UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended  September 30, 2007

OR

o 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	Registrant; State of Incorporation; Address and Telephone Number	IRS Employer Identification No.
1-14764	Cablevision Systems Corporation	11-3415180
	Delaware
	1111 Stewart Avenue
	Bethpage, New York 11714
	(516) 803-2300
1-9046	CSC Holdings, Inc.	11-2776686
	Delaware
	1111 Stewart Avenue
	Bethpage, New York 11714
	(516) 803-2300

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

Cablevision Systems Corporation	Yes	x	No	o
CSC Holdings, Inc.	Yes	x	No	o

Indicate by check mark whether each Registrant is a large accelerated filer, accelerated filer or non-accelerated filer (as defined in Exchange Act Rule 12b-2).

Large accelerated filer

Accelerated filer

Non-accelerated filer

Cablevision Systems Corporation

Yes

x

No

o

Yes

o

No

o

Yes

o

No

o

CSC Holdings, Inc.

Yes

o

No

o

Yes

o

No

o

Yes

x

No

o

Indicate by check mark whether the Registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act).

Cablevision Systems Corporation	Yes	o	No	x
CSC Holdings, Inc.	Yes	o	No	x

Number of shares of common stock outstanding as of November 2, 2007:

Cablevision NY Group Class A Common Stock   -	230,886,568
Cablevision NY Group Class B Common Stock   -	63,265,676
CSC Holdings, Inc. Common Stock   -	11,595,635

CSC Holdings, Inc. meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format applicable to CSC Holdings, Inc.

CABLEVISION SYSTEMS CORPORATION AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS

			Page
PART I. FINANCIAL INFORMATION
	Item 1.	Financial Statements of Cablevision Systems Corporation and Subsidiaries
		Condensed Consolidated Balance Sheets - September 30, 2007 (unaudited) and December 31, 2006	3
		Condensed Consolidated Statements of Operations - Three and Nine Months Ended September 30, 2007 and 2006 (unaudited)	5
		Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2007 and 2006 (unaudited)	6
		Notes to Condensed Consolidated Financial Statements (unaudited)	7
		Financial Statements of CSC Holdings, Inc. and Subsidiaries
		Condensed Consolidated Balance Sheets - September 30, 2007 (unaudited) and December 31, 2006	28
		Condensed Consolidated Statements of Operations - Three and Nine Months Ended September 30, 2007 and 2006 (unaudited)	30
		Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2007 and 2006 (unaudited)	31
		Notes to Condensed Consolidated Financial Statements (unaudited)	32
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	53
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	82
	Item 4.	Controls and Procedures	85
PART II. OTHER INFORMATION
	Item 1.	Legal Proceedings	85
	Item 1A.	Risk Factors	85
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	86
	Item 4.	Submission of Matters to a Vote of Security Holders	87
	Item 6.	Exhibits	88
	SIGNATURES		89

PART I. FINANCIAL INFORMATION

This Quarterly Report on Form 10-Q for the period ended September 30, 2007 is separately filed by Cablevision Systems Corporation (“Cablevision”) and CSC Holdings, Inc. (“CSC Holdings” and collectively with Cablevision and their subsidiaries, the “Company” or “we”, “us” or “our”).

This Quarterly Report contains statements that constitute forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995, including disclosures relating to restructuring charges, availability under credit facilities, capital market conditions, levels of capital expenditures, sources of funds, funding requirements, and expected changes in basic video customers and revenue generating units growth, among others. Investors are cautioned that such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties and that actual results or developments may differ materially from the forward-looking statements as a result of various factors. Factors that may cause such differences to occur include, but are not limited to:

•the level of our revenues;

•competition from existing competitors (such as direct broadcast satellite (“DBS”) providers and telephone companies) and new competitors (such as high-speed wireless providers) entering our franchise areas;

•demand for our basic video, digital video, high-speed data and voice services, which are impacted by competition from other services and the other factors discussed herein;

•the cost of programming and industry conditions;

•the regulatory environment in which we operate;

•developments in the government investigations and litigation related to past practices of the Company in connection with grants of stock options and stock appreciation rights (“SARs”);

•developments in the government investigations relating to improper expense recognition and the timing of recognition of launch support, marketing and other payments under affiliation agreements;

•the outcome of litigation and other proceedings, including the matters described under “Legal Matters” in the notes to our condensed consolidated financial statements;

