

                            FORM 10-Q

               SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549

(X)  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
     ENDED JUNE 30, 1997.

( )  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
     FROM _______ TO _______

Commission file number  0-14567


                            ACC CORP.
     (Exact name of registrant as specified in its charter)


            Delaware                          16-1175232
(State or other jurisdiction of             (IRS Employer
incorporation or organization)            Identification No.)


           400 West Avenue, Rochester, New York  14611
            (Address of principal executive offices)


                         (716) 987-3000
      (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has 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 registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

Yes   X                      No

As of  August 1, 1997, the Registrant had issued and outstanding
16,803,665 shares of its Class A Common Stock, par value $.015
per share.

The Index of Exhibits filed with this Report is found at Page 30.
PART I.   FINANCIAL INFORMATION

Item 1.   FINANCIAL STATEMENTS






<TABLE>
ACC CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(Amounts in thousands, except share and per share data)

                                                Three months ended      Six months ended
                                                    June 30,                June 30,
<CAPTION>
                                                 1997      1996         1997      1996

Revenue:
   <S>                                         <C>       <C>         <C>       <C>
   Toll revenue                                $80,837   $74,600     $154,677  $136,137
   Local service and other                       8,664     5,489       17,476    10,805
                                                89,501    80,089      172,153   146,942

Network costs                                   53,520    53,380      102,136    94,988

Gross profit                                    35,981    26,709       70,017    51,954

Other operating expenses:
  Depreciation and amortization                  5,348     4,176       10,479     7,795
  Selling, general and administrative           24,766    19,354       48,300    37,989
                                                30,114    23,530       58,779    45,784

 Income from operations                          5,867     3,179       11,238     6,170

Other income (expense):
  Net Interest                                    (689)     (910)      (1,340)   (2,434)
  Foreign exchange gain (loss)                     (36)       14         (188)       26
                                                  (725)     (896)      (1,528)   (2,408)

 Income before provision for income
   taxes and minority interest                   5,142     2,283        9,710     3,762

 Provision for  income taxes                       778       529        1,294       853

 Income before minority interest                 4,364     1,754        8,416     2,909

Minority interest in (earnings) of
  consolidated subsidiary                            0      (296)           0      (596)

 Net income                                      4,364     1,458        8,416     2,313
 Less Series A preferred stock dividend              0      (339)           0      (638)
 Less Series A preferred stock accretion             0      (416)           0      (624)

 Income applicable to common stock              $4,364      $703       $8,416    $1,051

Earnings per common and common
     equivalent share                            $0.25     $0.05        $0.48     $0.08

</TABLE>
ACC CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share data)
UNAUDITED
 
                                               June 30, December 31,
                                                 1997      1996


CURRENT ASSETS:
Cash and cash equivalents                           $0      $2,035
Accounts receivable, net of allowance
for doubtful accounts of $3,612 in
1997 and $3,795 in 1996                         56,442      51,474
Other receivables                                3,057       3,792
Prepaid expenses and other assets                6,584       4,632
TOTAL CURRENT ASSETS                            66,083      61,933

PROPERTY, PLANT, AND EQUIPMENT
At cost                                        135,964     119,398
Less-accumulated depreciation and
amortization                                   (45,472)    (38,946)
TOTAL PROPERTY, PLANT, AND EQUIPMENT            90,492      80,452

OTHER ASSETS:
Goodwill and customer base, net                 51,770      50,629
Deferred installation costs, net                 4,795       4,312
Other                                           11,614       6,705
TOTAL OTHER ASSETS                              68,179      61,646

TOTAL ASSETS                                  $224,754    $204,031


                                               June 30, December 31,
                                                  1997      1996


CURRENT LIABILITIES:
Notes payable                                     $277        $730
Current maturities of
long-term debt                                   2,417       3,521
Accounts payable                                14,778      15,351
Accrued network costs                           25,470      22,908
Other accrued expenses                          17,058      34,884
TOTAL CURRENT LIABILITIES                       60,000      77,394

Deferred income taxes                            3,186       2,767

Long-term debt                                  33,419       6,007


SHAREHOLDERS' EQUITY:
Preferred Stock, $1.00 par value, Authorized -
1,990,000 shares; Issued - no shares                 -           -
Class A Common Stock, $.015 par value
Authorized - 50,000,000 shares;
Issued - 17,828,159 in 1997 and
17,684,361  in 1996                                268         265
Class B Common Stock, $.015 par value,
Authorized - 25,000,000 shares;
Issued - no shares                                   -           -
Capital in excess of par value                 118,831     116,878
Cumulative translation adjustment               (1,448)     (1,362)
Retained earnings                               12,108       3,692
                                               129,759     119,473
Less-
Treasury stock, at cost (1,089,884
shares in 1997 and 1996)                        (1,610)     (1,610)
TOTAL SHAREHOLDERS' EQUITY                     128,149     117,863

TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY                          $224,754    $204,031

<TABLE>
ACC CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(Amounts in 000's)
                                                             FOR THE SIX MONTHS ENDED
                                                                     JUNE 30,
<CAPTION>
                                                                 1997       1996
CASH FLOWS FROM OPERATING ACTIVITIES
 <S>                                                            <C>       <C>
 Net income                                                     $8,416    $2,313

 Adjustments to reconcile net income  to net cash provided by
   operating activities:
   Depreciation and amortization                                10,479     7,795
   Deferred income taxes                                         1,538      (106)
   Minority interest in earnings  of consolidated subsidiary                 596
   Unrealized foreign exchange loss                                (26)      (42)
   Amortization of deferred financing costs                        278         0
   (INCREASE) DECREASE IN ASSETS:
      Accounts receivable, net                                  (4,871)  (11,573)
      Other receivables                                           (546)    1,434
      Prepaid expenses and other assets                         (1,972)     (106)
      Deferred installation costs                               (1,725)   (1,476)
      Other                                                     (4,299)     (154)
   INCREASE (DECREASE) IN LIABILITIES:
      Accounts payable                                          (1,446)   (1,113)
      Accrued network costs                                      2,719     1,506
      Other accrued expenses                                   (17,769)      445

        Net cash provided by (used in) operating activities     (9,224)     (481)

CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures, net                                    (17,611)   (9,659)
  Payment for purchase of subsidiary, net of cash acquired      (1,850)
  Acquisition of customer base                                    (465)   (2,193)
       Net cash used in investing activities                   (19,926)  (11,852)

CASH FLOWS FROM FINANCING ACTIVITIES:
  Borrowings under lines of credit and notes payable            84,443    19,500
  Repayments under lines of credit and notes payable           (53,100)  (41,883)
  Repayment of long-term debt, other than lines of credit       (5,462)   (1,554)
  Proceeds from issuance of common stock                         1,956    66,385
  Financing costs                                               (1,273)        0

        Net cash provided by financing activities               26,564    42,448

Effect of exchange rate changes on cash                            551      (253)

Net increase (decrease) in cash from operations                 (2,035)   29,862

Cash and cash equivalents at beginning of period                 2,035       518

Cash and cash equivalents at end of period                          $0   $30,380

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
  Interest                                                      $1,371    $1,798
  Income taxes                                                    $920      $958

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
 Fair Value of Transphone assets acquired other than cash       $3,777        $0
 Fair value of Transphone liabilities assumed                        0         0
    Net cash paid                                               $1,850        $0
</TABLE>


ACC CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

June 30, 1997

1.        Statement of Management

          The condensed financial statements of ACC Corp. and subsidiaries
(the "Company") included herein have been prepared by the Company, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission (the "SEC").  Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company believes that
the disclosures are adequate to make the information presented not
misleading. These condensed financial statements be read in conjunction
with the financial statements and the notes thereto included in the
Company's latest Annual Report on Form 10-K.

