion of these reductions primarily through (a) new service offerings in
some systems, (b) product re-marketing and re-packaging and (c) marketing
efforts directed at non-subscribers.

On February 22, 1994, however, the FCC adopted several additional rate
orders including an order which revised its earlier-announced regulatory scheme
with respect to rates. The FCC's new regulations generally required rate
reductions, absent a successful cost-of-service showing, of 17 percent of
September 30, 1992 rates, adjusted for inflation, channel modifications,
equipment costs, and increases in programming costs. Further rate reductions
for cable systems whose rates are below the revised benchmark levels, as well
as reductions that would require operators to reduce rates below benchmark
levels in order to achieve a 17 percent rate reduction, were held in abeyance
pending completion of cable system cost studies. The FCC recently requested
some of these "low price" systems to complete cost study questionnaires. After
review of these questionnaires, the FCC could decide to permanently defer any
further rate reductions, or require the additional 7 percent rate roll back for
some or all of these systems. The FCC has also adopted its proposed upgrade
methodology by which operators would be permitted to recover the costs of
upgrading their plant.

After analyzing the effects of the two methods of rate regulation, the
General Partner elected to file cost-of-service showings for the Independence
System. The General Partner thus anticipates no further reduction in revenues
or operating income before depreciation and amortization resulting from the
FCC's rate regulations. At this time, however, the regulatory authorities have
not yet approved the cost-of-service showings, and there can be no assurance
that the Partnership's cost-of-service showings will prevent further rate
reductions by the Independence System until such final approval is received.

On November 10, 1994, the FCC also announced a revision to its
regulations governing the manner in which cable operators may charge
subscribers for new cable programming services. In addition to the present
formula for calculating the permissible rate for new services, the FCC
instituted a three-year flat fee mark-up plan for charges relating to new
channels of cable programming services. Commencing on January 1, 1995, cable
system operators may charge for new channels of cable programming services
added after May 14, 1994 at a rate of up to 20 cents per channel, but may not
make adjustments to monthly rates totaling more than $1.20 plus an additional
30 cents for programming license fees per subscriber over the first two years
of the three-year period for these new services. Operators may charge an
additional 20 cents in the third year only for channels added in that year plus
the costs for the programming. Operators electing to use the 20 cent per
channel adjustment may not also take a 7.5 percent mark-up on programming cost
increases, which is permitted under the FCC's current rate regulations. The
FCC has requested further comment as to whether cable operators should continue
to receive the 7.5 percent mark-up on increases in license fees on existing
programming services.

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The FCC also announced that it will permit operators to offer a "new
product tier" ("NPT"). Operators will be able to price the NPT as they elect
so long as, among other conditions, other channels that are subject to rate
regulation are priced in conformity with applicable regulations and operators
do not remove programming services from existing tiers and offer them on the
NPT.

In September 1995, the FCC authorized a new, alternative method of
implementing rate adjustments which will allow cable operators to increase
rates for programming annually on the basis of projected increases in external
costs (inflation, costs for programming, franchise-related obligations and
changes in the number of regulated channels) rather than on the basis of cost
increases incurred in the preceding calendar quarter. Operators that elect not
to recover all of their accrued external costs and inflation pass-throughs each
year may recover them (with interest) in subsequent years.

In December 1995, the FCC adopted final cost-of-service rate
regulations requiring, among other things, cable operators to exclude 34
percent of system acquisition costs related to intangible and tangible assets
used to provide regulated services. The FCC also reaffirmed the industry-wide
11.25 percent after tax rate of return on an operator's allowable rate base,
but initiated a further rulemaking in which it proposes to use an operator's
actual debt cost and capital structure to determine an operator's cost of
capital or rate of return. After a rate has been set pursuant to a
cost-of-service showing, rate increases for regulated services are indexed for
inflation, and operators are permitted to increase rates in response to
increases in costs beyond their control, such as taxes and increased
programming costs.

The United States Court of Appeals for the District of Columbia
Circuit recently upheld the FCC's rate regulations implemented pursuant to the
1992 Cable Act, but ruled that the FCC impermissibly failed to permit cable
operators to adjust rates for certain cost increases incurred during the period
between the date the 1992 Cable Act was passed through the initial date of rate
regulation. The FCC has not yet implemented the court's ruling.

There have been several lawsuits filed by cable operators and
programmers in federal court challenging various aspects of the 1992 Cable Act
including its provisions relating to mandatory broadcast signal carriage,
retransmission consent, access to cable programming, rate regulations,
commercial leased channels and public access channels. On April 8, 1993, a
three-judge federal district court panel issued a decision upholding the
constitutionality of the mandatory signal carriage requirements of the 1992
Cable Act. That decision was appealed directly to the United States Supreme
Court. The United States Supreme Court vacated the lower court decision on
June 27, 1994 and remanded the case to the district court for further
development of a factual record. On December 12, 1995, the three-judge federal
district court again upheld the must-carry rules' validity. This decision has
been appealed to the United States Supreme Court.

In 1993, a federal district court upheld provisions of the 1992 Cable
Act concerning rate regulation, retransmission consent, restrictions on
vertically integrated cable television operators and programmers, mandatory
carriage of programming on commercial leased channels and public, educational
and governmental access channels and the exemption for municipalities from
civil damage liability arising out of local regulation of cable services. The
1992 Cable Act's provisions providing for multiple ownership limits for cable
operators and advance notice of free previews for certain programming services
have been found unconstitutional and these decisions have been appealed. The
FCC's regulations relating to the carriage of indecent programming, which were
recently upheld by the United States Court of Appeals for the District of
Columbia, have been appealed to the United States Supreme Court.

Franchising. The responsibility for franchising or other
authorization of cable television systems is left to state and local
authorities. There are, however, several provisions in the 1984 Cable Act that
govern the terms and conditions under which cable television systems provide
service. These include uniform standards and policies that are applicable to
cable television operators seeking renewal of a cable television franchise.
The procedures established provide for a formal renewal process should the
franchising authority and the cable television operator decline to use an
informal procedure. A franchising authority unable to make a preliminary
determination to renew a franchise is required to hold a hearing in which the
operator has the right to participate.

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In the event a determination is made not to renew the franchise at the
conclusion of the hearing, the franchising authority must provide the operator
with a written decision stating the specific reasons for non-renewal.
Generally, the franchising authority can finally decide not to renew a
franchise only if it finds that the cable operator has not substantially
complied with the material terms of the present franchise, has not provided
reasonable service in light of the community's needs, does not have the
financial, legal or technical ability to provide the services being proposed
for the future, or has not presented a reasonable proposal for future service.
A final decision of non-renewal by the franchising authority is appealable in
court.

A provision of the 1996 Act preempts franchising authorities from
regulating telecommunications services provided by cable operators and from
requiring cable operators to obtain a franchise to provide such services. A
franchising authority may not require a cable operator to provide
telecommunications services or facilities, other than an institutional network,
as a condition to a grant, renewal or transfer of a cable franchise.

GENERAL. The Partnership's business consists of providing cable
television services to a large number of customers, the loss of any one of
which would have no material effect on the Partnership's business. The
Independence System has had some subscribers who later terminated the service.
Terminations occur primarily because people move to another home or to another
city. In other cases, people terminate on a seasonal basis or because they no
longer can afford or are dissatisfied with the service. The amount of past due
accounts in the Independence System is not significant. The General Partner's
policy with regard to past due accounts is basically one of disconnecting
service before a past due account becomes material.

The Partnership does not depend to any material extent on the
availability of raw materials; it carries no significant amounts of inventory
and it has no material backlog of customer orders. The Partnership has no
employees because all properties are managed by employees of Intercable.
Intercable has engaged in research and development activities relating to the
provision of new services but the amount of the Partnership's funds expended
for such research and development has never been material.

Compliance with federal, state and local provisions that have been
enacted or adopted regulating the discharge of materials into the environment
or otherwise relating to the protection of the environment has had no material
effect upon the capital expenditures, earnings or competitive position of the
Partnership.

ITEM 2. PROPERTIES

The Partnership acquired the Independence System in May 1987. The
following sets forth (i) the monthly basic plus service rates charged to
subscribers and (ii) the number of basic subscribers and pay units for the
Independence System. The monthly basic service rates set forth herein
represent, with respect to systems with multiple headends, the basic service
rate charged to the majority of the subscribers within the Independence System.
In cable television systems, basic subscribers can subscribe to more than one
pay TV service. Thus, the total number of pay services subscribed to by basic
subscribers are called pay units. As of December 31, 1995, the Independence
System operated cable plant passing approximately 131,800 homes, representing
an approximate 63% penetration rate. Figures for numbers of subscribers and
homes passed are compiled from the General Partner's records and may be subject
to adjustments.

