
                              EXHIBIT 99.1

                            COMPANY RISK FACTORS

     As used herein, unless the context otherwise requires, the "Company" and
"ACC" refer to ACC Corp. and its subsidiaries, including ACC Long Distance
Corp. ("ACC U.S."), ACC TelEnterprises Ltd. ("ACC Canada"), and ACC Long
Distance UK Ltd. ("ACC U.K.").  References herein to "dollar" and "$" are to
United States dollars, references to "Cdn. $" are to Canadian dollars,
references to "<pound-sterling>" are to English pounds sterling, the terms
"United States" and "U.S." mean the United States of America and, unless the
context otherwise requires, its states, territories and possessions and all
areas subject to its jurisdiction, and the terms "United Kingdom" and "U.K."
mean England, Scotland and Wales.

RECENT LOSSES; POTENTIAL FLUCTUATIONS IN OPERATING RESULTS

     Although the Company has experienced revenue growth on an annual basis
since 1990 and net income in 1996 and the first six months of 1997, it incurred
net losses and losses from continuing operations during 1994 and 1995.  There
can be no assurance that revenue growth will continue or that the Company will
be able to maintain its profitability and positive cash flow from operations.
If the Company cannot continue its revenue growth and maintain profitability
and positive cash flow from operations, it may not be able to meet its debt
service or working capital requirements.  The Company intends to focus in the
near term on the expansion of its service offerings, including its local
telephone service and Internet services, and expanding its geographic markets,
including deregulating Western European markets.  Such expansion, particularly
the establishment of new operations or acquisition of existing operations in
deregulating Western European markets, may adversely affect cash flow and
operating performance and these effects may be material, as was the case with
the Company's U.K. operations in 1994 and 1995.  As each of the
telecommunications markets in which the Company operates continues to mature,
growth in the Company's revenues and customer base is likely to decrease over
time.

     The Company's operating results have fluctuated in the past and may
fluctuate significantly in the future as a result of a variety of factors, some
of which are outside of the Company's control, including general economic
conditions, specific economic conditions in the telecommunications industry,
the effects of governmental regulation and regulatory changes, user demand,
capital expenditures and other costs relating to the expansion of operations,
the introduction of new services by the Company or its competitors, the mix of
services sold and the mix of channels through which those services are sold,
pricing changes by the Company or its competitors and prices charged by
suppliers.  As a strategic response to a changing competitive environment, the
Company may elect from time to time to make certain pricing, service or
marketing decisions or enter into strategic alliances, acquisitions or
investments that could have a material adverse effect on the Company's
business, results of operations and cash flow.  Revenues from other resellers
accounted for approximately 12.7% of consolidated revenues in 1995, 25.2% of
consolidated revenues in 1996 and 21% of consolidated revenues during the first
six months of 1997.  Carrier revenues during 1997 will be adversely affected
by the loss of wholesale traffic from a large Canadian long distance carrier
which accounted for approximately $13.4 million of revenue during 1996, most of
which is expected to be non-recurring.  Because sales to other carriers are at
margins that are lower than those derived from most of the Company's other
revenues, increases in carrier revenue as a percentage of revenues have in the
past reduced and may in the future reduce, the Company's gross margins as a
percentage of revenue.  In addition, certain of its long distance carrier
customers may pose credit or collection risks.  See the Risk Factor discussion
below of " Risks Associated With Acquisitions, Investments and Strategic
Alliances" and "Management's Discussion and Analysis of Financial Condition and
Results of Operations."


SUBSTANTIAL INDEBTEDNESS; NEED FOR ADDITIONAL CAPITAL

     The Company will need to continue to enhance and expand its operations in
order to maintain its competitive position, expand its service offerings and
geographic markets and continue to meet the increasing demands for service
quality, availability and competitive pricing.  As of the end of its last five
fiscal years, the Company has experienced a working capital deficit.  The
Company believes that, under its present business plan, cash from operations
and borrowings available under its credit facility will be sufficient to meet
its anticipated capital and capital expenditure requirements for the
foreseeable future.  The Company may need to raise additional capital from
public or private equity or debt sources in order to finance its anticipated
growth, including local service expansion and expansion into international
markets (both of which will be capital intensive), working capital needs, debt
service obligations, and, contemplated capital expenditures. In addition, the
Company may need to raise additional funds in order to take advantage of
unanticipated opportunities, including more rapid international expansion or
acquisitions of, investments in or strategic alliances with companies that are
complementary to the Company's current operations, or to develop new products
or otherwise respond to unanticipated competitive pressures.  If additional
funds are raised through the issuance of equity securities, the percentage
ownership of the Company's then current shareholders would be reduced and, if
such equity securities take the form of Preferred Stock or Class B Common
Stock, the holders of such Preferred Stock or Class B Common Stock may have
rights, preferences or privileges senior to those of holders of Class A Common
Stock.  There can be no assurance that the Company will be able to raise such
capital on satisfactory terms or at all.  If the Company decides to raise
additional funds through the incurrence of debt, the Company would need to
obtain the consent of its lenders under the Company's credit facility and would
likely become subject to additional or more restrictive financial covenants.
In the event that the Company is unable to obtain such additional capital or is
unable to obtain such additional capital on acceptable terms, the Company may
be required to reduce the scope of its presently anticipated expansion, which
could materially adversely affect the Company's business, results of operations
and financial condition and its ability to compete.  See "Management's
Discussion and Analysis of Financial Condition and Results of Operations -
Liquidity and Capital Resources."