          The interim financial statements contained herein reflect all
adjustments of a normal recurring nature which are, in the opinion of
management, necessary to a fair statement of the results of operations for
the interim periods presented.

          As used herein, unless the context otherwise requires, the
"Company" and "ACC" refer to ACC Corp. and its subsidiaries, including its
U.S. operating subsidiaries("ACC U.S."), ACC TelEnterprises Ltd.("ACC
Canada"), ACC Long Distance UK Ltd. ("ACC U.K."), and ACC
Telecommunications GmbH ("ACC Germany").  In this Form 10-Q, references to
"dollar" and "$" are to United States dollars, references to "Cdn. $" are
to Canadian dollars, references to "pound" are to English pounds sterling,
references to "DM" are to German Deutchmarks, 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.  "North American Operations" includes operations in the
United States and Canada, while "Europe Operations" includes operations in
the United Kingdom and Germany operations.

2.        Form 10-K

          Reference is made to the following footnotes included in the
Company's 1996 Annual Report on Form 10-K:

          Principles of Consolidation
          Minority Interest
          Revenue
          Other Receivables
          Property, Plant and Equipment
          Deferred Costs
          Goodwill and Customer Base
          Common and Common Equivalent Shares
          Foreign Currency Translation
          Income Taxes
          Cash Equivalents
          Derivative Financial Instruments
          Financial Instruments
          Stock-Based Compensation
          Use of Estimates
          Reclassifications
          Description of Business
          Equal Access Costs
          Debt
          Senior Credit Facility and Lines of Credit
          Working Capital Lines of Credit
          Income Taxes
          Redeemable Preferred Stock
          Public Offerings
          Private Placement
          Stock-Based Compensation
          Employee Long-Term Incentive Plan
          Employee Stock Purchase Plan
          Non-Employee Directors' Stock Option Plan
          United Kingdom Sharesave Scheme
          Treasury Stock
          Operating Leases
          Employment and Other Agreements
          Purchase Commitments
          Defined Contribution Plans
          Annual Incentive Plan
          Legal Matters
          Geographic Area Information
          Related Party Transactions

3.    Net Income Per Share

      Net income per common and common equivalent share is computed on the
basis of the weighted average number of common and common equivalent shares
outstanding during the period and net income reduced by preferred dividends
and accreted costs.  The average number of shares outstanding (1996 data
retroactively restated for a three-for-two stock split as of August 8,
1996) is computed as follows:

                               For the Three Months       For the Six Months
                               Ended June 30,               Ended June 30,

Average Number Outstanding:    1997       1996          1997        1996

Common Shares                 16,726,483  14,006,467    16,690,640  12,984,746
Common Equivalent Shares         707,503   1,104,422       794,888   1,025,529

TOTAL                         17,433,986  15,110,889    17,485,528  14,010,275

Fully diluted income per share amounts are not presented for the prior
period because inclusion of these amounts would be anti-dilutive.  Fully
diluted income per share amounts for the current period do not differ
materially from primary earnings per share amounts.

4.   Recently issued accounting standards

SFAS No. 128

In March 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard No. 128, "Earnings per Share,"
which is applicable to the Company beginning in the fourth quarter of 1997.
This statement, upon adoption, will require all prior-period earnings per
share ("EPS") data to be restated, to conform to the provisions of the
statement. The statement will eliminate the disclosure of primary earnings
per share which includes the dilutive effect of stock options, warrants and
other convertible securities ("Common Stock Equivalents") and instead
requires reporting of "basic" earnings per share, which will exclude Common
Stock Equivalents.  Additionally, the statement changes the methodology for
fully diluted earnings per share.  In the opinion of the Company's
management, the adoption of this new accounting standard will not have a
material effect on the reported earnings per share of the Company.

     While the Statement prohibits early adoption, pro forma presentation
of the impact of the Statement for the reporting periods is illustrated
below:

<TABLE>
          Pro Forma Earnings Per Share Computation under FAS 128
          
                                 Three Months ended                                     Six Months ended
                               June  30,1997 and 1996                                  June 30, 1997 and 1996
                            (amounts in thousands except                             (amounts in thousands except
                            share and per share amounts)                              share and per share amounts)
  

                               1997                         1996                         1997                       1996
<CAPTION>
                    Income  Shares  Per Share    Income  Shares  Per Share    Income  Shares  Per Share    Income Shares Per Share

Basic EPS
<S>                 <C>    <C>         <C>       <C>    <C>           <C>    <C>    <C>         <C>       <C>
Net income          $4,364                       $1,458                      $8,416                       $2,313
Less:  preferred
stock dividends
and preferred
stock accretion           -                        (755)                             -                    (1,262)
Income available to
common shareholders $4,364 16,726,483   $.26     $  703 14,006,467    $.05   $8,416 16,690,640  $.50     $ 1,051 12,984,746  $.07

Diluted EPS
Add:  Options and
       warrants         -     707,503     -              1,104,422               -     794,888            -       1,025,529
Income available to
common shareholders $4,364 17,433,986   $.25     $  703 15,110,889    $.05   $8,416 17,485,528  $.48     $ 1,051 14,010,275  $.07
</TABLE>

     Pro forma basic earnings per common share were computed by
dividing net income by weighted average number of shares of
common stock outstanding during the quarter.  The pro forma
dilutive effect of options and warrants reflects application of
the treasury stock method, utilizing average market prices during
the period, and excludes any assumed exercise that would have
been antidilutive.  Assumed conversion of outstanding redeemable
and convertible preferred stock at June 30,1996 was excluded from
the above, as the effect would have been antidilutive.

SFAS No. 130

In June 1997, the FASB issued Statement of Financial Accounting
Standard No. 130, "Reporting Comprehensive Income", which is
applicable to the Company effective January 1, 1998.  This
Statement establishes standards for reporting and display of
comprehensive income and its components (revenues, expenses,
gains and losses)in a full set of general purpose financial
statements.  Comprehensive income is defined as the change in the
equity of a business enterprise during a period from transactions
and other events and circumstances from nonowner sources.  It
includes all changes in equity during a period (from net income
and other sources) except those resulting from investments by owners
and distributions to owners.  Management believes that the adoption
of this statement will not have a material effect on the
Company's consolidated results of operations or financial
position.

SFAS No. 131

In June 1997, the FASB issued Statement of Financial Accounting
Standard No. 131, "Disclosures about Segments of an Enterprise
and Related Information", which is applicable to the Company
effective January 1,1998.  This Statement requires that a public
business enterprise report financial and descriptive information
about its reportable operating segments.  Operating segments are
components of an enterprise about which separate financial information
is available that is evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and in assessing
performance.  The Statement requires disclosure of a measure of segment
profit or loss, certain specific revenue and expense items, and segment
assets.  It requires reconciliations of total segment revenues,
total segment profit or loss, total segment assets, and other
amounts disclosed for segments to corresponding amounts in the
enterprise's general purpose financial statements.  It requires that
all public business enterprises report information about the revenues
derived from the enterprise's products or services, about the countries
in which the enterprise earns revenues and holds assets, and about
major customers regardless of whether that information is used in
making operating decisions.  Management believes that the
adoption of this statement will not have a material effect on the
Company's consolidated results of operations or financial
position.