<TABLE>
<CAPTION>
At December 31,
----------------------------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Monthly basic plus service rate $ 23.57 $ 22.32 $ 22.32
Basic subscribers 83,722 79,985 75,117
Pay units 57,235 52,630 55,425
</TABLE>

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ITEM 3. LEGAL PROCEEDINGS

On February 22, 1994, the General Partner and The Jones Group, Ltd.
(the "Jones Group"), a subsidiary of the General Partner engaged in the cable
television system brokerage business, were named as defendants in a lawsuit
brought by three individuals who are Class A Unitholders in the Partnership.
The litigation, entitled Luva Vaughan et al v. Jones Intercable, Inc. et al,
Case No. CV 94-3652, was filed in the Circuit Court for Jackson County,
Missouri, and purports to be "for the use and benefit of" the Partnership. As
originally filed, the suit sought rescission of the sale of the Alexandria,
Virginia cable television system (the "Alexandria System") by the Partnership
to the General Partner, which sale was completed on November 2, 1992. It also
sought a constructive trust on the profits derived from the operation of the
Alexandria System since the date of the sale and an accounting and other
equitable relief. The plaintiffs also alleged that the $1,800,000 commission
paid to Jones Group by the Partnership in connection with such sale was
improper, and asked the Court to order that such commission be repaid to the
Partnership.

Under the terms of the partnership agreement of the Partnership, the
General Partner has the right to acquire cable television systems from the
Partnership at a purchase price equal to the average of three independent
appraisals of the cable television system to be acquired. The plaintiffs claim
that the appraisals obtained in connection with the sale of the Alexandria
System were improperly obtained, were not made by qualified appraisers and were
otherwise improper. The purchase price paid by the General Partner upon such
sale was approximately $73,200,000. The amount of damages being sought by the
plaintiffs has not been specified.

On October 21, 1994, plaintiffs filed a motion to dismiss Jones Group
in response to Jones Group's argument that Missouri lacked personal
jurisdiction over it. Plaintiffs' motion was granted, and plaintiffs then
filed an action in Colorado against Jones Group seeking a return of the
brokerage commission.

The General Partner and Jones Group filed motions for summary judgment
in the Missouri and Colorado cases, respectively. The Missouri court granted
the General Partner's motion in part and dismissed all counts of the complaint
for rescission. It also struck the plaintiffs' jury demand. The Colorado
court also granted Jones Group's motion in part finding that the payment of the
brokerage commission was not a breach of the partnership agreement, but leaving
for trial the issue of whether such payment constituted a breach of fiduciary
duty.

Subsequently, the plaintiffs have filed an amended complaint in the
Missouri case, recasting their allegations in terms of breach of contract,
common law fraud, conversion and breach of fiduciary duty. The plaintiffs have
reasserted their right to a jury trial. On October 4, 1995, the Court granted
the General Partner's motion for summary judgment on the common law fraud,
conversion and breach of fiduciary duty claims and also struck plaintiffs'
demand for a jury trial. As a result, there is only one remaining substantive
claim (breach of contract); no claim for punitive damages; and the trial will
be to the Court commencing on April 29, 1996.

On October 25, 1995, plaintiffs and Jones Group filed, in the Colorado
action, a joint motion to stay the Colorado action until the resolution of the
Missouri action. The motion to stay is pending before the Colorado court.

The General Partner has conducted written discovery in the form of
interrogatories and requests for production of documents; has noticed the
depositions of plaintiffs and plaintiffs' expert and has retained an expert to
testify that the three appraisals were performed in accordance with standard
appraisal methodologies. Although plaintiffs have retained an "expert"
appraiser to testify that the value of the Alexandria System in November 1992
was $85 million, approximately $12 million more than the purchase price, the
General Partner believes both that the purchase price was fair and that the
brokerage commission was properly paid to Jones Group in accordance with the
express terms of the partnership agreement. Consequently, the General Partner
intends to defend the litigation at trial in April 1996.

9
<PAGE> 10
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

PART II.

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK
AND RELATED SECURITY HOLDER MATTERS

The Partnership's Class A Units are traded on the American Stock
Exchange ("AMEX") under the symbol JTV.

The following table shows the high and low prices as regularly quoted
on AMEX for each quarterly period of 1995 for the Partnership's Class A Units:

<TABLE>
<CAPTION>
Year Ended 12/31/95 High Low
------------------- ---- -----
<S> <C> <C>
First Quarter 12 10 7/8
Second Quarter 11 7/8 10 3/8
Third Quarter 13 7/8 11
Fourth Quarter 13 11 5/8
</TABLE>

At February 15, 1996, there were 1,437 record holders of the Class A
Units of the Partnership and 8,322,632 outstanding Class A Units.

The Partnership distributed $.15 per Class A Unit for each of the
calendar quarters in 1995. See Note 4 of the Notes to Financial Statements for
discussion of the Partnership's cash distribution policy.

10
<PAGE> 11

ITEM 6. SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
For the Year Ended December 31,
-------------------------------------------------------------------------------------
1995 1994 1993 1992 1991
-------------- --------------- --------------- -------------- --------------

<S> <C> <C> <C> <C> <C>
Revenues $29,865,310 $27,522,625 $26,955,292 $38,337,748 $38,468,689
Operating Expenses 15,044,764 13,757,025 13,021,954 18,635,695 18,898,291
Management Fees and Allocated
Overhead from General Partner 3,631,737 3,450,694 3,228,652 4,459,714 4,270,969
Depreciation and Amortization 7,881,118 8,351,439 9,793,347 15,051,597 17,478,720
Operating Income (Loss) 3,307,691 1,973,467 911,339 190,742 (2,179,291)
Net Income (Loss) 794,431 578,056 (57,867) 44,060,105* (7,224,785)
Net Income (Loss) per Class A Unit .09 .07 (.01) 5.24 (.86)
Distributions per Class A Unit .60 .60 .60 3.60 .60
Weighted Average Number of
Class A Units Outstanding 8,322,632 8,322,632 8,322,632 8,322,632 8,322,632
General Partner's Deficit (8,744) (16,688) (22,469) (21,890) (462,491)
Class A Unitholders' Capital 17,809,017 22,016,109 26,437,414 31,488,281 17,830,251
Total Assets 48,075,513 48,557,818 48,163,431 52,648,591 86,267,379
Total Debt 26,761,696 23,493,841 19,029,472 18,570,003 63,986,995
</TABLE>

*Includes gain on sale of Alexandria System of $47,118,868 during November
1992.

Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations

RESULTS OF OPERATIONS

1995 compared to 1994

Revenues of the Partnership increased $2,342,685, or approximately 9
percent, to $29,865,310 in 1995 from $27,522,625 in 1994. The increase in
revenues in the Independence System is primarily a result of increases in the
number of basic service subscribers and basic service rate increases. An
increase in the subscriber base accounted for approximately 53 percent of the
increase in revenues for 1995. Basic subscribers increased by 3,737
subscribers, or approximately 5 percent, to 83,722 at December 31, 1995 from
79,985 at December 31, 1994. Basic service rate increases accounted for
approximately 41 percent of the increase in revenues for 1995. No other
individual factor was significant to the increase in revenues.

Operating expenses consist primarily of costs associated with the
administration of the Partnership's cable television system. The principal
cost components are salaries paid to system personnel, programming expenses,
professional fees, subscriber billing costs, rent for leased facilities, cable
system maintenance expenses and consumer marketing expenses.

Operating expenses increased $1,287,739, or approximately 9 percent,
to $15,044,764 in 1995 from $13,757,025 in 1994. Operating expenses
represented approximately 52 percent and 50 percent of revenues in 1995 and
1994, respectively. This increase was due primarily to increases in
programming-related costs, which were partially offset by a decrease in
personnel costs. No other individual factor was significant to the increase in
operating expenses in the Partnership's Independence System.

Management fees and allocated overhead from the General Partner
increased $181,043, or approximately 5 percent, to $3,631,737 in 1995 from
$3,450,694 in 1994. This increase was due primarily to the increase in
revenues, upon which such fees and allocations are based.

Depreciation and amortization expense decreased $470,321, or
approximately 6 percent, to $7,881,118 in 1995 from $8,351,439 in 1994. This
decrease was due to the maturation of the Independence System's intangible
asset base.

11
<PAGE> 12

Operating income increased $1,344,224, or approximately 68 percent, to
$3,307,691 in 1995 from $1,963,467 in 1994. This increase was due to the
decrease in depreciation and amortization expense and to the increase in
revenues exceeding the increases in operating expenses and management fees and
allocated overhead from the General Partner.

The cable television industry generally measures the financial
performance of a cable television system in terms of cash flow or operating
income before depreciation and amortization. The value of a cable television
system is often determined using multiples of cash flow. This measure is not
intended to be a substitute or improvement upon the items disclosed on the
financial statements, rather it is included because it is an industry standard.
Operating income before depreciation and amortization increased $873,903, or
approximately 8 percent, to $11,188,809 in 1995 from $10,314,906 in 1994. This
increase was due to the increases in revenues exceeding the increases in
operating expenses and management fees and allocated overhead from the General
Partner.

Interest expense increased $636,968, or approximately 49 percent, to
$1,926,459 in 1995 from $1,289,491 in 1994. This increase was due to higher
outstanding balances on interest bearing obligations and to higher interest
rates in 1995 as compared to 1994.