DEPENDENCE ON TRANSMISSION FACILITIES-BASED CARRIERS

     The Company generally does not own telecommunications transmission lines
other than the recently acquired Indefeasible Rights of Use.  Telephone calls
made by the Company's customers are connected through transmission lines that
the Company leases under a variety of arrangements with transmission
facilities-based long distance carriers, some of which are or may become
competitors of the Company, including AT&T Corp. ("AT&T"), Bell Canada and
British Telecommunications plc ("British Telecom").  Most inter-city
transmission lines used by the Company are leased at rates that currently are
less than the rates the Company charges its customers for connecting calls
through these lines.  Accordingly, to the extent that the Company continues to
lease transmission lines, it will remain vulnerable to changes in its lease
arrangements, such as price increases and service cancellations.  ACC's ability
to maintain and expand its business is dependent upon maintaining favorable
relationships with the transmission facilities-based carriers from which the
Company leases transmission lines, particularly in the U.K., where British
Telecom and Mercury Communications Ltd. ("Mercury") are the two principal,
dominant carriers.  The Company's U.K. operations are highly dependent upon the
transmission lines leased from British Telecom.  Although the Company believes
that its relationships with carriers generally are satisfactory, the
deterioration or termination of the Company's relationships with one or more of
those carriers could have a material adverse effect upon the Company's
business, results of operations and financial condition.  Certain of the
vendors from whom the Company leases transmission lines, including the
22 former Bell System Operating Companies ("RBOCs") and other local exchange
carriers, currently are subject to tariff controls and other price constraints
which in the future may be changed.  Under the 1996 amendments to the U.S.
Communications Act of 1934 (the "1996 Act"), constraints on the operations of
the RBOCs have been dramatically reduced, which will bring into the long
distance market additional competitors from whom the Company leases
transmission lines.  In addition, certain regulatory issues are pending
that may affect the prices charged by the RBOCs and other local
exchange carriers to the Company, which could have a material adverse
effect on the Company's business, financial condition and results of
operations.  See "-Potential Adverse Effects of Regulation."

POTENTIAL ADVERSE EFFECTS OF REGULATION

     The 1996 Act provides specific guidelines under which the RBOCs can
provide long distance services, which will permit the RBOCs to compete with the
Company in the provision of domestic and international long distance services.
The legislation also opens all local service markets to competition from any
entity (including, for example, long distance carriers, such as AT&T, cable
television companies and utilities).  Because the legislation opens the
Company's markets to additional competition, particularly from the RBOCs, the
Company may be subject to additional competition.  Moreover, as a result of and
to implement the legislation, certain federal and state governmental
regulations will be adopted, amended or modified, and any such adoption,
amendment or modification could have a material adverse effect on the Company's
business, results of operations and financial condition.

     In the U.S., the Federal Communications Commission ("FCC") and relevant
state public service commissions ("PSCs") have the authority to regulate
interstate and intrastate rates, respectively, ownership of transmission
facilities, and the terms and conditions under which the Company's services are
provided.  Federal and state regulations and regulatory trends have had, and in
the future are likely to have, both positive and negative effects on the
Company and its ability to compete.  The recent trend in both Federal and state
regulation of telecommunications service providers has been in the direction of
lessened regulation.  In general, neither the FCC nor the relevant state PSCs
currently regulate the Company's long distance rates or profit levels, but
either or both may do so in the future.  However, the general recent trend
toward reduced regulation has given AT&T, the largest long distance carrier in
the U.S., as well as the RBOCs, increased pricing flexibility that has
permitted them to compete more effectively with smaller interexchange carriers,
such as the Company.  In addition, the commitments made by the U.S. government
in the recently-completed World Trade Organization ("WTO") negotiations will
allow foreign-affiliated carriers previously prohibited from providing service
in the U.S. market to compete with the Company in the U.S. market.  There can
be no assurance that changes in current or future Federal or state regulations
or future judicial changes would not have a material adverse effect on the
Company's business, results of operations and financial condition.