5.   Senior Credit Facility

     Under the terms of the five-year senior revolving credit
facility agreement of July 21, 1995, the Company was obligated to
pay the financial institution an aggregate contingent interest
payment based on the minimum of $750,000 or the appreciation in
value of 140,000 shares of the Company's Class A Common Stock
over the 18 month period ending January 21, 1997, but not to
exceed $2.1 million.  A payment of $2.1 million was made on
January 15, 1997 in conjunction with the amendment to the credit
facility, and was reflected as an accrued expense on the balance
sheet at December 31, 1996.

     On January 14, 1997, the Company signed an agreement with
the same financial institution to provide a $100 million credit
facility to the Company which amended and restated the previous
$35 million credit facility. The amended credit facility was
syndicated among five financial institutions.  Borrowings can be
made in U.S. dollars, Canadian dollars and British pounds, and
are limited individually to $30 million for ACC Canada, $20
million for ACC U.K. and $15 million for the Company's local
exchange business in the U.S., with total borrowings for the
Company limited to $100 million.  The amended facility will be
used to finance capital expenditures, provide working capital and
to provide capital for acquisitions. The maximum aggregate
principal amount of the amended facility is required to be
reduced by $8 million per quarter commencing on March 31, 1999
until December 31, 2000, and by $9 million per quarter commencing
on March 31, 2001 until maturity of the loan in January 2002.

6.  Business Combinations

On May 30, 1997 ACC U.K. acquired Transphone International Ltd.
("Transphone") in a business combination accounted for as a
purchase.  Transphone, a long distance reseller, is based in
London, United Kingdom, and provides international and domestic
long distance services. Transphone reported 1.5 million pounds (U.S.
$2.4 million) annual revenues for the year ended December 31,
1996. The results of operations of Transphone are included in the
accompanying financial statements since the date of acquisition,
and the impact on results of operations for the quarter ended
June 30, 1997 was not material.  On May 30, 1997 ACC U.K. paid
1.1 million pounds (U.S. $1.8 million) for 100% of the outstanding
common stock of Transphone.  The fair value of assets acquired
was 2.3 million pounds (U.S. $3.8 million) and liabilities assumed were
1.2 million pounds (U.S. $1.9 million).  Goodwill associated with the
purchase of 0.8 million pounds (U.S. $1.3 million) is being amortized
over 20 years, and customer base of 1.1 million pounds (U.S. $1.8
million) is being amortized over 5 years.  (Note:  U.S. dollar
equivalent amounts noted above are estimated based on the May 30,
1997 exchange rate).

On July 15, 1997 ACC U.K. acquired United Telecom Ltd. ("UT") in
a business combination which will be accounted for as a purchase.
UT, a pre-paid calling card and long distance services provider, is
based in London U.K..  The results of operations of UT will be
reflected in the third quarter results of operations effective 7/1/97.
The difference in results of operations from July 1 to July 15, 1997
is deemed not material.  UT reported annual revenues of 2.8
million pounds (US $4.5 million) for the fiscal year ended April 30,
1997.  On July 15, 1997 ACC U.K. paid 2.5 million pounds (US $4.1
million) for 100% of the outstanding common stock of UT.  The
former shareholders of UT may earn additional purchase price
consideration of up to 1.0 million pounds (U.S. $1.6 million) if
certain profit objectives are attained during 1998.  The fair
value of assets acquired was 4.7 million pounds (US $7.7 million) and
liabilities assumed were 2.2 million pounds (US $3.6 million).
Goodwill associated with the purchase of 2.9 million pounds (US $4.7
million) will be amortized over 20 years, and customer base of
0.6 million pounds (US $1.0 million) will be amortized over 5 years.
(Note:  U.S. dollar equivalent amounts noted above are estimated
based on the July 15, 1997 exchange rate).

7.   Derivative Financial Instruments

The Company uses derivative financial instruments to reduce
its exposure to market risks from changes in foreign
exchange rates and interest rates.  The Company does not
hold or issue financial instruments for speculative
purposes.  The derivative instruments used are currency
forward contracts and interest rate swap agreements.  These
derivatives are non-leveraged and involve little complexity.
The Company enters into contracts to buy and sell foreign
currencies in the future in order to protect the U.S. dollar
value of certain currency positions and future foreign
currency transactions.  The fair value method is used to
account for these instruments.  Under the fair value method,
changes in fair value are recognized in the consolidated
balance sheet as a component of other accrued expenses, and
in the consolidated income statement as foreign currency
gain or loss.  For reporting purposes, the contractual
assets or liabilities of the foreign currency agreements are
offset because the agreements provide for a right of offset.
Any premiums or discounts related to foreign currency
contracts are amortized over the life of the contracts.
The Company enters into cross-currency rate swaps to hedge
intercompany debt from certain subsidiaries.  Under these
agreements, the Company typically pays a fixed rate of
interest on a foreign dollar note, and receives a variable
rate of interest on a U.S. dollar receivable.  The fair
value method is used to account for these instruments.
Under the fair value method, the amounts receivable and
payable are carried at their fair value on the consolidated
balance sheet as a component of other receivables.  Changes
in the fair value are recognized in the consolidated income
statement as foreign currency gain or loss.  Interest due
under the fixed contracts and interest receivable under the
variable contracts are recognized in the consolidated income
statement as a component of net interest expense.


Item 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
              CONDITION AND RESULTS OF OPERATIONS

     The following discussion includes certain forward-looking
statements.  Such forward-looking statements are subject to
material risks and uncertainties and other factors.  For a
discussion of material risks and uncertainties and other factors
that could cause actual results to differ materially from the
forward-looking statements, see "Recent Losses; Potential
Fluctuations in Operating Results," "Substantial Indebtedness;
Need for Additional Capital," "Dependence on Transmission
Facilities-Based Carriers," "Potential Adverse Effects of
Regulation," "Increasing Domestic and International Competition,"
"Expansion of Local Exchange Business," "Risks of Growth and
Expansion," "Risks Associated with International Operations,"
"Dependence on Effective Information Systems," "Risks Associated
With Acquisitions, Investments and Strategic Alliances,"
"Technological Changes May Adversely Affect Competitiveness and
Financial Results," "Risks Associated with Rapidly Changing
Industry," "Dependence on Key Personnel," "Risks Associated with
Financing Arrangements; Dividend Restrictions," "Holding Company
Structure; Reliance on Subsidiaries for Dividends,"  "Potential
Volatility of Stock Price," "Risks Associated with Derivative
Financial Instruments," "Currency Risks; Possible Effect on
Financial Condition, Operating Results and Financing Costs;
Exchange Controls," "International Tax Risks" and "Risks of Entry
into Cellular Business and Expansion of Internet, Paging and Data
Transmission Businesses," included under the caption "Company
Risk Factors" in Exhibit 99.1 hereto, which is incorporated by
reference herein, and the Company's periodic reports and other
documents filed with the SEC.

GENERAL

     The Company's revenue is comprised of toll revenue(per
minute charges for long distance services) and local service and
other revenue.  Toll revenue consists of revenue derived from
ACC's long distance and operator-assisted services.  Local
service and other revenue consists of revenue derived from the
provision of local exchange services, including local dial tone,
direct access lines, Internet fees and monthly subscription fees,
and also from data services.  Network costs consist of expenses
associated with the leasing of transmission lines, access charges
and certain variable costs associated with the Company's network.