Net income increased $216,375, or approximately 37 percent, to
$794,431 in 1995 from $578,056 in 1994. This increase was due to the factors
discussed above.

1994 compared to 1993

Partnership revenues increased $567,333, or approximately 2 percent,
to $27,522,625 in 1994 from $26,955,292 in 1993. This increase was primarily
the result of increases in basic service subscribers. The Independence System
added 4,868 basic service subscribers in 1994, an increase of approximately 6
percent. Basic service subscribers for the Independence System totaled 75,117
at December 31, 1993 compared to 79,985 at December 31, 1994. The increase in
revenues would have been greater but for the reduction in basic service rates
due to regulations issued by the FCC in April 1993 with which the Partnership
complied effective September 1, 1993.

Operating expenses increased $735,071, or approximately 6 percent, to
$13,757,025 in 1994 from $13,021,954 in 1993. Operating expenses represented
approximately 50 percent and 48 percent of revenues in 1994 and 1993,
respectively. This increase in operating expenses was primarily due to an
increase in programming costs, which accounted for approximately 80 percent of
the total increase. No other individual factor was significant to the increase
in operating expenses.

Management fees and allocated overhead from the General Partner
increased $222,042, or approximately 7 percent, to $3,450,694 in 1994 from
$3,228,652 in 1993 due primarily to increases in allocated expenses from the
General Partner. The General Partner experienced increases in expenses in
1994.

Depreciation and amortization expense decreased $1,441,908, or
approximately 15 percent, to $8,351,439 in 1994 from $9,793,347 in 1993. This
decrease was due to the maturation of the Independence System's asset base.

Operating income increased $1,052,128, to $1,963,467 in 1994 from
$911,339 in 1993. This increase was due to the decrease in depreciation and
amortization expense and to the increase in revenues exceeding the increases in
operating expenses and management fees and allocated overhead from the General
Partner.

Operating income before depreciation and amortization decreased
$389,780, or approximately 4 percent, to $10,314,906 in 1994 from $10,704,686
in 1993. This decrease was due to the increases in operating expense and
allocated overhead from the General Partner exceeding the increase in revenues.

Interest expense increased $310,867, or approximately 32 percent, to
$1,289,491 in 1994 from $978,624 in 1993 due to higher interest rates and
higher average outstanding balances on interest bearing obligations in 1994.

The Partnership reported a net income of $578,056 in 1994 compared to
a net loss of $57,867 in 1993. The change was due to the factors discussed
above.

12
<PAGE> 13

FINANCIAL CONDITION

The Partnership's capital expenditures for 1995 totaled approximately
$7,124,000. Approximately 55 percent of these expenditures related to the
extension and rebuild of cable plant. Service drops to homes accounted for
approximately 37 percent of such expenditures. The remainder of the capital
expenditures related to various enhancements in the Partnership's Independence
System. Funding for these expenditures was provided primarily by cash
generated from operations and borrowings from the Partnership's revolving
credit facility.

Anticipated capital expenditures for 1996 are approximately
$9,692,000. The continuation of the rebuild of the Independence System is
expected to account for approximately 52 percent of the anticipated capital
expenditures. Service drops connecting new subscribers are expected to account
for approximately 28 percent. The remainder of the expenditures will relate to
various enhancements in the Independence System. Funding for these capital
improvements is expected to be provided by cash generated from operations and
borrowings from the Partnership's revolving credit facility.

The maximum amount available under the Partnership's revolving credit
facility is subject to the terms of the credit agreement and the partnership
agreement's leverage limitations discussed below. The maximum amount available
under the Partnership's revolving credit facility is $35,000,000. As of
December 31, 1995, $26,450,000 was outstanding, leaving $8,550,000 of available
borrowings for future needs. Under the terms of the agreement, the revolving
credit facility will expire on December 31, 1996. However, the General Partner
expects to negotiate an extension of the revolving credit period. Interest on
outstanding principal balances is at the Partnership's option of the Prime Rate
plus .25 percent, the Certificate of Deposit Rate plus 1.25 percent or the
Euro-rate plus 1.25 percent. The effective interest rates on amounts
outstanding as of December 31, 1995 and 1994 were 7.25 percent and 7.09
percent, respectively.

The level of borrowings allowed by the Partnership's limited
partnership agreement is 25 percent of the fair market value of the
Partnership's assets at the time of borrowing or 25 percent of the cost of the
Partnership's assets at the time of borrowing, whichever is higher. This
limitation may restrict the Partnership's ability to borrow funds for capital
expenditures and to make distributions. In addition, such limitation may
reduce the financial flexibility and liquidity of the Partnership. Further,
the payment of the principal and interest on outstanding debt obligations will
diminish the level of funds available to the Partnership and reduce the
financial flexibility of the Partnership. The Partnership's most recent
appraisal of the Independence System was $167,065,000. Based upon this
appraised value, the Partnership has a borrowing capacity of approximately
$41,000,000, which would allow the Partnership to borrow the maximum amount
($35,000,000) currently available under its credit facility.

The Partnership declared a $.15 per unit distribution for each of the
four quarters of 1995. The Partnership intends to distribute all cash flow
from operations after payment of expenses, capital additions and creation of
cash reserves deemed reasonably necessary to preserve and enhance the value of
the Partnership's cable television system. The General Partner believes that
the Partnership has sufficient sources of capital to service its presently
anticipated needs from cash on hand, cash generated from operations and
borrowings available under its revolving credit facility.

13
<PAGE> 14

REGULATION AND LEGISLATION

The Partnership has filed a cost-of-service showing in response to
rulemakings concerning the 1992 Cable Act for its Independence System and thus
anticipates no further reductions in rates in this system. The cost-of-service
showing has not yet received final approvals from regulatory authorities,
however, and there can be no assurance that the Partnership's cost-of-service
showing will prevent further rate reductions in the Independence System until
such final approval is received.

The Telecommunications Act of 1996 (the "1996 Act"), which became law
on February 8, 1996, substantially revised the Communications Act of 1934, as
amended, including the 1984 Cable Act and the 1992 Cable Act, and has been
described as one of the most significant changes in communications regulation
since the original Communications Act of 1934. The 1996 Act is intended, in
part, to promote substantial competition in the telephone local exchange and in
the delivery of video and other services. As a result of the 1996 Act, local
telephone companies (also known as local exchange carriers or "LECs") and other
service providers are permitted to provide video programming, and cable
television operators are permitted entry into the telephone local exchange
market. The FCC is required to conduct rulemaking proceedings over the next
several months to implement various provisions of the 1996 Act.

Among other provisions, the 1996 Act modified the 1992 Cable Act by
deregulating the cable programming service tier of large cable operators
including the Partnership effective March 31, 1999 and the cable programming
service tier of "small" cable operators in systems providing service to 50,000
or fewer subscribers effective immediately. The 1996 Act also revised the
procedures for filing cable programming service tier rate complaints and adds a
new effective competition test.

It is premature to predict the specific effects of the 1996 Act on the
cable industry in general or the Partnership in particular. The FCC will be
undertaking numerous rulemaking proceedings to interpret and implement the 1996
Act. It is not possible at this time to predict the outcome of those
proceedings or their effect on the Partnership. See Item 1.

14
<PAGE> 15

Item 8. Financial Statements

JONES INTERCABLE INVESTORS, L.P.

FINANCIAL STATEMENTS

AS OF DECEMBER 31, 1995 AND 1994

INDEX
-----

<TABLE>
<CAPTION>
3 Page
----

<S> <C>
Report of Independent Public Accountants 16

Balance Sheets 17

Statements of Operations 19

Statements of Partners' Capital (Deficit) 20

Statements of Cash Flows 21

Notes to Financial Statements 22
</TABLE>

15
<PAGE> 16

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Partners of Jones Intercable Investors, L.P.:

We have audited the accompanying balance sheets of JONES INTERCABLE INVESTORS,
L.P. (a Colorado limited partnership) of December 31, 1995 and 1994, and the
related statements of operations, partners' capital (deficit) and cash flows
for each of the three years in the period ended December 31, 1995. These
financial statements are the responsibility of the General Partner's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Jones Intercable Investors,
L.P. as of December 31, 1995 and 1994, and the results of its operations and
its cash flows for each of the three years in the period ended December 31,
1995, in conformity with generally accepted accounting principles.

/s/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP

Denver, Colorado,
March 8, 1996.

16
<PAGE> 17

JONES INTERCABLE INVESTORS, L.P.
(A Limited Partnership)

BALANCE SHEETS

<TABLE>
e<CAPTION>
December 31,
-------------------------------------

ASSETS 1995 1994
------ ---------------- ----------------

<S> <C> <C>
CASH $ 91,518 $ 607,422

TRADE RECEIVABLES, less allowance for doubtful
receivables of $82,938 and $76,659 at
December 31, 1995 and 1994, respectively 1,378,312 741,315

INVESTMENT IN CABLE TELEVISION PROPERTIES:
Property, plant and equipment, at cost 67,139,530 60,015,800
Less- accumulated depreciation (29,510,807) (25,208,198)
----------- -----------
37,628,723 34,807,602

Franchise costs, net of accumulated amortization of
$39,222,224 and $35,793,356 at December 31, 1995
and 1994, respectively 8,629,085 12,057,953
Costs in excess of interests in net assets purchased, net of
accumulated amortization of $53,814 and $47,562 at
December 31, 1995 and 1994, respectively 196,187 202,439
------------ ------------

Total investment in cable
television properties 46,453,995 47,067,994

DEPOSITS, PREPAID EXPENSES AND DEFERRED CHARGES 151,688 141,087
------------ ------------

Total assets $ 48,075,513 $ 48,557,818
=========== ===========
</TABLE>

The accompanying notes to financial statements
are an integral part of these balance sheets.