     In order to provide their services, interexchange carriers, including the
Company, must generally purchase "access" from local exchange carriers to
originate calls from and terminate calls in the local exchange telephone
networks.  Access charges presently represent a significant portion of the
Company's network costs in all areas in which it operates.  In the U.S., the
FCC regulates interstate access and the states regulate intrastate access.
Pursuant to the 1996 Act, on May 16, 1997, the FCC issued an order to implement
certain reforms to its access charge rules (the "Access Charge Reform Order").
The Access Charge Reform Order will require incumbent LECs to substantially
decrease over time the prices they charge for switched and special access,
and change how access charges are calculated.  These changes are intended to
reduce access charges paid by interexchange carriers to LECs and shift
certain usage-based charges to flat-rated, monthly per-line charges.  To the
extent that these rules begin to reduce access charges to reflect the forward-
looking cost of providing access, the Company's competitive advantage in
providing customers with access services might decrease.  In addition, the FCC
has determined that it will give incumbent LECs pricing flexibility with
respect to access charges.  To the extent such pricing flexibility is granted
before substantial facilities-based competition develops, such flexibility
could be misused to the detriment of new entrants, including the Company.
Until the FCC adopts and releases rules detailing the extent and timing of
such pricing flexibility, the impact of these rules on the Company cannot be
determined.  In its order, the FCC abolished the unitary rate structure option
for local transport.  This effectively abolishes the "equal price per unit of
traffic" rule which has been in effect since the divestiture of AT&T, and may
have an adverse effect on smaller interexchange carriers such as the Company
because it may permit volume discounts in the pricing of access charges.

     On May 8, 1997, the FCC issued an order to implement the provisions of
the 1996 Act relating to the preservation and advancement of universal
telephone service (the "Universal Service Order").  The Universal Service
Order affirmed the policy principles for universal telephone service set
forth in the Telecommunications Act, including quality service, affordable
rates, access to advanced services, access in rural and high-cost areas,
equitable and non-discriminatory contributions, specific and predictable
support mechanisms, and access to advanced telecommunications services for
schools, health care providers and libraries.  The Universal Service Order
added "competitive neutrality" to the FCC's universal service principles by
providing that universal service support mechanisms and rules should not
unfairly advantage or disadvantage one provider over another, nor unfairly
favor or disfavor one technology over another.  The Universal Service Order
also requires all telecommunications carriers providing interstate
telecommunications services, including the Company, to contribute to
universal service support.  Such contributions will be assessed based on
interstate and international end-user telecommunications revenues.

     Both the Universal Service and Access Charge Reform Orders are subject
to petitions seeking reconsideration by the FCC and direct appeals to U.S.
Courts of Appeals.  Until the time when any such petitions or appeals are
decided, there can be no assurance of how the Universal Service and/or Access
Charge Reform Orders will be implemented or enforced, or what effect the
Orders will have on competition within the telecommunications industry,
generally, or on the competitive position of the Company, specifically. 

     The Company currently competes with the RBOCs and other local exchange
carriers such as the GTE Operating Companies ("GTOCs") in the provision of
"short haul" toll calls completed within a Local Access and Transport Area
("LATA").  Subject to a number of conditions, the 1996 Act established
conditions that would allow for the eventual elimination of many of the
restrictions which prohibited the RBOCs from providing long-haul, or
inter-LATA, toll service, and thus the Company will face additional
competition in this market.  To complete long-haul and short-haul toll calls,
the Company must purchase "access" from the local exchange carriers.  The
Company must generally price its toll services at levels equal to or below the
retail rates established by the local exchange carriers for their own short-
haul or long-haul toll rates.  To the extent that the local exchange carriers
are able to reduce the margin between the access costs to the Company and the
retail toll prices charged by local exchange carriers, either by increasing
access costs or lowering retail toll rates, or both, the Company will encounter
adverse pricing and cost pressures in competing against local exchange carriers
in both the short-haul and long-haul toll markets.

     Under the 1996 Act, local exchange carriers must permit resale of their
bundled local services and unbundled network elements.  General pricing
principles for those services were set forth in the 1996 Act, with states
directed to approve specific tariffs based on these principles.  At the end of
1996, the New York State PSC ("NYSPSC") replaced temporary wholesale discounts
with permanent wholesale discounts of 19.1% for New York Telephone (business
and residential) and 17% for Frontier Corp. (business and residential).  
Discounts were made applicable to centrex, private line and PBX lines.

     On April 1, 1997, the NYPSC adopted permanent rates for unbundled links
and certain other unbundled network elements for New York Telephone.  The
monthly rate for unbundled links in designated areas of dense traffic 
(accounting for approximately 70% of all loops in the state) is $12.49, 
plus a recurring $1.90 connection charge.  The monthly rate in other areas of 
the state is $19.24, plus a $1.90 recurring connection charge.  Permanent 
unbundled link and unbundled network element rates have not yet been 
established for Frontier Corp.  The permanent New York Telephone link rate is 
lower than the temporary rates previously established for New York Telephone's
unbundled links; it is greater than the $10.10 rate for the comparable service
New York Telephone offers to its own residential customers, but below the rate
of approximately $22 for the comparable service New York Telephone offers to
its business customers. However, in order to utilize unbundled links, the
Company must arrange for collocation in New York Telephone's central offices,
which adds significant costs.  As a result, the Company's marketing efforts
are primarily directed toward business customers (and certain concentrated 
residential customers) which can be served through the Company's own 
facilities, rather than through use of unbundled links obtained from New York 
Telephone or Frontier Corp.