     The following table shows the total revenue (net of
intercompany revenue) and billable long distance minutes of use
attributable to the Company's North American and European
operations during the three and six month periods ended June 30,
1997 and 1996:

<TABLE>
                             Three Months ended                             Six Months ended
                           June 30, 1997 and 1996                        June 30, 1997 and 1996
                     (dollars and minutes in thousands)           (dollars and minutes in  thousands)
     
                            1997               1996                    1997               1996
<CAPTION>
                     Amount    Percent  Amount    Percent        Amount    Percent   Amount  Percent

Total Revenue:
North America:
     <S>            <C>         <C>    <C>          <C>          <C>         <C>   <C>         <C>
     US             $ 26,441    29.5%  $ 28,980     36.2%        $52,409     30.4% $ 48,735    33.2%
     Canada           29,699    33.2     29,723     37.1          59,390     34.5    57,567    39.2
Total North America   56,140    62.7     58,703     73.3         111,799     64.9   106,302    72.3
Europe:
     UK               33,358    37.3     21,386     26.7          60,351     35.1    40,642    27.7
     Germany               3     -         -         0.0               3      -         -       0.0
Total Europe          33,361    37.3     21,386     26.7          60,354     35.1    40,642    27.7
Total Revenue       $ 89,501   100%    $ 80,089    100%         $172,153    100%   $146,944   100%

Billable Long Distance Minutes of Use:
North America:
     US              173,400   30.9%    136,932     32.0%         343,542   31.8%   275,450   33.0%
     Canada          202,585   36.0     168,435     39.3          389,483   36.0    327,203   39.2
Total North America  375,985   66.9     305,367     71.3          733,025   67.8    602,653   72.1
Europe:
     UK              185,918   33.1     123,032     28.7          348,386   32.2    232,863   27.9
     Germany          -         -        -           0.0           -         -       -         0.0
Total Europe         185,918   33.1     123,032     28.7          348,386   32.2    232,863   27.9
Total Minutes        561,903   100%     428,399     100%        1,081,411   100%    835,516   100%

</TABLE>

     The following table presents certain information concerning
long distance toll revenue (net of intercompany revenue) per
billable minute and network cost per billable minute attributable
to the Company's North American and European operations during
the three and six month periods ended June 30, 1997 and 1996:

                                  Three Months Ended    Six Months Ended
                                       June 30,              June 30,
                                     1997     1996      1997        1996

Toll Revenue Per Billable Long Distance Minute:

North America
     United States                  $0.128   $0.198    $0.128      $0.163
     Canada                          0.125    0.156     0.130       0.155
Total North America                 $0.127   $0.175    $0.129      $0.159
Europe
     United Kingdom                 $0.179   $0.173    $0.173      $0.174
     Germany                           -      -           -           -
Total Europe                        $0.179   $0.173    $0.173      $0.174

Network Cost Per Billable Long Distance Minute:

Total North America                 $0.085   $0.128    $0.087      $0.112
Total Europe                         0.116    0.116     0.111       0.119


     The Company believes that historically its revenue growth as
well as its network costs and results of operations for its U.S.,
Canadian and U.K. operations generally reflect the state of
development of the Company's operations, the Company's customer
mix and the competitive and regulatory environment in those
markets.  The Company entered the U.S, Canadian, and U.K
telecommunications markets in 1982, 1985, and 1993, respectively.
In 1997, the Company established a subsidiary in Germany, and
expects to offer long distance service as a switchless reseller
during the third quarter of 1997. The Company believes that toll
revenue per billable minute and network cost per billable minute
will be lower in future periods, and heavily influenced by
competitive pressures and regulatory actions.

     Deregulatory influences have affected the telecommunications
industry in the U.S. since 1984 and the U.S. market has
experienced considerable competition for a number of years. The
competitive influences on the pricing of ACC services and network
costs have been stabilizing during the past few years.  This may
change in the future as a result of the 1996 Amendment to the
U.S. Communications Act (the "1996 Act") that further opened the
market to competition, particularly from the regional Bell
operating companies ("RBOCs").

     The deregulatory trend in Canada, which commenced in 1989,
has increased competition.  ACC Canada experienced significant
downward pressure on the pricing of its services during 1994 and
1995.  Although revenue per minute increased from 1995 to 1996
due to changes in customer and product mix, revenue per minute
fell during the first half of 1997, and the Company expects such
downward pressure to continue. The impact of this pricing
pressure on revenues of ACC Canada is being offset by an increase
in the Canadian residential and student billable minutes of usage
as a percentage of total Canadian billable minutes of usage, and
introduction of new products and services including 800 service,
local exchange resale, Internet services, and, since February
1997, paging services.

     The Company believes that, because deregulatory influences
have only fairly recently begun to impact the U.K.
telecommunications industry, the Company will continue to
experience a significant increase in revenue from that market,
but the rate of growth is expected to decline.  The foregoing
belief is based upon expectations of actions that may be taken by
U.K. regulatory authorities and the Company's competitors; if
such third parties do not act as expected, the Company's revenues
in the U.K. might not increase.  If ACC U.K. were to experience
increased revenues, the Company believes it should be able to
enhance its economies of scale and scope in the use of the fixed
cost elements of its network.  Nevertheless, the deregulatory
trend in that market is expected to result in competitive pricing
pressure on the Company's U.K. operations which could adversely
affect revenues and margins. Since the U.K. market for
transmission facilities is dominated by British
Telecommunications PLC ("British Telecom") and Mercury
Communications Ltd. ("Mercury"), the downward pressure on prices
for services offered by ACC U.K. may not be accompanied by a
corresponding reduction in ACC UK's network costs in the short
term and, consequently, could adversely affect the Company's
business, results of operations and financial condition,
particularly in the event revenue derived from the Company's U.K.
operations accounts for an increasing percentage of the Company's
total revenue.  Moreover, the Company's U.K. operations are
highly dependent upon the transmission lines leased from British
Telecom. As each of the telecommunications markets in which it
operates continues to mature, the rate of growth in its revenue
and customer base in each such market is likely to decrease over
time. The Company has actively pursued growth opportunities in
the U.K. market.  On May 30, 1997, the Company acquired
Transphone Ltd.. Transphone provides domestic and international
long distance service as a reseller, and is based in London,
U.K..  In acquiring Transphone Ltd., the Company obtained what it
believes is a strong base of commercial customers in a desirable
geographic area.  On July 15, 1997 the Company also acquired
United Telecom Ltd. ("UT").  UT provides domestic and
international long distance services through a pre-paid calling
card platform in retail telephone shops.  UT is based in London,
U.K..  In acquiring UT, the Company obtains what it believes is a
new delivery channel in a growing niche market.  The acquisition
is also expected to create network cost efficiencies, as UT's
customers have peak calling activity at night and on weekends.
This calling pattern will enable the Company to facilitate
routing of off-peak traffic over the Company's switched based
network, thereby adding to economies of scale.  The Transphone
Ltd. and UT acquisitions are expected to be accretive to earnings
commencing in 1998.  The foregoing forward looking statements are
based upon expectations with respect to customer behavior, market
trends and the Company's ability to successfully integrate and
develop the businesses acquired.  If such expectations are not
realized, actual results may differ materially from the foregoing
discussion.