17
<PAGE> 18

JONES INTERCABLE INVESTORS, L.P.
(A Limited Partnership)

BALANCE SHEETS

<TABLE>
<CAPTION>
December 31,
--------------------------------------

LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) 1995 1994
------------------------------------------- ---------------- ----------------

<S> <C> <C>
LIABILITIES:
Credit facility $ 26,450,000 $ 23,000,000
Capital lease obligations 311,696 493,841
Accounts payable 79,476 5,381
Accrued distributions to Class A Unitholders 1,248,395 1,248,395
Accrued liabilities 2,067,516 1,685,890
Subscriber prepayments 118,157 124,890
------------ ------------

Total liabilities 30,275,240 26,558,397
----------- -----------

COMMITMENTS AND CONTINGENCIES (Note 8)

PARTNERS' CAPITAL (DEFICIT):
General Partner-
Contributed capital 1,000 1,000
Accumulated deficit (9,744) (17,688)
------------- ------------

(8,744) (16,688)
------------- ------------

Class A Unitholders-
Net contributed capital
(8,322,632 units outstanding
at December 31, 1995 and 1994) 116,433,492 116,433,492
Accumulated deficit (964,692) (1,751,179)
Distributions to Unitholders (97,659,783) (92,666,204)
----------- -----------

17,809,017 22,016,109
----------- -----------

Total liabilities and
partner)' capital (deficit $ 48,075,513 $ 48,557,818
=========== ===========
</TABLE>

The accompanying notes to financial statements
are an integral part of these balance sheets.

18
<PAGE> 19

JONES INTERCABLE INVESTORS, L.P.
(A Limited Partnership)

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
For the Year Ended December 31,
------------------------------------------------

1995 1994 1993
-------------- -------------- --------------

<S> <C> <C> <C>
REVENUES $29,865,310 $27,522,625 $26,955,292

COSTS AND EXPENSES:
Operating expenses 15,044,764 13,757,025 13,021,954
Management fees and allocated
overhead from General Partner 3,631,737 3,450,694 3,228,652
Depreciation and amortization 7,881,118 8,351,439 9,793,347
---------- ---------- ----------

OPERATING INCOME 3,307,691 1,963,467 911,339
---------- ---------- -----------

OTHER INCOME (EXPENSE):
Interest expense (1,926,459) (1,289,491) (978,624)
Interest income 6,274 7,899 17,232
Other, net (593,075) (103,819) (7,814)
----------- ----------- -----------

Total other income (expense) (2,513,260) (1,385,411) (969,206)
----------- ----------- -----------

NET INCOME (LOSS) $ 794,431 $ 578,056 $ (57,867)
=========== =========== ===========

ALLOCATION OF NET INCOME (LOSS):
General Partner $ 7,944 $ 5,781 $ (579)
=========== ============ ===========

Class A Unitholders $ 786,487 $ 572,275 $ (57,288)
=========== ============ ===========

NET INCOME (LOSS) PER CLASS A UNIT $ .09 $ .07 $ (.01)
=========== ============ ===========

WEIGHTED AVERAGE NUMBER OF CLASS A
UNITS OUTSTANDING 8,322,632 8,322,632 8,322,632
=========== ============ ==========
</TABLE>

The accompanying notes to financial statements
are an integral part of these statements.

19
<PAGE> 20

JONES INTERCABLE INVESTORS, L.P.
(A Limited Partnership)

STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)

<TABLE>
<CAPTION>
For the Year Ended December 31,
--------------------------------------------------------

1995 1994 1993
-------------- -------------- --------------

<S> <C> <C> <C>
General Partner:
Balance, beginning of year $ (16,688) $ (22,469) $ (21,890)
Net income (loss) for year 7,944 5,781 (579)
------------ ------------ -------------

Balance, end of year $ (8,744) $ (16,688) $ (22,469)
============= ============ ============

Class A Unitholders:
Balance, beginning of year $22,016,109 $26,437,414 $31,488,281
Net income (loss) for year 786,487 572,275 (57,288)
Distributions to Unitholders (4,993,579) (4,993,580) (4,993,579)
------------- ------------ -------------

Balance, end of year $ 17,809,017 $ 22,016,109 $ 26,437,414
============= ============ =============
</TABLE>

The accompanying notes to financial statements
are an integral part of these statements.

20
<PAGE> 21

JONES INTERCABLE INVESTORS, L.P.
(A Limited Partnership)

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
For the Year Ended December 31,
---------------------------------------------------

1995 1994 1993
-------------- -------------- --------------

<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 794,431 $ 578,056 $ (57,867)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization 7,881,118 8,351,439 9,793,347
Decrease (increase) in trade receivables (636,997) 13,003 (78,165)
Increase in deposits, prepaid expenses
and deferred charges (153,990) (66,526) (98,521)
Increase in accounts payable, accrued
liabilities and subscriber prepayments 448,988 345,542 106,817
---------- ---------- ----------

Net cash provided by operating activities 8,333,550 9,221,514 9,665,611
---------- ---------- ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net (7,123,730) (8,451,389) (4,808,539)
---------- ---------- ----------

Net cash used in investing activities (7,123,730) (8,451,389) (4,808,539)
---------- ---------- ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 4,878,614 7,064,889 2,414,551
Repayment of debt (1,610,759) (2,600,520) (1,955,082)
Distributions to unitholders (4,993,579) (4,993,580) (4,993,579)
---------- ---------- ----------

Net cash used in financing activities (1,725,724) (529,211) (4,534,110)
---------- ----------- ----------

Increase (decrease) in cash (515,904) 240,914 322,962

Cash, beginning of year 607,422 366,508 43,546
----------- ----------- -----------

Cash, end of year $ 91,518 $ 607,422 $ 366,508
=========== =========== ===========

SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ 1,977,214 $ 1,072,838 $ 1,000,042
========== ========== ===========
</TABLE>

The accompanying notes to financial statements
are an integral part of these statements.

21
<PAGE> 22

JONES INTERCABLE INVESTORS, L.P.
(A Limited Partnership)

NOTES TO FINANCIAL STATEMENTS

(1) ORGANIZATION OF PARTNERSHIP

Formation and Business

Jones Intercable Investors, L.P. (the "Partnership"), a Colorado
limited partnership, was formed on September 18, 1986, to acquire, own and
operate cable television systems in the United States. On November 28, 1986,
the Partnership completed the sale of 3,230,000 Class A Units, representing
beneficial ownership of Class A Limited Partnership Interests, to the public at
a price of $16.00 per Class A Unit. On May 23, 1987, the Partnership completed
the sale of an additional 4,300,000 Class A Units, representing beneficial
ownership of Class A Limited Partnership Interests to Jones Intercable, Inc.
("Intercable") (800,000 Units) and to the public at a price of $15.00 per Class
A Unit. In addition to its 800,000 Class A Units, Intercable purchased,
through a series of transactions, 792,632 Class B Units. These purchases by
Intercable represent a 19 percent ownership interest in the Partnership. At
December 31, 1989, the Initial Period ended and all Class B Units were
converted to Class A Units. Intercable is the general partner of the
Partnership (the "General Partner"). The General Partner and its subsidiaries
also own and operate cable television systems. In addition, the General
Partner manages cable television systems for other limited partnerships for
which it is general partner and, also, for affiliated entities.

At December 31, 1995, the Partnership owned the cable television
system serving certain communities in and around Independence, Missouri.

Contributed Capital of the Partnership

The capitalization of the Partnership is set forth in the accompanying
statements of partners' capital (deficit).

All profits and losses of the Partnership are allocated 99 percent to the
Unitholders and 1 percent to the General Partner.

Partnership Acquisitions

The Partnership's acquisitions were accounted for using the "purchase
method" of accounting. The allocation of purchase price (determined by
independent appraisal) was distributed as follows: first, to the fair value of
net tangible assets acquired; second, to the value of subscriber lists; third,
to franchise costs; and fourth, to costs in excess of interests in net assets
purchased.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Records

The accompanying financial statements have been prepared on the
accrual basis of accounting in accordance with generally accepted accounting
principles. The Partnership's tax returns are also prepared on the accrual
basis.

The preparation of financial statements in conformity with generally
accepted accounting principles requires the General Partner's management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

22
<PAGE> 23

Property, Plant and Equipment

Depreciation of property, plant and equipment is provided primarily
using the straight-line method over the following estimated service lives:

<TABLE>
<S> <C>
Cable distribution systems 5 - 15 years
Equipment and tools 5 years
Office furniture and equipment 5 years
Buildings 10 - 20 years
Vehicles 3 years
</TABLE>

Replacements, renewals and improvements are capitalized and
maintenance and repairs are charged to expense as incurred.