     In Canada, the Canadian Radio-television and Telecommunications Commission
("CRTC") annually reviews the "contribution charges" (the equivalent of access
charges in the U.S.) assessed by the dominant carriers for the access lines
leased by Canadian long distance resellers, including the Company, from the
local telephone companies in Canada.  Changes in these contribution charges
could have a material adverse effect on the Company's business, results of
operations and financial condition.  On May 1, 1997 the CRTC issued several
rules intended to encourage increased competition in the telecommunications
and broadcast distribution (cable) industries. Generally, the rules describe
how new service providers can enter the local exchange market, how and when
telephone companies can apply for broadcasting licenses, and the details of
a new methodology that will be used to regulate local telephone rates. The
rules governing entry in the local exchange market cover issues of inter-
connection, resale, subscriber listings, number portability, rate
rebalancing, local service subsidies, rate regulation, service obligations
and cable competition. While certain of the rules appear favorable to the
Company, the rules will likely increase competition in Canadian local exchange
service through new entrants. The Company is unable to predict the extent to
which the full implementation of the rules will have a material adverse effect
on the Company's business, results of operations or financial condition. The
Canadian long distance telecommunications industry is the subject
of ongoing regulatory change.  These regulations and regulatory
decisions have a direct and material effect on the ability of the
Company to conduct its business. The recent trend of such regulatory
changes has been to open the market to commercial competition,
generally to the Company's benefit.  There can be no assurance, however, that
any future changes in or additions to laws, regulations, government policy or
administrative rulings will not have a material adverse effect on the Company's
business, results of operations and financial condition.

     The telecommunications services provided by ACC U.K. are subject to and
affected by regulations introduced by the U.K. telecommunications regulatory
authority, The Office of Telecommunications ("Oftel").  Since the break up of
the U.K. telecommunications duopoly consisting of British Telecom and Mercury
in 1991, it has been the stated goal of Oftel to create a competitive
marketplace from which detailed regulation could eventually be withdrawn.  The
regulatory regime currently being introduced by Oftel has a direct and material
effect on the ability of the Company to conduct its business.  Oftel has
imposed mandatory rate reductions on British Telecom in the past, which are
expected to continue for the foreseeable future, and this has had and may have,
the effect of reducing the prices the Company can charge its customers.  In
addition, the new access charge control regime to be implemented in 1997 could
substantially increase the Company's network costs in the U.K. market,
depending upon the levels at which starting charges and price ceilings are set
by Oftel.  Although the Company is optimistic about its ability to continue to
compete effectively in the U.K. market, there can be no assurance that future
changes in regulation and government will not have a material adverse effect on
the Company's business, results of operations and financial condition.

EXPANSION OF LOCAL EXCHANGE BUSINESS

     The Company anticipates that a significant portion of its growth in its
U.S. operations in the future will come from local exchange operations and
anticipates incurring approximately $13.7 million in capital expenditures during
1997 relating to the installation of additional local exchange switches in the
northeastern United States.  The Company has only limited experience in
providing local telephone services, having commenced providing such services in
1994.  The Company's revenues from local telephone and other services in
North America in 1995 and 1996 were $13.6 million and $26.3 million,
respectively, and $10.8 million and $17.5 million, respectively, for the first
six months of 1996 and 1997.  In order to attract local customers, the
Company must offer substantial discounts from the prices charged by local
exchange carriers and must compete with other alternative local service
companies that offer such discounts.  The local service business requires
significant initial investments in capital equipment as well as significant
initial promotional and selling expenses.  Larger, better capitalized local
service providers, including AT&T, among others, will be better able to sustain
losses associated with discount pricing and initial investments and expenses.
Although the Company's local service business generated a small operating
profit in 1996, it incurred operating losses in 1994 and 1995 and many
companies that compete with the Company's local service business are not
profitable.  There can be no assurance that the Company will continue to
achieve positive cash flow or profitability in its local telephone service
business.  In addition, the FCC and PSCs are considering regulatory changes in
rate structures and access charges which could materially adversely affect the
ability of small interexchange carriers, such as the Company, to compete in the
provision of local service.  See "- Potential Adverse Effects of Regulation."

INCREASING DOMESTIC AND INTERNATIONAL COMPETITION

     The long distance telecommunications industry is highly competitive and is
significantly influenced by the marketing and pricing decisions of the larger
industry participants.  The industry has relatively insignificant barriers to
entry, numerous entities competing for the same customers and high churn rates
(customer turnover), as customers frequently change long distance providers in
response to the offering of lower rates or promotional incentives by
competitors.  In each of its markets, the Company competes primarily on the
basis of price and also on the basis of customer service and its ability to
provide a variety of telecommunications services, including the ability to
provide both intra- and inter-LATA toll service.  The Company expects
competition on the basis of price and service offerings to increase.
Although many of the Company's university customers are under multi-year
contracts, several of the Company's largest customers (primarily other
long distance carriers) are on month-to-month contracts and are particularly
price sensitive.  Revenues from other resellers accounted for approximately
12.7% of consolidated revenues in 1995, 25.2% of consolidated revenues in
1996 and 21% of consolidated revenues in the first six months of 1997.
With respect to these customers, the Company competes almost exclusively
on the basis of price.