The German telecommunications market is expected to substantially
deregulate in January 1998, as a result of the European Union
("EU") mandate to open telecommunications markets to competition.
Most significantly, the German market is scheduled to be open for
interconnection in January 1998.  The Company has established a
subsidiary in Germany, and signed a resale agreement with
Deutsche Telekom ("DT") on May 20, 1997.  Further, the Company
received a Class 4 full voice telephony license from the German
Ministry of Post and Telecommunications which is effective
January 1, 1998.  This license is a requirement for the Company
to become a switch-based provider of telecommunications services
in Germany.  The Company is in the process of negotiating an
interconnection agreement with DT.  The Company believes it is
positioned to develop a moderate amount of revenue in the third
and fourth quarter of 1997 as a switchless reseller, with
potentially more substantial revenue growth in 1998 if the market
is fully deregulated.  The foregoing forward-looking statement is
based upon expectations with respect to regulatory actions and
cooperation from DT.  If such  expectations are not realized, the
expected revenue growth from the German market may not
materialize.

     Since the commencement of the Company's operations, the
Company has undertaken a program of developing and expanding its
service offerings, geographic focus and network.  In connection
with this development and expansion, the Company has made
significant investments in telecommunications circuits, switches,
equipment and software.  These investments generally are made
significantly in advance of anticipated customer growth and
resulting revenue.  The Company also has increased its sales and
marketing, customer support, network operations and field
services commitments in anticipation of the expansion of its
customer base and geographic markets.  The Company expects to
continue to expand the breadth and scale of its network and
related sales and marketing, customer support and operating
activities.  These expansion efforts are likely to cause the
Company to incur significant increases in expenses from time to
time, in anticipation of potential future growth in the Company's
customer base and geographic markets.

     The Company recently announced the creation of two
continental operating divisions in North America and Europe.  In
conjunction with this new structure, the Company plans to further
expand its European operations as business activity more fully
develops in the deregulating German market and by entering other
telecommunications marketplaces when regulatory and market
conditions warrant.  While the Company has had a successful
history of entering into newly deregulated markets, there can be
no assurances that the same successes will be experienced in the
future.

     The Company has also expanded operations in the U.S. local
exchange business and anticipates that a significant portion of
its future growth will come from this business. The local
exchange business is highly competitive and includes several
larger, better capitalized local service providers, including
AT&T, among others, who can sustain losses associated with
discount pricing, and the high initial investment and expenses
typically incurred to attract local customers.  The Company's
U.S. local service business commenced operations in 1994 and
generated a small operating profit for the first six months of
1997, and for the full year 1996.  However, there can be no
assurances that the Company will continue to achieve positive
cash flow or profitability in this business in the future.

     The Company's operating results have fluctuated in the past
and they may continue to fluctuate significantly in the future as
a result of a variety of factors, some of which are beyond the
Company's control.  The Company expects to focus in the near term
on building and increasing its customer base, service offerings
and targeted geographic markets, which will require it to
increase significantly its expenses for marketing and development
of its network and new services, and may adversely impact
operating results from time to time. Revenues from wholesale
carriers accounted for approximately 20% and 31% of the revenues
of ACC North America and ACC Europe, respectively, in the second
quarter of 1997, and 19% and 26% for the six months ended June
30, 1997. Included in 1996 second quarter and six month revenues
were $9 million of North American non recurring carrier revenues,
or 11% and 8% of consolidated revenues.  With respect to these
customers, the Company competes almost exclusively on price, does
not have long term contracts and generates lower gross margins as
a percentage of revenue. The Company's primary interest in
carrier revenue is to utilize excess capacity on its network.
Carrier revenue for the second quarter of 1997 was 24% of the
Company's consolidated revenue compared to 29% in the second
quarter of 1996, and 21% for the six months ended June 30, 1997
compared to 24% for the six months ended June 30, 1996.
Management believes that carrier revenue will continue to average
20% to 25% of consolidated total revenue as the core businesses
continue to grow.  The foregoing forward-looking statement is
based upon expectations with respect to growth in the Company's
customer base and total revenues.  If such expectations are not
realized, the Company's actual results may differ materially from
the foregoing discussion.

RESULTS OF OPERATIONS

     The following table presents, for the quarters ended June
30, 1997 and 1996, and the six months ended June 30, 1997 and
1996, certain Statement of Operations data expressed as a
percentage of total revenue:
                    
                
                              
<TABLE>
                              
                            
                                       Three Months ended          Six Months ended
                                      June 30, 1997 and 1996    June 30, 1997 and 1996
                                        1997          1996          1997          1996
<CAPTION>
Revenue:
  <S>                                   <C>             <C>         <C>           <C>
  Toll revenue                          90.3%           93.1%       89.8%         92.6%
  Local service and other                9.7             6.9        10.2           7.4
  Total revenue                        100.0           100.0       100.0         100.0
Network costs                           59.8            66.7        59.3          64.6
Gross profit                            40.2           33.3         40.7          35.4
Other operating expenses:
  Depreciation and amortization          6.0            5.2          6.1           5.3
  Selling, general and administrative   27.6           24.2         28.1          25.9
  Total other operating expenses        33.6           29.4         34.2          31.2
Income  from operations                  6.6            3.9          6.5           4.2
Total other income (expenses)          < 0.8>          <1.1>        <0.9>         <1.6>
Income from operations before provision
  for income taxes and minority
  interest                               5.7            2.8          5.6           2.6
Provision for income taxes               0.9            0.7          0.8           0.6
Minority interest in (income)
  loss of consolidated subsidiary           -          <.4>           -            <.4>
  Income (loss) from operations          4.9%          1.7%          4.8%          1.6%

</TABLE>
QUARTER ENDED JUNE 30, 1997 COMPARED WITH QUARTER ENDED JUNE 30,
1996

REVENUE.  Total revenue for the quarter ended June 30, 1997
increased $9.4 million, or 12%, to $89.5 million from $80.1
million for the same period in 1996.  Long distance toll revenue
increased $6.2 million, or 8%, to
$80.8 million from $74.6 million, and local service and other
revenue increased $3.2 million, or 58%, to $8.7 million from $5.5
million.  The growth in long distance toll revenues was fueled by
a 31% increase in billable minutes and 27% growth in number of
customer accounts.  Revenue from wholesale carriers during the current
quarter declined to $21.5 million (24% of total revenues) from $23.5
million (29% of total revenues)for the same period in 1996.
Significantly reduced revenues from two carriers were realized in
the current quarter, accounting for a $3.8 million reduction in
carrier revenues from the same quarter in 1996.  Additionally,
the 1996 quarter reflects $9 million of non recurring carrier
revenues.  Excluding wholesale carrier revenues, long distance toll
revenue for the current quarter increased 16% from the same period in
1996.  Long distance toll revenue per billable minute for the current
quarter decreased 17%, from $.174 to $.144, largely a result of competitive
pricing pressures and lower revenue from carriers.  The growth in other
revenues is largely attributable to growth in market share in the
competitive local exchange business in the U.S. and a full quarter of
revenues in 1997 from Internet revenues in Canada compared to one
month in 1996.

Total revenue (unaffiliated) in North America for the current
quarter decreased 4% from the same period in 1996. Long distance
toll revenue (unaffiliated) decreased 11% from 1996, as the 1996
quarter included $9 million of non recurring carrier revenue.
Excluding carrier revenues, long distance toll revenue for the
current quarter increased 11% from the same period in 1996, and
is attributable to growth in minutes and customer accounts. Long
distance toll revenue per minute for the current quarter
decreased 27% from $.175 to $.127, a result of competitive
pricing pressures in both the U.S. and Canada and lower revenue
from carriers.  Local service and other revenues for the current
quarter increased 58% over the same period in 1996, a result of
growth in U.S. local exchange revenues and increased Internet related
revenues in Canada.   The Company continues to invest in the
local exchange business, having recently installed switches in
Buffalo and Albany, and has planned installations for additional
switches in New York City, Boston and Springfield Massachusetts.
Continued expansion and growth in local exchange service, Internet
and other services is expected to become a larger component of
total revenues in future periods.