Intangible Assets

Costs assigned to franchises and costs in excess of interests in net
assets purchased are being amortized using the straight-line method over the
following remaining estimated useful lives:

<TABLE>
<S> <C>
Franchise costs 1 - 3 years
Costs in excess of interests
in net assets purchased 31 years
</TABLE>

Revenue Recognition

Subscriber prepayments are initially deferred and recognized as
revenue when earned.

Reclassifications

Certain prior year amounts were reclassified to conform to the 1995
presentation.

(3) TRANSACTIONS WITH THE GENERAL PARTNER AND AFFILIATES

Management Fees, Reimbursements of Allocated Expenses and Distribution Ratios

The General Partner manages the Partnership and receives a fee for its
services equal to 5 percent of the gross revenues of the Partnership, excluding
revenues from the sale of cable television systems or franchises. Management
fees for the years ended December 31, 1995, 1994 and 1993 were $1,493,266,
$1,376,131 and $1,347,765, respectively.

The Partnership reimburses the General Partner for certain allocated
overhead and administrative expenses. These expenses represent salaries and
related benefits for corporate personnel, rent, data processing services and
other facilities costs. Such personnel provide engineering, marketing,
administrative, accounting, legal and investor relations services to the
Partnership. Allocations of personnel costs are based primarily on actual time
spent by employees of the General Partner with respect to each partnership
managed. Remaining expenses are allocated based on the pro rata relationship
of the Partnership's revenues to the total revenues of all systems owned or
managed by the General Partner and certain of its subsidiaries. Systems owned
by the General Partner and all other systems owned by partnerships for which
Intercable is the general partner are also allocated a proportionate share of
these expenses. The General Partner believes that the methodology used in
allocating overhead and administrative expenses is reasonable. Amounts charged
the Partnership by the General Partner for allocated overhead and
administrative expenses for the years ended December 31, 1995, 1994 and 1993
were $2,138,471, $2,074,563 and $1,880,887, respectively.

The General Partner will receive 40 percent of distributions made upon
sale or refinancing of Partnership cable television system or upon dissolution
after holders of the Class A Units have first received distributions equal to
the Preferred Return, plus distributions, other than distributions of Cash Flow
from Operations, equal to the capital contributions made to the Partnership
with respect to the Class A Units. The "Preferred Return" is defined as a
return equal to 10 percent per annum, cumulative and non-compounded on an
amount equal to the capital contribution made with respect to a Class A Unit,
less any portion of such amount which has been returned to the holders of Class
A Units from

23
<PAGE> 24

prior sale or refinancing proceeds; provided that such return will be reduced
by all prior distributions of Cash Flow from Operations on the Class A Units,
and certain prior distributions of proceeds from sales or refinancing of
Partnership cable television properties.

The Partnership is charged interest on accounts payable to the General
Partner at a rate which approximates the General Partner's weighted average
cost of borrowing. There was no interest charged to the Partnership by the
General Partner during 1995, 1994 and 1993.

Payments to/from Affiliates for Programming Services

The Partnership receives programming from Superaudio, Mind Extension
University and Product Information Network, all of which are affiliates of the
General Partner.

Payments to Superaudio totaled approximately $45,956, $46,113 and
$45,763 in 1995, 1994 and 1993, respectively. Payments to Mind
Extension University totaled approximately $49,159, $41,783 and
$26,607 in 1995, 1994 and 1993, respectively.

The Partnership receives a commission from Product Information Network
based on a percentage of advertising revenue and number of subscribers.
Product Information Network, which initiated service in 1994, paid commissions
to the Partnership totaling $11,148 and $4,073 in 1995 and 1994, respectively.

(4) DISTRIBUTIONS TO UNITHOLDERS

The Partnership declared a $.15 per unit distribution for each of the
four quarters of 1995. All declared distributions were paid at December 31,
1995, except for the fourth quarter distribution, which was paid in February
1996. The Partnership intends to distribute all cash flow from operations
after payment of expenses, capital additions and creation of cash reserves
deemed reasonably necessary to preserve and enhance the value of the
Partnership's cable television system.

(5) PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as of December 31, 1995 and 1994,
consists of the following:

<TABLE>
<CAPTION>
December 31,
---------------------------------------

1995 1994
------------ -------------

<S> <C> <C>
Cable distribution systems $ 61,887,816 $ 55,538,168
Equipment and tools 1,714,326 1,478,965
Office furniture and equipment 642,237 492,444
Buildings 1,178,013 816,670
Vehicles 1,666,138 1,638,553
Land 51,000 51,000
----------- -----------
67,139,530 60,015,800

Less - accumulated depreciation (29,510,807) (25,208,198)
----------- -----------

$ 37,628,723 $ 34,807,602
=========== ===========
</TABLE>

24
<PAGE> 25

(6) DEBT

<TABLE>
<CAPTION>
Debt consists of the following: December 31,
----------------------------------------

1995 1994
--------------- --------------
<S> <C> <C>
Lending institutions-
Revolving credit and term loan $ 26,450,000 $ 23,000,000

Capital lease obligations 311,696 493,841
--------------- -------------

$ 26,761,696 $ 23,493,841
=============== =============
</TABLE>

Installments due on debt principal and capital lease obligations for
each of the five years in the period ending December 31, 2000 and thereafter,
respectively, are $93,508, $1,416,009, $3,399,759, $6,643,670, $7,538,250 and
$7,670,500. At December 31, 1995, substantially all of the Partnership's
property, plant and equipment secured the above indebtedness.

At December 31, 1995, the carrying amount of the Partnership's
long-term debt did not differ significantly from the estimated fair value of
the financial instruments. The fair value of the Partnership's long-term debt
is estimated based on the discounted amount of future debt service payments
using rates of borrowing for a liability of similar risk.

(7) INCOME TAXES

Income taxes have not been recorded in the accompanying financial
statements because the Partnership will pay no federal or state income taxes as
an entity. Instead, all of the income, gains, losses, deductions and credits
of the Partnership will pass through to the General Partner and the
Unitholders. The federal and state income tax returns of the Partnership are
prepared and filed by the General Partner.

The Partnership's tax returns, the qualification of the Partnership as
such for tax purposes, and the amount of distributable Partnership income or
loss are subject to examination by federal and state taxing authorities. If
such examinations result in changes with respect to the Partnership's
qualification as such, or in changes with respect to the Partnership's recorded
income or loss, the tax liability of the General Partner and Unitholders would
likely be changed accordingly.

Taxable income to the General Partner and Unitholders is different
from that reported in the statements of operations largely due to the
difference in depreciation recognized under generally accepted accounting
principles and the expense allowed for tax purposes under the Modified
Accelerated Cost Recovery System. Since the Partnership has previously made an
IRC Section 754 election, the cost basis of the Partnership assets has been
increased or decreased to

25
<PAGE> 26

reflect the difference between the new unitholders' purchase price and their
proportionate share of the adjusted tax basis of the Partnership properties.
The portion of this adjustment which relates to depreciable or amortizable
assets results in difference between book and tax depreciation or amortization.
Under IRC Section 197, certain intangibles placed in service after August 10,
1993, including goodwill, are allowed to be amortized over a 15 year period for
tax purposes, creating additional book and tax amortization differences. There
are no other significant differences between taxable loss and the net loss
reported in the statements of operations.

The General Partner does not expect any currently proposed tax
legislation to have a significant impact on the business of the Partnership.
Current tax law impacts the Unitholders due to limitations on the utilization
of passive losses generated by the Partnership. Investors in Publicly Traded
Partnerships ("PTP's"), such as Jones Intercable Investors, L.P., are subject
to additional limitations under the passive-activity loss rules as amended by
the Revenue Act of 1987. Passive losses reported on Schedule K-1, Form 1065,
by a PTP can only be used to offset passive income from the same partnership.
Passive losses of a PTP which are limited by this rule may be carried forward.

(8) COMMITMENTS AND CONTINGENCIES

26
<PAGE> 27

The Partnership rents office and other facilities under various
long-term operating lease arrangements. Rent paid under such lease
arrangements totaled $166,127, $147,185 and $63,698, respectively, for the
years ended December 31, 1995, 1994 and 1993. Minimum commitments for each of
the five years in the period ending December 31, 2000, and thereafter are as
follows:

<TABLE>
<S> <C>
1996 $154,596
1997 148,251
1998 131,196
1999 43,199
2000 7,200
Thereafter 43,200
-------
$527,642
=======
</TABLE>

(9) SUPPLEMENTARY PROFIT AND LOSS INFORMATION

Supplementary profit and loss information for the respective years is
presented below:

<TABLE>
<CAPTION>
For the Year Ended December 31,
--------------------------------------------------

1995 1994 1993
-------------- -------------- ------------

<S> <C> <C> <C>
Maintenance and repairs $ 356,537 $ 303,262 $ 327,242
========== ========== ==========

Taxes, other than income and payroll taxes $ 252,921 $ 199,752 $ 239,760
========== ========== ==========

Advertising $ 297,727 $ 319,442 $ 272,051
========== ========== ==========

Depreciation of property, plant and equipment $4,429,581 $3,639,053 $3,129,651
========= ========= =========

Amortization of intangible assets $3,451,537 $4,712,386 $6,663,696
========= ========= =========
</TABLE>

27
<PAGE> 28
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE

None.