     Many of the Company's competitors are significantly larger, have
substantially greater financial, technical and marketing resources and larger
networks than the Company, control more transmission lines and have long-
standing relationships with the Company's target customers.  These competitors
include, among others, AT&T, MCI Telecommunications Corporation ("MCI"), and
Sprint Corp. ("Sprint") in the U.S.; Bell Canada, BC Telecom, Inc., AT&T Canada
Long Distance Services Company ("AT&T Canada") and Sprint Canada (a subsidiary
of Call-Net Telecommunications Inc.) in Canada; and British Telecom, Mercury,
AT&T, and WorldCom, Inc. ("Worldcom") in the U.K. Other U.S. carriers also have
and are expected to enter the U.K. market.  The Company also competes with
numerous other long distance providers, some of which focus their efforts on
the same business customers targeted by the Company and selected residential
customers and colleges and universities, the Company's other target customers.
In addition, through its local telephone service business in upstate New York
and Massachusetts, the Company competes with New York Telephone Company ("New
York Telephone"), Frontier Corp., Citizens Telephone Co., WorldCom and Time
Warner and others, including cellular and other wireless providers.
Furthermore, corporate transactions such as the proposed merger of Bell
Atlantic Corp. and NYNEX Corp., the proposed merger of MCI and British Telecom,
the joint venture between MCI and Microsoft Corporation ("Microsoft") under
which Microsoft will promote MCI's services, the joint venture among Sprint,
Deutsche Telekom AG and France Telecom called Global One, the recently
announced joint venture among British Telecom, MCI and Telefonica de Espana SA,
and additional mergers, acquisitions and strategic alliances which are likely
to occur, could also increase competitive pressures upon the Company and have a
material adverse effect on the Company's business, results of operations and
financial condition.

     In addition to these competitive factors, recent and pending deregulation
in each of the Company's markets may encourage new entrants.  For example, as a
result of the 1996 Act, RBOCs are allowed to enter the long distance market,
AT&T, MCI and other long distance carriers are allowed to enter the local
telephone services market, and any entity (including cable television companies
and utilities) is allowed to enter both the local service and long distance
telecommunications markets.  In addition, the FCC has, on several occasions
since 1984, approved or required price reductions by AT&T and, in 1995 and
1996, the FCC reclassified AT&T as a "non-dominant" carrier, which
substantially reduces the regulatory constraints on AT&T.  As the Company
expands its geographic coverage, it will encounter increased competition.
Moreover, the Company believes that competition in non-U.S. markets is likely
to increase and become more similar to competition in U.S. markets over time as
such non-U.S. markets continue to experience deregulatory influences.  The WTO
accord reached in February 1997 is likely to accelerate this trend in some
markets.  Prices in the long distance industry have declined from time to time
in recent years and are likely to continue to decrease.  For example, Bell
Canada substantially reduced its rates during the first quarter of 1994 and
British Telecom substantially reduced its rates in 1996.  The Company's
competitors may reduce rates or offer incentives to existing and potential
customers of the Company.  AT&T, in particular, has experienced sharp declines
in its market share over recent years and may make aggressive pricing decisions
in an effort to halt or reverse this decline.  To maintain its competitive
position, the Company believes that it must be able to reduce its prices in
order to meet reductions in rates, if any, by others.  See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."


RISKS OF GROWTH AND EXPANSION

     The Company plans to expand its service offerings and principal geographic
markets in the United States, Canada and the United Kingdom.  In addition, the
Company intends to establish a presence in deregulating Western European
markets that have high density telecommunications traffic, when the Company
believes that business and regulatory conditions warrant.  The Company 
has entered the German market as a switchless reseller in anticipation of
deregulation in 1998, and has established a German subsidiary.  There can
be no assurance, however, that the Company will be able to add service or
expand its markets at the rate presently planned by the Company or that the
existing regulatory barriers to such expansion will be reduced or eliminated.
The Company's rapid growth has placed, and in the future may continue to place,
a significant strain on the Company's administrative, operational and financial
resources and increased demands on its systems and controls.  As the Company
increases its service offerings and expands its targeted markets, there will be
additional demands on the Company's customer support, sales and marketing and
administrative resources and network infrastructure.  There can be no assurance
that the Company's operating and financial control systems and infrastructure
will be adequate to maintain and effectively monitor future growth. The failure
to continue to upgrade the administrative, operating and financial control
systems or the emergence of unexpected expansion difficulties could materially
adversely affect the Company's business, results of operations and financial
condition.

RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS

     A key component of the Company's strategy is its planned expansion in
Western European markets.  In the WTO accord reached in February 1997, a number
of countries agreed to accelerate or initiate liberalization of their
telecommunications markets by allowing increased competition and foreign
ownership of telecommunications providers and by adopting measures to ensure
reasonable nondiscriminatory interconnection, effective competitive safeguards,
and an effective independent regulation.  This agreement may, therefore, expand
the international opportunities available to the Company.  To date, the Company
has no significant experience in providing telecommunications service outside
the United States, Canada and the U.K.  The Company is making preparations to
enter the emerging German market in anticipation of deregulation in 1998. There
can be no assurance, however, that the Company will be able to obtain the
capital it requires to finance its expansion in international markets on
satisfactory terms or at all.  In many international markets, protective
regulations and long-standing relationships between potential customers of the
Company and their local providers create barriers to entry.  Where protective
regulations are being eliminated, the pro-competitive effect of this action
could substantially increase the number of entities competing with the Company.
Pursuit of international growth opportunities may require significant
investments for an extended period before returns, if any, on such investments
are realized.  The Company intends to focus in the near term on the expansion
of its service offerings, including its local telephone business and Internet
services, and expanding its geographic markets to more locations in its
existing markets, and when conditions warrant, to deregulating Western European
markets.  Such expansion, particularly the establishment of new operations or
acquisition of existing operations in deregulating international markets, may
adversely affect cash flow and operating performance and these effects may be
material, as was the case with the Company's U.K. operations in 1994 and 1995.
In addition, there can be no assurance that the Company will be able to obtain
the permits and operating licenses required for it to operate, hire and train
employees or to market, sell and deliver high quality services in these
international markets.  In addition to the uncertainty as to the Company's
ability to expand its international presence, there are certain risks inherent
to doing business on an international level, such as unexpected changes in
regulatory requirements, tariffs, customs, duties and other trade barriers,
difficulties in staffing and managing foreign operations, longer payment
cycles, problems in collecting accounts receivable, political risks,
fluctuations in currency exchange rates, foreign exchange controls which
restrict or prohibit repatriation of funds, technology export and import
restrictions or prohibitions, delays from customs brokers or government
agencies, seasonal reductions in business activity during the summer months in
Europe and certain other parts of the world and potentially adverse tax
consequences resulting from operating in multiple jurisdictions with different
tax laws, which could materially adversely impact the success of the Company's
international operations.  In many countries, the Company may need to enter
into a joint venture or other strategic relationship with one or more third
parties in order to successfully conduct its operations.  There are risks in
participating in joint ventures, including the risk that the other participant
in the joint venture may at any time have economic, business or legal interests
that are inconsistent with those of the joint venture or the Company.  As its
revenues from its Canadian and U.K. operations increase and as it establishes
operations in other countries, an increasing portion of the Company's revenues
will be denominated in currencies other than U.S. dollars, although a
significant portion of the Company's interest expense may be denominated in
U.S. dollars.  Therefore, changes in exchange rates (particularly a
strengthening of the U.S. dollar) will have a greater effect on the Company's
results of operations.  There can be no assurance that such factors will not
have a material adverse effect on the Company's future operations and,
consequently, on the Company's business, results of operations and financial
condition.  In addition, there can be no assurance that laws or administrative
practices relating to taxation, foreign exchange or other matters of countries
within which the Company operates will not change.  Any such change could have
a material adverse effect on the Company's business, financial condition and
results of operations.

DEPENDENCE ON EFFECTIVE INFORMATION SYSTEMS

     To complete its billing, the Company must record and process massive
amounts of data quickly and accurately.  The Company believes that the
successful implementation and integration of new information systems is
important to its continued growth and its ability to monitor costs, to bill
customers and to achieve operating efficiencies, but there can be no assurance
that the Company will not encounter delays or cost-overruns or suffer adverse
consequences in implementing the systems.  In addition, as the Company's
suppliers revise and upgrade their hardware, software and equipment technology,
there can be no assurance that the Company will not encounter difficulties in
integrating the new technology into the Company's systems or that the new
systems will be appropriate for the Company's business.

RISKS ASSOCIATED WITH ACQUISITIONS, INVESTMENTS AND STRATEGIC ALLIANCES

     As part of its business strategy, the Company expects to seek to develop
strategic alliances both domestically and internationally and to acquire assets
and businesses or make investments in companies that are complementary to its
current operations.  The Company has no present commitments or agreements with
respect to any material strategic alliance, investment or acquisition. Any such
future strategic alliances, investments or acquisitions would be accompanied by
the risks commonly encountered in strategic alliances with or acquisitions of
or investments in companies.  Such risks include, among other things, the
difficulty of assimilating the operations and personnel of the companies, the
potential disruption of the Company's ongoing business, the difficulty of
successfully incorporating licensed or acquired technology and rights into the
Company's service offerings, the maintenance of uniform standards, controls,
procedures and policies and the impairment of relationships with employees and
customers as a result of changes in management.  In addition, the Company has
in the past experienced higher attrition rates with respect to customers
obtained through acquisitions, and may again experience higher attrition rates
with respect to any customers resulting from future acquisitions.  Moreover, to
the extent that any such acquisition, investment or alliance involved a
business located outside the United States, the transaction would involve the
risks associated with international expansion discussed above under "Risks
Associated with International Operations."