•general economic conditions in the areas in which we operate;

•demand for advertising inventory;

•our ability to obtain or produce content for our programming businesses;

•the level of our capital expenditures;

•the level of our expenses;

•future acquisitions and dispositions of assets;

•the demand for our programming among cable television system and DBS operators and telephone companies and our ability to maintain and renew affiliation agreements with cable television system and DBS operators and telephone companies;

•market demand for new services;

•whether pending uncompleted transactions, if any, are completed on the terms and at the times set forth (if at all);

•other risks and uncertainties inherent in the cable television business, the programming and entertainment businesses and our other businesses;

1

•financial community and rating agency perceptions of our business, operations, financial condition and the industry in which we operate; and

•the factors described in our filings with the Securities and Exchange Commission, including under the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained therein.

We disclaim any obligation to update or revise the forward-looking statements contained herein, except as otherwise required by applicable federal securities laws.

2

Item 1.                    Financial Statements

CABLEVISION SYSTEMS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share amounts)

	September 30,		December 31,
	2007		2006
	(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	808,247	$	524,401
Restricted cash	62,312		11,390
Accounts receivable, trade (less allowance for doubtful accounts of $14,475 and $17,257)	503,123		516,533
Prepaid expenses and other current assets	224,191		157,003
Feature film inventory, net	125,065		124,778
Deferred tax asset	339,657		184,032
Investment securities pledged as collateral	195,130		18,981
Derivative contracts	771		81,140
Assets held for sale	—		49,189
Total current assets	2,258,496		1,667,447
Property, plant and equipment, net of accumulated depreciation of $6,885,510 and $6,254,510	3,483,713		3,713,030
Investments in affiliates	—		49,950
Notes and other receivables	41,421		29,659
Investment securities pledged as collateral	851,718		1,080,229
Other assets	88,908		80,273
Feature film inventory, net	400,226		375,700
Deferred carriage fees, net	157,539		173,059
Cable television franchises	731,848		731,848
Affiliation, broadcast and other agreements, net of accumulated amortization of $433,985 and $390,324	354,021		397,682
Other intangible assets, net of accumulated amortization of $96,065 and $77,255	309,595		325,291
Excess costs over fair value of net assets acquired	1,023,860		1,024,168
Deferred financing and other costs, net of accumulated amortization of $82,978 and $68,705	105,176		117,409
Assets held for sale	—		79,112
	$	9,806,521	$	9,844,857

See accompanying notes to

condensed consolidated financial statements.

3

	September 30,			December 31,
	2007			2006
	(unaudited)
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY
Current Liabilities:
Accounts payable	$	396,664		$	389,400
Accrued liabilities	825,637			1,023,488
Deferred revenue	235,001			162,463
Feature film and other contract obligations	116,616			121,890
Liabilities under derivative contracts	10,423			6,568
Bank debt	125,000			93,750
Collateralized indebtedness	172,822			102,268
Capital lease obligations	5,761			7,069
Notes payable	1,017			17,826
Senior notes and debentures	999,991			499,952
Liabilities held for sale	—			6,024
Total current liabilities	2,888,932			2,430,698
Feature film and other contract obligations	307,186			312,344
Deferred revenue	13,835			14,337
Deferred tax liability	400,215			73,724
Liabilities under derivative contracts	165,617			204,887
Other liabilities	317,435			333,954
Bank debt	4,806,250			4,898,750
Collateralized indebtedness	667,274			819,306
Senior notes and debentures	4,994,862			5,494,004
Senior subordinated notes and debentures	323,247			497,011
Notes payable	—			1,017
Capital lease obligations	52,501			54,389
Minority interests	784			49,670
Liabilities held for sale	—			19
Total liabilities	14,938,138			15,184,110
Commitments and contingencies
Stockholders’ Deficiency:
Preferred Stock, $.01 par value, 50,000,000 shares authorized, none issued	—			—
CNYG Class A Common Stock, $.01 par value, 800,000,000 shares authorized, 255,491,250 and 250,927,804 shares issued and 230,895,990 and 228,643,568 shares outstanding	2,555			2,509
CNYG Class B Common Stock, $.01 par value, 320,000,000 shares authorized, 63,266,676 and 63,736,814 shares issued and outstanding	633			637
RMG Class A Common Stock, $.01 par value, 600,000,000 shares authorized, none issued	—			—
RMG Class B Common Stock, $.01 par value, 160,000,000 shares authorized, none issued	—			—
Paid-in capital	119,365			57,083
Accumulated deficit	(4,813,179		)	(5,027,473		)
	(4,690,626		)	(4,967,244		)
Treasury stock, at cost (24,595,260 and 22,284,236 shares)	(429,037		)	(360,059		)
Accumulated other comprehensive loss	(11,954		)	(11,950		)
Total stockholders’ deficiency	(5,131,617		)	(5,339,253		)
	$	9,806,521		$	9,844,857

See accompanying notes to

condensed consolidated financial statements.