PART III.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The Partnership itself has no officers or directors. Certain
information concerning the directors and executive officers of the General
Partner is set forth below.

<TABLE>
<S> <C> <C>
Glenn R. Jones 66 Chairman of the Board and Chief Executive Officer
Derek H. Burney 56 Vice Chairman of the Board
James B. O'Brien 46 President and Director
Ruth E. Warren 46 Group Vice President/Operations
Kevin P. Coyle 44 Group Vice President/Finance
Christopher J. Bowick 40 Group Vice President/Technology
George H. Newton 61 Group Vice President/Telecommunications
Timothy J. Burke 45 Group Vice President/Taxation/Administration
Raymond L. Vigil 49 Group Vice President/Human Resources and Director
Cynthia A. Winning 44 Group Vice President/Marketing
Elizabeth M. Steele 44 Vice President/General Counsel/Secretary
Larry W. Kaschinske 36 Controller
Robert E. Cole 63 Director
William E. Frenzel 67 Director
Donald L. Jacobs 57 Director
James J. Krejci 54 Director
John A. MacDonald 42 Director
Raphael M. Solot 62 Director
Daniel E. Somers 48 Director
Howard O. Thrall 48 Director
Robert B. Zoellick 42 Director
</TABLE>

Mr. Glenn R. Jones has served as Chairman of the Board of Directors
and Chief Executive Officer of the General Partner since its formation in 1970,
and he was President from June 1984 until April 1988. Mr. Jones is the sole
shareholder, President and Chairman of the Board of Directors of Jones
International, Ltd. He is also Chairman of the Board of Directors of the
subsidiaries of the General Partner and of certain other affiliates of the
General Partner. Mr. Jones has been involved in the cable television business
in various capacities since 1961, is a past and present member of the Board of
Directors and the Executive Committee of the National Cable Television
Association. He also is on the Executive Committee of Cable in the Classroom,
an organization dedicated to education via cable. Additionally, in March 1991,
Mr. Jones was appointed to the Board of Governors for the American Society for
Training and Development, and in November 1992 to the Board of Education
Council of the National Alliance of Business. Mr. Jones is also a founding
member of the James Madison Council of the Library of Congress. Mr. Jones is a
past director and member of the Executive Committee of C-Span. Mr. Jones has
been the recipient of several awards including the Grand Tam Award in 1989, the
highest award from the Cable Television Administration and Marketing Society;
the Chairman's Award from the Investment Partnership Association, which is an
association of sponsors of public syndications; the cable television industry's
Public Affairs Association President's Award in 1990, the Donald G. McGannon
award for the advancement of minorities and women in cable; the STAR Award from
American Women in Radio and Television, Inc. for exhibition of a commitment to
the issues and concerns of women in television and radio; the Women in Cable
Accolade in 1990 in recognition of support of this organization; the Most
Outstanding Corporate Individual Achievement award from the International
Distance Learning Conference; the Golden Plate Award

28
<PAGE> 29
from the American Academy of Achievement for his advances in distance
education; the Man of the Year named by the Denver chapter of the Achievement
Rewards for College Scientists; and in 1994 Mr. Jones was inducted into
Broadcasting and Cable's Hall of Fame.

Mr. Derek H. Burney was appointed a Director of the General Partner on
December 20, 1994 and Vice Chairman of the Board of Directors on January 31,
1995. Mr. Burney joined BCE Inc., Canada's largest telecommunications company,
in January 1993 as Executive Vice President, International. He has been the
Chairman of Bell Canada International Inc., a subsidiary of BCE, since January
1993 and, in addition, has been Chief Executive Officer of BCI since July 1993.
Prior to joining BCE, Mr. Burney served as Canada's ambassador to the United
States from 1989 to 1992. Mr. Burney also served as chief of staff to the
Prime Minister of Canada from March 1987 to January 1989 where he was directly
involved with the negotiation of the U.S. - Canada Free Trade Agreement. In
July 1993, he was named an Officer of the Order of Canada. Mr. Burney is
chairman of Bell Cablemedia plc. He is a director of Mercury Communications
Limited, Videotron Holdings plc, Tele-Direct (Publications) Inc., Teleglobe
Inc., Bimcor Inc., Maritime Telegraph and Telephone Company, Limited, Moore
Corporation Limited and Northbridge Programming Inc.

Mr. James B. O'Brien, the General Partner's President, joined the
General Partner in January 1982. Prior to being elected President and a
Director of the General Partner in December 1989, Mr. O'Brien served as a
Division Manager, Director of Operations Planning/Assistant to the CEO, Fund
Vice President and Group Vice President/Operations. Mr. O'Brien was appointed
to the General Partner's Executive Committee in August 1993. As President, he
is responsible for the day-to-day operations of the cable television systems
managed and owned by the General Partner. Mr. O'Brien is a board member of
Cable Labs, Inc., the research arm of the U.S. cable television industry. He
also serves as a director of the Cable Television Administration and Marketing
Association and as a director of the Walter Kaitz Foundation, a foundation that
places people of ethnic minority groups in positions with cable television
systems, networks and vendor companies.

Ms. Ruth E. Warren joined the General Partner in August 1980 and has
served in various operational capacities, including system manager and Fund
Vice President, since then. Ms. Warren was elected Group Vice
President/Operations of the General Partner in September 1990.

Mr. Kevin P. Coyle joined The Jones Group, Ltd. in July 1981 as Vice
President/Financial Services. In September 1985, he was appointed Senior Vice
President/Financial Services. He was elected Treasurer of the General Partner
in August 1987, Vice President/Treasurer in April 1988 and Group Vice
President/Finance and Chief Financial Officer in October 1990.

Mr. Christopher J. Bowick joined the General Partner in September 1991
as Group Vice President/Technology and Chief Technical Officer. Previous to
joining the General Partner, Mr. Bowick worked for Scientific Atlanta's
Transmission Systems Business Division in various technical management
capacities since 1981, and as Vice President of Engineering since 1989.

Mr. George H. Newton joined the General Partner in January 1996 as
Group Vice President/Telecommunications. Prior to joining the General Partner,
Mr. Newton was President of his own consulting business, Clear Solutions, and
since 1994 Mr. Newton has served as a Senior Advisor to Bell Canada
International. From 1990 to 1993, Mr. Newton served as the founding Chief
Executive Officer and Managing Director of Clear Communications, New Zealand,
where he established an alternative telephone company in New Zealand. From
1964 to 1990, Mr. Newton held a wide variety of operational and business
assignments with Bell Canada International.

Mr. Timothy J. Burke joined the General Partner in August 1982 as
corporate tax manager, was elected Vice President/Taxation in November 1986 and
Group Vice President/Taxation/Administration in October 1990.

Mr. Raymond L. Vigil joined the General Partner in June 1993 as Group
Vice President/Human Resources. Previous to joining the General Partner, Mr.
Vigil served as Executive Director of Learning with

29
<PAGE> 30
USWest. Prior to USWest, Mr. Vigil worked in various human resources posts
over a 14-year term with the IBM Corporation.

Ms. Cynthia A. Winning joined the General Partner as Group Vice
President/Marketing in December 1994. Previous to joining the General Partner,
Ms. Winning served since 1994 as the President of PRS Inc., Denver, Colorado, a
sports and event marketing company. From 1979 to 1981 and from 1986 to 1994,
Ms. Winning served as the Vice President and Director of Marketing for Citicorp
Retail Services, Inc., a provider of private-label credit cards for ten
national retail department store chains. From 1981 to 1986, Ms. Winning was
the Director of Marketing Services for Daniels & Associates cable television
operations, as well as the Western Division Marketing Director for Capital
Cities Cable. Ms. Winning also serves as a board member of Cities in Schools,
a dropout intervention/prevention program.

Ms. Elizabeth M. Steele joined the General Partner in August 1987 as
Vice President/General Counsel and Secretary. From August 1980 until joining
the General Partner, Ms. Steele was an associate and then a partner at the
Denver law firm of Davis, Graham & Stubbs, which serves as counsel to the
General Partner.

Mr. Larry Kaschinske joined the General Partner in 1984 as a staff
accountant in the General Partner's former Wisconsin Division, was promoted to
Assistant Controller in 1990 and named Controller in August 1994.

Mr. Robert E. Cole was appointed a Director of the General Partner in
March 1996. Mr. Cole is currently self-employed as a partner of First Variable
Insurance Marketing and is responsible for marketing to National Association of
Securities Dealers, Inc. firms in northern California, Oregon, Washington and
Alaska. From 1993 to 1995, Mr. Cole was the Director of Marketing for Lamar
Life Insurance Company; from 1992 to 1993, Mr. Cole was Senior Vice President
of PMI Inc., a third party lender serving the special needs of Corporate Owned
Life Insurance (COLI) and from 1988 to 1992, Mr. Cole was the principal and
co-founder of a specialty investment banking firm that provided services to
finance the ownership and growth of emerging companies, productive assets and
real property. Mr. Cole is a Certified Financial Planner and a former United
States Naval Aviator.