There can be no assurance that the Company would be successful in overcoming
these risks or any other problems encountered with such strategic alliances,
investments or acquisitions.

     In addition, if the Company were to proceed with one or more significant
strategic alliances, acquisitions or investments in which the consideration
consists of cash, a substantial portion of the Company's available cash could
be used to consummate the strategic alliances, acquisitions or investments.
Many of the businesses that might become attractive acquisition candidates for
the Company may have significant goodwill and intangible assets, and
acquisitions of these businesses, if accounted for as a purchase, would
typically result in substantial amortization charges to the Company.  The
financial impact of acquisitions, investments and strategic alliances could
have a material adverse effect on the Company's business, financial condition
and results of operations and could cause substantial fluctuations in the
Company's quarterly and yearly operating results.

TECHNOLOGICAL CHANGES MAY ADVERSELY AFFECT COMPETITIVENESS AND FINANCIAL
RESULTS

     The telecommunications industry is characterized by rapid and significant
technological advancements and introductions of new products and services
utilizing new technologies.  There can be no assurance that the Company will
maintain competitive services or that the Company will obtain appropriate new
technologies on a timely basis or on satisfactory terms.

RISKS ASSOCIATED WITH RAPIDLY CHANGING INDUSTRY

     The international telecommunications industry is changing rapidly due to,
among other things, deregulation, privatization of dominant telecommunications
providers, technological improvements, expansion of telecommunications
infrastructure and the globalization of the world's economies and free trade.
There can be no assurance that one or more of these factors will not vary
unpredictably, which could have a material adverse effect on the Company.
There can also be no assurance, even if these factors turn out as anticipated,
that the Company will be able to implement its strategy or that its strategy
will be successful in this rapidly evolving market.  There can be no assurance
that the Company will be able to compete effectively or adjust its contemplated
plan of development to meet changing market conditions.

     Much of the Company's planned growth is predicated upon the deregulation
of telecommunications markets.  There can be no assurance that such
deregulation will occur when or as anticipated, if at all, or that the Company
will be able to grow in the manner or at the rates currently contemplated.

     As a result of existing excess international transmission capacity, the
marginal cost of carrying an additional international call is often very low
for carriers that own transmission lines.  Industry observers have predicted
that these low marginal costs may result in significant pricing pressures and
that, within a few years after the end of this century, there may be no charges
based on the distance a call is carried.  Certain of the Company's competitors
have introduced calling plans that provide for flat rates on calls within the
U.S. and Canada, regardless of time of day or distance of the call.  If this
type of pricing were to become prevalent, it would have a material adverse
effect on the Company's business, financial condition and results of
operations.

DEPENDENCE ON KEY PERSONNEL

     The Company's success depends to a significant degree upon the continued
contributions of its management team and technical, marketing and sales
personnel.  The Company's employees may voluntarily terminate their
employment with the Company at any time. Competition for qualified
employees and personnel in the telecommunications industry is intense
and, from time to time, there are a limited number of persons with
knowledge of and experience in particular sectors of the telecommunications
industry.  The Company's success also will depend on its ability to
attract and retain qualified management, marketing, technical and
sales executives and personnel.  The process of locating such personnel with
the combination of skills and attributes required to carry out the Company's
strategies is often lengthy.  The loss of the services of key personnel, or the
inability to attract additional qualified personnel, could have a material
adverse effect on the Company's results of operations, development efforts and
ability to expand.  There can be no assurance that the Company will be
successful in attracting and retaining such executives and personnel.  Any such
event could have a material adverse effect on the Company's business, financial
condition and results of operations.

RISKS ASSOCIATED WITH FINANCING ARRANGEMENTS; DIVIDEND RESTRICTIONS

     The Company's financing arrangements are secured by substantially all of
the Company's assets and require the Company to maintain certain financial
ratios and restrict the payment of dividends, and the Company anticipates that
it will not pay any dividends on Class A Common Stock in the foreseeable
future.  The Company's secured lenders would be entitled to foreclose upon
those assets in the event of a default under the financing arrangements and to
be repaid from the proceeds of the liquidation of those assets before the
assets would be available for distribution to the Company's other creditors and
shareholders in the event that the Company is liquidated.  In addition, the
collateral security arrangements under the Company's existing financing
arrangements may adversely affect the Company's ability to obtain additional
borrowings or other capital.  The Company may need to raise additional capital
from equity or debt sources to finance its projected growth and capital
expenditures contemplated for periods after 1996.  See the Risk Factor
discussion above under "Substantial Indebtedness; Need for Additional Capital"
and "Management's Discussion and Analysis of Financial Condition and Results of
Operations - Liquidity and Capital Resources."