4

CABLEVISION SYSTEMS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three and Nine Months Ended September 30, 2007 and 2006

 (Dollars in thousands, except per share amounts)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Revenues, net	$	1,511,799		$	1,381,716		$	4,642,416		$	4,166,173
Operating expenses:
Technical and operating (excluding depreciation, amortization and impairments shown below)	637,807			624,820			2,053,732			1,869,002
Selling, general and administrative	390,618			346,446			1,161,850			1,074,732
Restructuring charges (credits)	1,107			(1,729		)	2,562			(4,483		)
Depreciation and amortization (including impairments)	280,199			285,207			843,497			840,782
	1,309,731			1,254,744			4,061,641			3,780,033
Operating income	202,068			126,972			580,775			386,140
Other income (expense):
Interest expense	(237,487		)	(243,390		)	(714,337		)	(686,100		)
Interest income	13,353			4,581			28,317			27,118
Equity in net income of affiliates	—			2,677			4,377			5,872
Gain (loss) on sale of affiliate interests	(618		)	—			183,270			—
Gain (loss) on investments, net	(46,136		)	100,922			(31,505		)	179,113
Gain (loss) on derivative contracts, net	1,185			(130,019		)	37,087			(172,634		)
Write-off of deferred financing costs	(2,919		)	(6,084		)	(2,919		)	(14,083		)
Loss on extinguishment of debt	(19,113		)	—			(19,113		)	(13,125		)
Minority interests	(401		)	381			814			1,279
Miscellaneous, net	457			2,256			1,908			2,283
	(291,679)			(268,676		)	(512,101		)	(670,277		)
Income (loss) from continuing operations before income taxes	(89,611		)	(141,704		)	68,674			(284,137		)
Income tax benefit (expense)	10,715			79,969			(53,586		)	137,591
Income (loss) from continuing operations	(78,896		)	(61,735		)	15,088			(146,546		)
Income (loss) from discontinued operations, including gain on sale of Fox Sports Net Bay Area of $187,784, net of taxes	(440		)	2,578			197,175			44,867
Income (loss) before cumulative effect of a change in accounting principle	(79,336		)	(59,157		)	212,263			(101,679		)
Cumulative effect of a change in accounting principle, net of taxes	—			—			(443		)	(862		)
Net income (loss)	$	(79,336	)	$	(59,157	)	$	211,820		$	(102,541	)
Basic net income (loss) per share:
Income (loss) from continuing operations	$	(0.27	)	$	(0.22	)	$	0.05		$	(0.52	)
Income (loss) from discontinued operations	$	—		$	0.01		$	0.69		$	0.16
Cumulative effect of a change in accounting principle	$	—		$	—		$	—		$	—
Net income (loss)	$	(0.27	)	$	(0.21	)	$	0.74		$	(0.36	)
Basic weighted average common shares (in thousands)	289,845			283,901			287,719			283,484
Diluted net income (loss) per share:
Income (loss) from continuing operations	$	(0.27	)	$	(0.22	)	$	0.05		$	(0.52	)
Income (loss) from discontinued operations	$	—		$	0.01		$	0.67		$	0.16
Cumulative effect of a change in accounting principle	$	—		$	—		$	—		$	—
Net income (loss)	$	(0.27	)	$	(0.21	)	$	0.72		$	(0.36	)
Diluted weighted average common shares (in thousands)	289,845			283,901			294,534			283,484

See accompanying notes to

condensed consolidated financial statements.