Mr. William E. Frenzel was appointed a Director of the General Partner
on April 11, 1995. Mr. Frenzel has been a Guest Scholar since 1991 with the
Brookings Institution, a research organization located in Washington D. C.
Until his retirement in January 1991, Mr. Frenzel served for twenty years in
the United States House of Representatives, representing the State of
Minnesota, where he was a member of the House Ways and Means Committee and its
Trade Subcommittee, the Congressional Representative to the General Agreement
on Tariffs and Trade (GATT), the Ranking Minority Member on the House Budget
Committee and a member of the National Economic Commission. Mr. Frenzel also
served in the Minnesota Legislature for eight years. He is a Distinguished
Fellow of the Tax Foundation, Vice Chairman of the Eurasia Foundation, a Board
Member of the U.S.-Japan Foundation, the Close-Up Foundation, Sit Mutual Funds
and Chairman of the Japan-America Society of Washington.

Mr. Donald L. Jacobs was appointed a Director of the General Partner
on April 11, 1995. Mr. Jacobs is a retired executive officer of TRW. Prior to
his retirement, he was Vice President and Deputy Manager of the Space and
Defense Sector; prior to that appointment, he was the Vice President and
General Manager of the Defense Systems Group and prior to his appointment as
Group General Manager, he was President of ESL, Inc., a wholly owned subsidiary
of TRW. During his career, Mr. Jacobs served on several corporate,
professional and civic boards.

Mr. James J. Krejci was President of the International Division of
International Gaming Technology, International headquartered in Reno, Nevada,
until March 1995. Prior to joining IGT in May 1994, Mr. Krejci was Group Vice
President of Jones International, Ltd. and was Group Vice President of the
General Partner. He also served as an officer of Jones Futurex, Inc., a
subsidiary of the General Partner engaged in manufacturing and marketing data
encryption devices, Jones Interactive, Inc., a subsidiary of Jones
International, Ltd. providing computer data and billing processing facilities
and Jones Lightwave, Ltd., a company owned by Jones International, Ltd. and Mr.
Jones, and several of its subsidiaries engaged in the provision of
telecommunications

30
<PAGE> 31
services until leaving the General Partner in May 1994. Mr. Krejci has been a
Director of the General Partner since August 1987.

Mr. John A. MacDonald was appointed a Director of the General Partner
on November 8, 1995. Mr. MacDonald is Executive Vice President of Business
Development and Chief Technology Officer of Bell Canada International Inc.
Prior to joining Bell Canada in November 1994, Mr. MacDonald was President and
Chief Executive Officer of The New Brunswick Telephone Company, Limited, a post
he had held since March of that year. Prior to March 1994, Mr. MacDonald was
with NBTel for 17 years serving in various capacities, including Market
Planning Manager, Corporate Planning Manager, Manager of Systems Planning and
Development and General Manager, Chief Engineer and General Manager of
Engineering and Information Systems and Vice President of Planning. Mr.
MacDonald was the former Chairman of the New Brunswick section of the Institute
of Electrical and Electronic Engineers and also served on the Federal
Government's Information Highway Advisory Council. Mr. MacDonald is Chairman
of MediaLinx Interactive Inc. and Stentor Canadian Network Management and is
presently a Governor of the Montreal Exchange. He also serves on the Board of
Directors of Tele-Direct (Publications) Inc., Bell-Northern Research, Ltd.,
SRCI, Bell Sygma, Canarie Inc., and is a member of the University of New
Brunswick Venture Campaign Cabinet.

Mr. Raphael M. Solot was appointed a Director of the General Partner
in March 1996. Mr. Solot is an attorney licensed to practice law in the State
of Colorado. Mr. Solot has practiced law in the State of Colorado as a sole
practitioner since obtaining his Juris Doctor degree from the University of
Colorado in 1964.

Mr. Daniel E. Somers was initially appointed a Director of the General
Partner on December 20, 1994. Mr. Somers resigned as a Director on December
31, 1995, at the time he was elected Chief Executive Officer of Bell
Cablemedia. Mr. Somers was reinstated as a Director of the General Partner on
February 2, 1996. From January 1992 to January 1995, Mr. Somers worked as
senior Vice President and Chief Financial Officer of Bell Canada International
Inc. and was appointed Executive Vice President and Chief Financial Officer on
February 1, 1995. He is also a Director of certain of its affiliates. Mr.
Somers currently serves as Chief Executive Officer of Bell Cablemedia. Prior
to joining Bell Canada International Inc. and since January 1989, Mr. Somers
was the President and Chief Executive Officer of Radio Atlantic Holdings
Limited. Mr. Somers is a member of the North American Society of Corporate
Planning, the Financial Executives Institution and the Financial Analysts
Federation.

Mr. Howard O. Thrall was appointed a Director of the General Partner
on March 6, 1996. Mr. Thrall had previously served as a Director of the
General Partner from December 1988 to December 1994. Since September 1993, Mr.
Thrall has served as Vice President of Sales, Asian Region, for World Airways,
Inc. From 1984 until August 1993, Mr. Thrall was with the McDonnell Douglas
Corporation, where he concluded as a Regional Vice President, Commercial
Marketing with the Douglas Aircraft Company subsidiary. Mr. Thrall is also a
management and international marketing consultant, having completed assignments
with First National Net, Inc., Cheong Kang Associated (Korea), Aero Investment
Alliance, Inc. and Western Real Estate Partners.

Mr. Robert B. Zoellick was appointed a Director of the General Partner
on April 11, 1995. Mr. Zoellick is Executive Vice President, General Counsel
and Corporate Secretary of Fannie Mae, a federally chartered and
stockholder-owned corporation that is the largest housing finance investor in
the United States. From August 1992 to January 1993, Mr. Zoellick served as
Deputy Chief of Staff of the White House and Assistant to the President. From
May 1991 to August 1992, Mr. Zoellick served concurrently as the Under
Secretary of State for Economic and Agricultural Affairs and as Counselor of
the Department of State, a post he assumed in March 1989. From 1985 to 1988,
Mr. Zoellick served at the Department of Treasury in a number of capacities,
including Counselor to the Secretary. Mr. Zoellick received the Alexander
Hamilton and Distinguished Service Awards, highest honors of the Departments of
Treasury and State, respectively. The German Government awarded him the Knight
Commanders Cross for his work on Germany unification. Mr. Zoellick currently
serves on the boards of the Council on Foreign Relations, the Congressional
Institute, the German Marshall Fund of the U.S., the European Institute, the
National Bureau of Asian Research, the American Council on Germany and the
Overseas Development Council.

31
<PAGE> 32
Christopher J. Bowick, Cynthia A. Winning and Larry W. Kaschinske are
executive officers of the General Partner; Raymond L. Vigil is an executive
officer and a director of the General Partner; and Derek H. Burney, John A.
MacDonald and Daniel E. Somers are directors of the General Partner. Reports
by these persons with respect to the ownership of limited partnership interests
in the Partnership required by Section 16(a) of the Securities Exchange Act of
1934, as amended, were not filed within the required time. None of these
individuals own any limited partnership interests in the Partnership.

ITEM 11. EXECUTIVE COMPENSATION

The Partnership has no employees; however, various personnel are
required to operate the Independence System. Such personnel are employed by
the General Partner and, pursuant to the terms of the limited partnership
agreement of the Partnership, the cost of such employment is charged by the
General Partner to the Partnership as a direct reimbursement item. See Item
13.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGERS

No person or entity owns more than 5 percent of the limited
partnership interests of the Partnership, except for the General Partner. The
General Partner owns 19.14 percent of the limited partnership interests in the
Partnership.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The General Partner and its affiliates engage in certain transactions
with the Partnership. The General Partner believes that the terms of such
transactions are generally as favorable as could be obtained by the Partnership
from unaffiliated parties. This determination has been made by the General
Partner in good faith, but none of the terms were or will be negotiated at
arm's-length and there can be no assurance that the terms of such transactions
have been or will be as favorable as those that could have been obtained by the
Partnership from unaffiliated parties.

The General Partner charges a management fee, and the General Partner
is reimbursed for certain allocated overhead and administrative expenses.
These expenses represent the salaries and benefits paid to corporate personnel,
rent, data processing services and other corporate facilities costs. Such
personnel provide engineering, marketing, administrative, accounting, legal and
investor relations services to the Partnership. Allocations of personnel costs
are based primarily on actual time spent by employees of the General Partner
with respect to each partnership managed. Remaining expenses are allocated
based on the pro rata relationship of the Partnership's revenues to the total
revenues of all systems owned or managed by the General Partner and certain of
its subsidiaries. Systems owned by the General Partner and all other systems
owned by partnerships for which Jones Intercable, Inc. is the general partner,
are also allocated a proportionate share of these expenses.