Total revenue (unaffiliated) in Europe (substantially all long
distance toll revenue) for the current quarter increased 56% from
the same period in 1996.  Excluding carrier revenues, long
distance toll revenue for the current period increased 25% from
the same period in 1996, and is attributable to growth in minutes
and customers accounts.  Long distance toll revenue per billable
minute for the current quarter increased 3% from $.173 to $.179 as
the impact of higher revenues from carriers offset retail price
reductions implemented during the quarter for international and
domestic long distance rates.  No material revenues from the German
operating unit were generated during the current quarter.

NETWORK COST.  Network cost for the quarter ended June 30, 1997
increased $.1 million, or 0%, to $53.5 million from $53.4 million
for the same period in 1996.  As a percent of revenue, network
cost for the current quarter was 60% compared to 67% for the same
period in 1996.  Network cost per billable minute for the current
quarter decreased 24%, from $.125 to $.095.  The reduction of
current quarter network cost as a percent of revenue, and per
minute, is largely attributable to 1) reduced contribution
charges enacted during the quarter in Canada, 2) a favorable
shift in business/customer mix, as higher margin local exchange
revenues constitute a higher percent of revenues in 1997 as
compared to 1996, and lower margin wholesale carrier revenues
constitute a lower percentage of 1997 revenues as compared to
1996, and 3) internal network efficiencies.

Network cost in North America for the current quarter as a
percent of unaffiliated revenue decreased to 57% from 67% for the
same period in 1996, and per billable minute also decreased from
$.128 to $.085.  These improvements resulted from the aforementioned
reduction in Canadian contribution charges, increased amount of higher
margin local exchange revenue in the U.S., and internal network
efficiencies.  Network cost in Europe for the current quarter as
a percent of unaffiliated revenue decreased to 65% from 67% for
the same period in 1996, and per billable minute was essentially
unchanged at $.116.  Recent investments in switches, a microwave
network and IRU are expected to more significantly lower network
costs in the near term, as ownership of these facilities will
enable the company to reduce reliance on leased lines and
increase network capacity.  This forward looking statement is
based on expectations regarding customer demand and the relative
cost and availability of leased lines and alternative
transmission facilities in the Company's markets, and could be
adversely impacted by competitive pricing pressures.  If such
expectations are not realized, the Company's actual results may
differ materially from the foregoing discussion.

OTHER OPERATION EXPENSES - DEPRECIATION AND AMORTIZATION.  Total
depreciation expense for the quarter ended June 30, 1997
increased $1.2 million, or 28%, from $4.2 million for the same
period in 1996, largely attributable to recent switch
installations in Albany and Buffalo, and other capital
expenditures, as well as higher amortization of the customer base
and goodwill associated with the Internet Canada acquisition in
1996.

OTHER OPERATION EXPENSES - SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES.  Total Selling, General and Administrative expenses
("SG&A") for the quarter ended June 30, 1997 increased $5.4
million, or 28%, to $24.8 million from $19.4 million for the same
period in 1996.  As a percent of revenue, SG&A increased 4% to
28% from 24%.  Selling expenses, (i.e., agent, salesperson and
other commissions), increased $1.8 million in connection with higher
revenues ($.6 million increase in selling expenses related to growth
in local exchange revenues).  Operating costs incurred in connection
with the Company's German subsidiary contributed $.4 million of costs.
Payroll and all other operating costs increased $3.2 million and this
increase was primarily attributable to  infrastructure costs to support
expansion and growth in the Company's business lines.

OTHER INCOME/EXPENSES.  Net interest expense for the quarter
ended June 30, 1997 decreased $.2 million, or 24%, from $.9
million to $.7 million.  Foreign exchange gains/losses reflect
changes in the value of amounts borrowed by the foreign
subsidiaries from ACC Corp. and ACC US.  The Company continues
to hedge substantially all intercompany loans to foreign
subsidiaries in an attempt to reduce the impact of transaction
gains or losses.  The Company does not engage in speculative
foreign currency transactions.  During the quarter ended June 30,
1997 the Company recognized losses on foreign currency
transactions of $36,000 compared to a $14,000 gain in the same
period of 1996.

PROVISION FOR TAXES.  Provision for taxes for the quarter ended
June 30, 1997 increased $.2 million, or 47%, from $.5 million to
$.7 million.  Stated as a percent of pre tax income, the
effective tax rate for the current quarter was 15% as compared to
27% for the same period in 1996.  Income taxes are provided on
all revenues in excess of available net operating loss
carryforwards ("NOL's") at the statutory rate applicable for each
country.  The Company continues to utilize NOL's to offset
taxable income generated in Canada and the U.K..  The increase in
operating earnings in both of these subsidiaries, which is not
subject to tax due to utilization of NOL's, reduces the effective
tax rate for the consolidated Company.

MINORITY INTEREST IN (EARNINGS) OF CONSOLIDATED SUBSIDIARY.
Minority interest for the quarter ended June 30, 1996 reflects
the portion of the Company's Canadian subsidiary's income
attributable to the approximately 30% of that subsidiary's common
stock that was publicly traded in Canada.  Prior to December 31,
1996, the Company repurchased approximately 24% of the
outstanding shares, and the remaining 6% was repurchased in
January 1997.  As a result, the Canadian subsidiary is currently
100% owned, with no remaining minority interest.

The Company's income from operations for the quarter ended June
30, 1997 was $5.9 million compared to $3.2 million for the same
period in 1996, and was comprised of the following:  North
America operations $3.5 million as compared to $3.2 million, and
European operations, $2.4 million as compared to $.0 million.

SIX MONTHS ENDED JUNE 30, 1997 COMPARED WITH SIX MONTHS ENDED
JUNE 30, 1996

REVENUE.  Total revenue for the six months ended June 30, 1997
increased $25.2 million, or 17%, to $172.2 million. from $146.9
million for the same period in 1996.  Long distance toll revenue
increased $18.5 million, or 14%, to $154.7 million from $136.1
million, and local service and other revenue increased $6.7
million, or 62%, to $17.5 million from $10.8 million.  The growth
in long distance toll revenues was fueled by a 29% increase in
billable minutes and 27% growth in number of customer accounts.
Revenue from wholesale carriers during the current period
increased to $36.7 million (21% of total revenues) from $35.1
million (24% of total revenues)for the same period in 1996.
Significantly reduced revenues from two carriers were realized in
the current period, accounting for a $6.3 million reduction in
carrier revenues from the same period in 1996.  Additionally, the
1996 period reflects $9 million of non recurring carrier revenues.
Excluding wholesale carrier revenues, long distance toll revenue
for the current period increased 17% from the same period in
1996.  Long distance toll revenue per billable minute for the
current period decreased 12%, from $.163 to $.143, largely a
result of competitive pricing pressures.  The growth in other
revenues is largely attributable to growth in market share in the
competitive local exchange business in the U.S. and a full six
months of revenues in 1997 from Internet revenues in Canada
compared to one month in 1996.