HOLDING COMPANY STRUCTURE; RELIANCE ON SUBSIDIARIES FOR DIVIDENDS

     ACC Corp. is a holding company, the principal assets of which are its
operating subsidiaries in the U.S., Canada and the U.K.  ACC U.S., ACC Canada,
ACC U.K. and other operating subsidiaries of the Company are subject to
corporate law restrictions on their ability to pay dividends to ACC Corp. There
can be no assurance that ACC Corp. will be able to cause its operating
subsidiaries to declare and pay dividends or make other payments to ACC Corp.
when requested by ACC Corp. The failure to pay any such dividends or make any
such other payments could have a material adverse effect upon the Company's
business, financial condition and results of operations.

POTENTIAL VOLATILITY OF STOCK PRICE

     The market price of the Class A Common Stock has been and may continue to
be, highly volatile.  Factors such as variations in the Company's revenue,
earnings and cash flow, the difference between the Company's actual results and
the results expected by investors and analysts, "buy," "hold" and "sell"
ratings by securities analysts and announcements of new service offerings,
marketing plans or price reductions by the Company or its competitors could
cause the market price of the Class A Common Stock to fluctuate substantially.
In addition, the stock markets recently have experienced significant price and
volume fluctuations that particularly have affected telecommunications
companies and resulted in changes in the market prices of the stocks of many
companies that have not been directly related to the operating performance
of those companies.  Such market fluctuations may materially adversely
affect the market price of the Class A Common Stock.


RISKS ASSOCIATED WITH DERIVATIVE FINANCIAL INSTRUMENTS

     In the normal course of business, the Company uses various financial
instruments, including derivative financial instruments, to hedge its foreign
exchange and interest rate risks.  The Company does not use derivative
financial instruments for speculative purposes.  By their nature, all such
instruments involve risk, including the risk of nonperformance by
counterparties, and the Company's maximum potential loss may exceed the amount
recognized on the Company's balance sheet.  Accordingly, losses relating to
derivative financial instruments could  have a material adverse effect upon the
Company's business, financial condition and results of operations.  See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

CURRENCY RISKS; POSSIBLE EFFECT ON FINANCIAL CONDITION, OPERATING RESULTS AND
FINANCING COSTS; EXCHANGE CONTROLS

     A significant portion of the Company's assets, sales and earnings are
attributable to operations conducted in Canada and the United Kingdom and, in
the future, the Company may increase the amount of business it conducts in
jurisdictions outside the United States.  Consequently, a significant portion
of the Company's revenues and expenses are, and, in the future, are expected to
continue to be, denominated in non-U.S. currencies.  Fluctuations in exchange
rates relative to the U.S. dollar may have a material adverse effect upon the
Company's business, financial condition or results of operations and could
adversely affect the effective interest rate on the Company's U.S. denominated
indebtedness.  To the extent the operating subsidiaries distribute dividends
in non-U.S. currencies in the future, the amount of cash to be received
by ACC Corp. will be affected by fluctuations in exchange rates. In addition,
certain countries in which the Company may commence operations restrict the
expatriation or conversion of currency. See "-Risks Associated with
Derivative Financial Instruments"  and "Management's Discussion and Analysis
of Financial Condition and Results of Operations."

INTERNATIONAL TAX RISKS

     Distributions of earnings and other payments (including interest) received
from the Company's operating subsidiaries and affiliates may be subject to
withholding taxes imposed by the jurisdictions in which such entities are
formed or operating, which will reduce the amount of after-tax cash the Company
can receive from its operating companies.  In general, a U.S. corporation may
claim a foreign tax credit against its federal income tax expense for such
foreign withholding taxes and for foreign income taxes paid directly by foreign
corporate entities in which the Company owns 10% or more of the voting stock.
The ability to claim such foreign tax credits and to utilize net foreign losses
is, however, subject to numerous limitations, and the Company may incur
incremental tax costs as a result of these limitations or because the Company
is not in a tax-paying position in the United States.

     The Company may also be required to include in its income for U.S. federal
income tax purposes its proportionate share of certain earnings of those
foreign corporate subsidiaries that are classified as "controlled foreign
corporations" without regard to whether distributions have been actually
received from such subsidiaries.


RISKS OF ENTRY INTO CELLULAR BUSINESS AND EXPANSION OF INTERNET, PAGING AND
DATA TRANSMISSION BUSINESSES

     The Company believes that offering a full-service portfolio of local, long
distance, data transmission and other services is an effective strategy for
building upon its market position and obtaining economies of scale in its
network and other areas.  However, the Company has only limited experience in
providing local exchange, Internet, paging and data transmission services in
selected markets, and is considering entering the cellular business in Canada
when market conditions warrant.  The Company may be required to make
significant operating and capital investments in order to provide these
services.  There are numerous operating complexities associated with providing
these services.  The Company will be required to develop new products, services
and systems and new marketing initiatives for selling these services and will
also need to implement the necessary billing and collecting systems.  The
Company may face significant competitive product and pricing pressures in
providing these services and entering new markets, and there can be no
assurance that the Company's strategy will be successful.