The Independence System receives stereo audio programming from
Superaudio, a joint venture owned 50% by an affiliate of the General Partner
and 50% by an unaffiliated party, educational video programming from Mind
Extension University, Inc., an affiliate of the General Partner, and computer
video programming from Jones Computer Network, Ltd., an affiliate of the
General Partner, for fees based upon the number of subscribers receiving the
programming.

Product Information Network ("PIN"), an affiliate of the General
Partner, provides advertising time for third parties on the Independence
System. In consideration, the revenues generated from the third parties are
shared two-thirds and one-third between PIN and the Partnership. During the
year ended December 31, 1995, the Partnership received revenues from PIN of
$11,148.

32
<PAGE> 33
The charges to the Partnership for related party transactions are as
follows for the periods indicated:

<TABLE>
<CAPTION>
At December 31,
-----------------------------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Management fees $1,493,266 $1,376,131 $1,347,765
Allocation of expenses 2,138,471 2,074,563 1,880,887
Programming fees:
Superaudio 45,956 46,113 45,763
Mind Extension University 49,159 41,783 26,607
</TABLE>

33
<PAGE> 34
PART IV.

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)1. See index to financial statements for list of
financial statements and exhibits thereto filed as a
part of this report.

3. Exhibits:

4.1 Limited Partnership Agreement for Jones Intercable
Investors, L.P. (1)

10.1.1 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the Village of Baldwin Park, Missouri.
(3)

10.1.2 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Bates, Missouri. (4)

10.1.3 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Blue Springs, Missouri.
(2)

10.1.4 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Grain Valley, Missouri.
(2)

10.1.5 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Greenwood, Missouri. (2)

10.1.6 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Independence, Missouri.
(2)

10.1.7 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the County of Jackson, Missouri. (3)

10.1.8 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the County of Johnson, Missouri. (3)

10.1.9 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Lake Lotawana, Missouri.
(2)

10.1.10 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Lake Tapawingo, Missouri.
(2)

10.1.11 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Lake Winnebago, Missouri.
(2)

10.1.12 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Lee's Summit, Missouri.
(2)

10.1.13 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Oak Grove, Missouri. (2)

10.1.14 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Odessa, Missouri. (2)

34
<PAGE> 35
10.1.15 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Olathe, Kansas. (2)

10.1.16 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Peculiar, Missouri. (2)

10.1.17 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Pleasant Hill, Missouri.
(2)

10.1.18 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Raymore, Missouri. (2)

10.1.19 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Raytown, Missouri. (2)

10.1.20 Copy of a franchise and related documents thereto
granting a community antenna television system
franchise for the City of Sugar Creek, Missouri. (2)

10.2.1 Revolving Credit and Term Loan Agreement dated as of
December 30, 1994, between the Partnership,
Nationsbank of Texas, N.A. and other banks. (5)

27 Financial Data Schedule

____________

(1) Incorporated by reference from Registrant's Annual
Report on Form 10-K for fiscal year ended December
31, 1986.

(2) Incorporated by reference from Registrant's Annual
Report on Form 10-K for fiscal year ended December
31, 1987.

(3) Incorporated by reference from Registrant's Annual
Report on Form 10-K for fiscal year ended December
31, 1988.

(4) Incorporated by reference from Registrant's Annual
Report on Form 10-K for fiscal year ended December
31, 1992.

(5) Incorporated by reference from Registrant's Annual
Report on Form 10-K for fiscal year ended December
31, 1994.

(b) Reportson Form 8-K

None.

35
<PAGE> 36
SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

JONES INTERCABLE INVESTORS, L.P.
a Colorado limited partnership
By: Jones Intercable, Inc.

By: /s/ GLENN R. JONES
-----------------------------------
Glenn R. Jones
Chairman of the Board and Chief
Dated: March 25, 1996 Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

By: /s/ GLENN R. JONES
-----------------------------------
Glenn R. Jones
Chairman of the Board and Chief
Executive Officer
Dated: March 25, 1996 (Principal Executive Officer)

By: /s/ KEVIN P. COYLE
-----------------------------------
Kevin P. Coyle
Group Vice President/Finance
Dated: March 25, 1996 (Principal Financial Officer)

By: /s/ LARRY KASCHINSKE
-----------------------------------
Larry Kaschinske
Controller
Dated: March 25, 1996 (Principal Accounting Officer)

By: /s/ JAMES B. O'BRIEN
-----------------------------------
James B. O'Brien
Dated: March 25, 1996 President and Director

By: /s/ RAYMOND L. VIGIL
-----------------------------------
Raymond L. Vigil
Dated: March 25, 1996 Group Vice President and Director

By: /s/ DEREK H. BURNEY
-----------------------------------
Derek H. Burney
Dated: March 25, 1996 Director

36
<PAGE> 37
By:
-----------------------------------
Robert E. Cole
Dated: Director

By: /s/ WILLIAM E. FRENZEL
-----------------------------------
William E. Frenzel
Dated: March 25, 1996 Director

By: /s/ DONALD L. JACOBS
-----------------------------------
Donald L. Jacobs
Dated: March 25, 1996 Director

By: /s/ JAMES J. KREJCI
-----------------------------------
James J. Krejci
Dated: March 25, 1996 Director

By: /s/ JOHN A. MACDONALD
-----------------------------------
John A. MacDonald
Dated: March 25, 1996 Director

By:
-----------------------------------
Raphael M. Solot
Dated: Director

By: /s/ DANIEL E. SOMERS
-----------------------------------
Daniel E. Somers
Dated: March 25, 1996 Director

By: /s/ HOWARD O. THRALL
-----------------------------------
Howard O. Thrall
Dated: March 25, 1996 Director

By: /s/ ROBERT B. ZOELLICK
-----------------------------------
Robert B. Zoellick
Dated: March 25, 1996 Director

37
<PAGE> 38
EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description Page
- ------- ------------------- ----
<S> <C> <C>
4.1 Limited Partnership Agreement for Jones Intercable Investors,
L.P. (1)

10.1.1 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the Village
of Baldwin Park, Missouri. (3)

10.1.2 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Bates, Missouri. (4)

10.1.3 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Blue Springs, Missouri. (2)

10.1.4 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Grain Valley, Missouri. (2)

10.1.5 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Greenwood, Missouri. (2)

10.1.6 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Independence, Missouri. (2)

10.1.7 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the County
of Jackson, Missouri. (3)

10.1.8 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the County
of Johnson, Missouri. (3)

10.1.9 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Lake Lotawana, Missouri. (2)

10.1.10 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Lake Tapawingo, Missouri. (2)

10.1.11 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Lake Winnebago, Missouri. (2)

10.1.12 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Lee's Summit, Missouri. (2)

10.1.13 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Oak Grove, Missouri. (2)

10.1.14 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Odessa, Missouri. (2)

</TABLE>

<PAGE> 39

<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description Page
- ------- ------------------- ----
<S> <C> <C>
10.1.15 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Olathe, Kansas. (2)

10.1.16 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Peculiar, Missouri. (2)

10.1.17 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Pleasant Hill, Missouri. (2)

10.1.18 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Raymore, Missouri. (2)

10.1.19 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Raytown, Missouri. (2)

10.1.20 Copy of a franchise and related documents thereto granting a
community antenna television system franchise for the City of
Sugar Creek, Missouri. (2)

10.2.1 Revolving Credit and Term Loan Agreement dated as of December
30, 1994, between the Partnership, Nationsbank of Texas, N.A.
and other banks. (5)

27 Financial Data Schedule

____________

(1) Incorporated by reference from Registrant's Annual Report on
Form 10-K for fiscal year ended December 31, 1986.

(2) Incorporated by reference from Registrant's Annual Report on
Form 10-K for fiscal year ended December 31, 1987.

(3) Incorporated by reference from Registrant's Annual Report on
Form 10-K for fiscal year ended December 31, 1988.

(4) Incorporated by reference from Registrant's Annual Report on
Form 10-K for fiscal year ended December 31, 1992.

(5) Incorporated by reference from Registrant's Annual Report on
Form 10-K for fiscal year ended December 31, 1994.

</TABLE>

<ARTICLE> 5

<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 91,518
<SECURITIES> 0
<RECEIVABLES> 1,378,312
<ALLOWANCES> (82,938)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 67,139,530
<DEPRECIATION> (29,510,807)
<TOTAL-ASSETS> 48,075,513
<CURRENT-LIABILITIES> 3,825,240
<BONDS> 26,450,000
0
0
<COMMON> 0
<OTHER-SE> 17,800,273
<TOTAL-LIABILITY-AND-EQUITY> 48,075,513
<SALES> 0
<TOTAL-REVENUES> 29,865,310
<CGS> 0
<TOTAL-COSTS> 26,557,619
<OTHER-EXPENSES> 586,801
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,926,459
<INCOME-PRETAX> 794,431
<INCOME-TAX> 0
<INCOME-CONTINUING> 794,431
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 794,431
<EPS-PRIMARY> 0
<EPS-DILUTED> 0

</TABLE>