Total revenue (unaffiliated) in North America for the current
period increased 5% from the same period in 1996. Long distance
toll revenue (unaffiliated) decreased 1% from 1996, as the 1996
period included $9 million of non recurring carrier revenue.
Excluding carrier revenues, long distance toll revenue for the
current period increased 12% from the same period in 1996, and is
attributable to growth in minutes and customer accounts. Long
distance toll revenue per minute for the current period decreased
19% from $.159 to $.129, a result of competitive pricing
pressures in both the U.S. and Canada and lower revenue from
carriers.  Local service and other revenues for the current
period increased 62% over the same period in 1996, a result of
growth in U.S. local exchange revenues and increased Internet
related revenues in Canada.   The Company continues to invest in
the local exchange business, having recently installed switches
in Buffalo and Albany, and has planned installations for
additional switches in New York City, Boston and Springfield
Massachusetts. Continued expansion and growth in local exchange
service, Internet and other services is expected to become a
larger component of total revenues in future periods.

Total revenue (unaffiliated) in Europe (substantially all long
distance toll revenue) for the current period increased 49% from
the same period in 1996.  Excluding carrier revenues, long
distance toll revenue for the current period increased 26% from
the same period in 1996, and is attributable to growth in minutes
and customer accounts. Long distance toll revenue per billable
minute for the current period decreased 1% from $.174 to $.173 as
the impact of higher revenues from carriers partially offset
retail price reductions implemented during the period for
international and domestic long distance rates.  No material
revenues from the German operating unit were generated during the
current period.

NETWORK COST.  Network cost for the six months ended June 30, 1997
increased $7.1 million, or 8%, to $102.1 million from $95.0
million for the same period in 1996.  As a percent of revenue,
network cost for the current period was 59% compared to 65% for
the same period in 1996.  Network cost per billable minute for
the current period decreased 17%, from $.114 to $.094.  The
reduction of current period network cost as a percent of revenue,
and per minute, is largely attributable to 1) reduced
contribution charges enacted during the period in Canada, 2) a
favorable shift in business/customer mix, as higher margin local
exchange revenues constitute a higher percent of revenues in 1997
as compared to 1996, and lower margin wholesale carrier revenues
constitute a lower percentage of 1997 revenues as compared to
1996, and 3) internal network efficiencies.

Network cost in North America for the current period as a percent
of unaffiliated revenue decreased to 57% from 63% for the same
period in 1996, and per billable minute also decreased from $.112
to $.087.  These improvements resulted from the aforementioned
reduction in Canadian contribution charges, increased amount of
higher margin local exchange revenue in the U.S., and internal
network efficiencies.  Network cost in Europe for the current
period as a percent of unaffiliated revenue decreased to 63% from
68% for the same period in 1996, and per billable minute decreased
from $.119 to $.111.  Recent investments in switches, a
microwave network and IRU are expected to more significantly
lower network costs in the near term, as ownership of these
facilities will enable the Company to reduce reliance on leased
lines and increase network capacity.  This forward looking
statement is based on expectations regarding customer demand and
the relative cost and availability of leased lines and
alternative transmission facilities in the Company's markets, and
could be adversely impacted by competitive pricing pressures.  If
such expectations are not realized, the Company's
actual results may differ materially from the foregoing
discussion.

OTHER OPERATION EXPENSES - DEPRECIATION AND AMORTIZATION.  Total
depreciation expense for the six months ended June 30, 1997
increased $2.7 million, or 34%, from  $7.8 million for the same
period in 1996, largely attributable to recent switch
installations in Albany and Buffalo, and other capital
expenditures, as well as higher amortization of the customer
base and goodwill associated with the Internet Canada acquisition
in 1996.

OTHER OPERATING EXPENSES - SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES.  Total Selling, General and Administrative expenses
("SG&A") for the six months ended June 30, 1997 increased $10.3
million, or 27%, to $48.3 million from $38.0 million for the same
period in 1996.  As a percent of revenue, SG&A increased 2% to
28% from 26%.  Selling expenses, (i.e., agent, salesperson and
other commissions), increased $3.6 million in connection with
higher revenues ($1.1 million increase in selling expenses related
to growth in U.S. local exchange revenues).  Operating costs
incurred in connection with the Company's German subsidiary
contributed $.7 million of costs.  Payroll and all other operating
costs increased $6.0 million and this increase was primarily
attributable to infrastructure costs to support expansion and
growth in the Company's business lines.

OTHER INCOME/EXPENSES.  Net interest expense for the six months
ended June 30, 1997 decreased $1.1 million, or 45%, from $2.4
million to $1.3 million.  Foreign exchange gains/losses reflect
changes in the value of amounts borrowed by the foreign subsidiaries
from ACC Corp. and ACC U.S. The Company continues to hedge substantially
all intercompany loans to foreign subsidiaries in an attempt to
reduce the impact of transaction gains or losses.  The Company does
not engage in speculative foreign currency transactions.  During the
six months ended June 30, 1997 the Company recognized losses on foreign
currency transactions of $188,000 compared to a $26,000 gain in the same
period of 1996.

PROVISION FOR TAXES.  Provision for taxes for the six months ended
June 30, 1997 increased $.4 million, or 52%, from $.9 million to
$1.3 million. Stated as a percent of pre tax income, the
effective tax rate for the current period was 13% as compared to
23% for the same period in 1996.  Income taxes are provided on
all revenues in excess of available net operating loss
carryforwards ("NOL's") at the statutory rate applicable for each
country. The Company continues to utilize NOL's to offset taxable
income generated in Canada and the U.K..  The increase in
operating earnings in both of these subsidiaries, which is not
subject to tax due to utilization of NOL's, reduces the effective
tax rate for the consolidated Company.

MINORITY INTEREST IN (EARNINGS) OF CONSOLIDATED SUBSIDIARY.
Minority interest for the six months ended June 30, 1996 reflects
the portion of the Company's Canadian subsidiary's income
attributable to the approximately 30% of that subsidiary's common
stock that was publicly traded in Canada.  Prior to December 31,
1996, the Company repurchased approximately 24% of the
outstanding shares, and the remaining 6% was repurchased in
January 1997.  As a result, the Canadian subsidiary is currently
100% owned, with no remaining minority interest.

The Company's income from operations for the six months ended
June 30, 1997 was $11.2 million compared to $6.2 million for the
same period in 1996, and was comprised of the following:  North
America operations $7.1 million as compared to $6.4 million, and
European operations $4.2 million as compared to ($.2) million.

 
LIQUIDITY AND CAPITAL RESOURCES

     In May 1996, the Company raised net proceeds of $63.1
million through an offering of Common Stock.  The proceeds from
this offering were used to repay indebtedness under the Credit
Facility, for working capital needs, and capital expenditures.
The Company also expended $32.1 million in 1996 to repurchase the
minority interest in ACC Canada.  Historically, the Company has
satisfied its working capital requirements through cash flow from
operations, through borrowings and financings from financial
institutions, vendors and other third parties, and through the
issuance of securities.  The Company also received net proceeds
of approximately $1.9 million from the exercise of options and
warrants by selling shareholders in the October 1996 secondary
Common Stock offering and an additional $4.9 million from the
exercise of employee stock options at various times during the
year.

     In January 1997, the Company entered into an amended and
restated $100 million credit facility, subject to availability
under a borrowing base formula and certain other conditions
(including borrowing limits based on the Company's operating cash
flow).  As of June 30, 1997, the unused amount under the Credit
Facility was approximately $65 million.

     Net cash flows used in operations for the six months ended
June 30, 1997 were $9.2 million compared to $.5 million for the
same period in 1996.  The increase of $8.7 million primarily
resulted from $18.2 million of higher payments of previously
accrued expenses associated with the Canadian minority interest
repurchase and accrued year-end bonuses, and expenditures for
other non-current assets (including an IRU for $5.2 million),
partially offset by higher net income of $6.1 million and
depreciation of $2.7 million, and smaller increase in accounts
receivable of $6.7 million.

     Net cash flows used in investing activities (for capital
expenditures, acquisition of customer base and acquisition of
Transphone Ltd.) for the six months ended June 30, 1997 were
$19.9 million compared with $11.8 million for the same period in
1996.

     Net cash provided by financing activities for the six months
ended June 30, 1997 was $26.6 million compared with $42.4 million
for the same period of 1996.  The decrease reflects the Credit
Facility to fund working capital needs, capital expenditures and
refinancing of existing debt.

     The Company's principal need for working capital is to fund
network costs and to meet its selling, general and administrative
expenses as its business expands.  In addition, the Company's
capital resources have been used for acquisitions (i.e.,
Metrowide Communications, Internet Canada and Transphone Ltd.),
capital expenditures, various customer base acquisitions, and the
repurchase of the minority interest in ACC Canada.  The Company
has historically reflected working capital deficits at the end of
the last several years but, at June 30, 1997, reflected a working
capital surplus of approximately $6.1 million compared to a
deficit of approximately $15.5 million at December 31, 1996, due
primarily to utilization of the Credit Facility to satisfy
current liabilities.

     The Company anticipates that, throughout the remainder of
1997, its capital expenditures will be approximately $47 million
for the expansion of its network, the acquisition, upgrading and
development of switches and other telecommunications equipment as
conditions warrant, the development, licensing and integration of
its management information system and other software, the
development and expansion of its service offerings and customer
programs and other capital expenditures.  Approximately $17.5
million in capital expenditures were recorded during the six
months ended June 30, 1997.  ACC expects that it will continue to
make significant capital expenditures during future periods,
particularly for switching equipment for the U.K. and for local
exchange switches in U.S markets, and related costs.  The
Company's actual capital expenditures and cash requirements will
depend on numerous factors, including the nature of future
expansion (including the extent of local exchange services, which
is particularly capital intensive), and acquisition
opportunities, economic conditions, competition, regulatory
developments, the availability of capital and the ability to
incur debt and make capital expenditures under the terms of the
Company's financing arrangements.  The Company has also formed a
German subsidiary in anticipation of deregulation in that
marketplace, and anticipates that the initial capital
expenditures related to this operation will approximate $2.5
million during 1997.

     As of June 30, 1997, the Company had approximately $-0- of
cash and cash equivalents and maintained the $100 million Credit
Facility, subject to availability under a borrowing base formula
and certain other conditions (including borrowing limits based
the Company's operating cash flow), under which $32 million was
outstanding. The maximum aggregate principal amount of the Credit
Facility is required to be reduced by $8 million per quarter
commencing on March 31, 1999 until December 31, 2000, and by $9
million per quarter commencing on March 31, 2001 until maturity
of the loan in January 2002.

     In addition, as of June 30, 1997, the Company had $4.3
million of capital lease obligations which mature at various
times from 1997 through 2000.  During the six months ended June
30, 1997,  the Company prepaid a $4.0 million capitalized lease
obligation using funds from the Credit Facility.  The Company's
financing arrangements, which are secured by substantially all of
the Company's assets including stock of certain subsidiaries,
require the Company to maintain certain financial ratios.

     In the normal course of business, the Company uses various
financial instruments, including derivative financial
instruments, for purposes other than trading.  These instruments
include letters of credit, guarantees of debt, interest rate swap
agreements and foreign currency exchange contracts relating to
U.S. dollar payables of foreign subsidiaries.  The Company does
not use derivative financial instruments for speculative
purposes.  Foreign currency exchange contracts are used to
mitigate foreign currency exposure and are intended to protect
the U.S. dollar value of certain currency positions and future
foreign currency transactions.  The aggregate fair value, based
on published market exchange rates, of the Company's foreign
currency contracts at June 30, 1997 was $76.9 million.  From time
to time, the Company uses interest rate swap agreements to reduce
its exposure to risks associated with interest rate fluctuations.
As is customary for these types of instruments, collateral is
generally not required to support these financial instruments.

     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.  However, at June 30, 1997, in
management's opinion there was no significant risk of loss due to
nonperformance of the counterparties to these financial
instruments.  The Company controls its exposure to counterparty
credit risk through monitoring procedures and by entering into
multiple contracts.  Based upon the Company's knowledge of the
financial position of the counterparties to its existing
derivative instruments, the Company believes that it does not
have any significant exposure to any individual counterparty or
any major concentration of credit risk related to any such
financial instruments.

     The Company believes that, under its present business plan,
the borrowing availability under the existing Credit Facility,
and cash from operations will be sufficient to meet anticipated
working capital and capital expenditure requirements of its
existing operations for the foreseeable future.  The forward-
looking information contained in the previous sentence may be
affected by a number of factors, including the matters described
in this paragraph and in Exhibit 99.1 attached hereto. The
Company may need to raise additional capital from public or
private equity or debt sources in order to finance its
operations, capital expenditures and growth for future periods.
In addition, the Company may have to refinance a substantial
amount of indebtedness and obtain additional funds prior to 2002,
when the Credit Facility matures.  Moreover, the Company believes
that continued growth and expansion through acquisitions,
investments and strategic alliances is important to maintain a
competitive position in the market and, consequently, a principal
element of the Company's business strategy is to develop
relationships with strategic partners and to acquire assets or
make investments in businesses that are complementary to its
current operations.  The Company may need to raise additional
funds in order to take advantage of opportunities for
acquisitions, investments and strategic alliances or more rapid
international expansion, to develop new products or to respond to
competitive pressures.  There can be no assurance that the
Company will be able to raise such capital on acceptable terms or
at all. The Company's ability to obtain additional sources of
capital will depend upon, among other things, its financial
condition at the time, the restrictions and the instruments
governing its indebtedness and other factors, including market
conditions, beyond the control of the Company.  Additional
sources of capital may include public and private equity and debt
financings, sale of assets, capitalized leases and other
financing arrangements.  In the event that the Company is unable
to obtain additional capital or is unable to obtain additional
capital on acceptable terms, the Company may be required to
reduce the scope of its presently anticipated expansion
opportunities and capital expenditures, which could have a
material adverse effect on its business, results of operations
and financial condition and could adversely impact its ability to
compete.

     The Company may seek to develop relationships with strategic
partners both domestically and internationally and to acquire
assets or make investments in businesses that are complementary
to its current operations.  Such acquisitions, strategic
alliances, or investments may require that the Company obtain
additional financing and, in some cases, the approval of the
Company's creditors.  The Company's ability to effect
acquisitions, strategic alliances, or investments may be
dependent upon its ability to obtain such financing and, to the
extent applicable, consents from creditors.


PART II. OTHER INFORMATION


Item 6.   Exhibits and Reports on Form 8-K.

     (a)  Exhibits.  See Exhibit Index.


SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused the Report to be signed
on its behalf by the Undersigned thereunto duly authorized.

                                        ACC CORP.
                                        (Registrant)


Dated:  August 14, 1997                 /s/ Michael R. Daley
                                        Michael R. Daley
                                        Executive Vice President
                                        and Chief Financial
                                        Officer


Dated:  August 14, 1997                 /s/ Frank C. Szabo
                                        Frank C. Szabo
                                        Vice President and
                                        Controller

EXHIBIT INDEX

Exhibit Number      Description                   Location

11.1           Statement re Computation of   See note 3 to the
               Per Share Earnings            notes to
                                             Consolidated
                                             Financial
                                             Statements filed
                                             herewith

27.1           Financial Data Schedule       Filed herewith

99.1           Company Risk Factors          Filed herewith
             