5

CABLEVISION SYSTEMS CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30, 2007 and 2006

(Dollars in thousands)

(Unaudited)

	2007			2006
Cash flows from operating activities:
Income (loss) from continuing operations	$	15,088		$	(146,546	)
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities:
Depreciation and amortization (including impairments)	843,497			840,782
Equity in net income of affiliates	(4,377		)	(5,872		)
Minority interests	(814		)	(1,279		)
Gain on sale of affiliate interests	(183,270		)	—
Loss (gain) on investments, net	31,505			(173,701		)
Write-off of deferred financing costs	2,919			14,083
Unrealized loss (gain) on derivative contracts	(43,348		)	143,159
Loss on extinguishment of debt	19,113			13,125
Amortization of deferred financing, discounts on indebtedness and other deferred costs	58,266			55,880
Share-based compensation expense related to equity classified awards	42,045			46,764
Deferred income tax	34,071			(144,532		)
Amortization and write-off of feature film inventory	100,028			91,598
Provision for doubtful accounts	40,228			28,942
Changes in other assets and liabilities	(326,822		)	(73,415		)
Net cash provided by operating activities	628,129			688,988
Cash flows from investing activities:
Capital expenditures	(554,371		)	(699,877		)
Proceeds from sale of equipment, net of costs of disposal	2,458			9,425
Decrease in investment securities and other investments	269			1,120
Decrease in restricted cash	2,433			2,614
Additions to other intangible assets	(3,115		)	(1,414		)
Proceeds from sale of affiliate interests	208,119			—
Distributions from equity method investees, net	24,506			—
Net cash used in investing activities	(319,701		)	(688,132		)
Cash flows from financing activities:
Proceeds from bank debt	73,000			5,438,000
Repayment of bank debt	(134,250		)	(2,260,250		)
Redemption of senior subordinated notes and debentures	(193,158		)	(263,125		)
Proceeds from stock option exercises	30,397			11,103
Proceeds from collateralized indebtedness	—			529,520
Repayment of collateralized indebtedness	—			(480,419		)
Dividend distribution to common stockholders	(67,313		)	(2,838,591		)
Proceeds from derivative contracts	—			6,496
Settlement of derivative contracts	—			(50,864		)
Payments on capital lease obligations and other debt	(5,472		)	(6,655		)
Deemed repurchase of restricted stock	(68,978		)	—
Additions to deferred financing and other costs	—			(47,374		)
Distributions to minority partners	(13,454		)	(13,458		)
Net cash provided by (used in) financing activities	(379,228		)	24,383
Net increase (decrease) in cash and cash equivalents from continuing operations	(70,800		)	25,239
Cash flows of discontinued operations:
Net cash provided by operating activities	17,827			95,727
Net cash provided by investing activities	312,358			4,013
Net change in cash classified in assets held for sale	24,461			15,401
Net effect of discontinued operations on cash and cash equivalents	354,646			115,141
Cash and cash equivalents at beginning of year	524,401			369,375
Cash and cash equivalents at end of period	$	808,247		$	509,755

See accompanying notes to

condensed consolidated financial statements.

6

CABLEVISION SYSTEMS CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share amounts)

(Unaudited)

NOTE 1.BUSINESS

Cablevision Systems Corporation and its majority-owned subsidiaries (“Cablevision” or the “Company”) own and operate cable television systems and through its wholly-owned subsidiary, Rainbow Media Holdings, LLC, have ownership interests in companies that produce and distribute national and regional entertainment and sports programming services, including Madison Square Garden, L.P. The Company also owns companies that provide advertising sales services for the cable television industry, provide telephone service, and operate motion picture theaters. The Company classifies its business interests into three reportable segments:  Telecommunications Services, consisting principally of its video, high-speed data, Voice over Internet Protocol and its commercial data and voice services operations; Rainbow, consisting principally of interests in national and regional television programming networks, including AMC, IFC, WE tv, fuse, News 12 and the VOOM HD Networks; and Madison Square Garden, which owns and operates professional sports teams, regional television sports programming networks and an entertainment business.

NOTE 2.BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Accordingly, these financial statements do not include all the information and notes required for complete annual financial statements.

The financial statements as of September 30, 2007 and for the three and nine months ended September 30, 2007 and 2006 presented in this Form 10-Q are unaudited; however, in the opinion of management, such financial statements include all adjustments, consisting solely of normal recurring adjustments, necessary for a fair presentation of the results for the periods presented.

The accompanying condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation.

The results of operations for the interim periods are not necessarily indicative of the results that might be expected for future interim periods or for the full year ending December 31, 2007.

The interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006 and the Company’s Form 8-K filed on August 10, 2007.

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

7

NOTE 3.INCOME (LOSS) PER COMMON SHARE

Basic net income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share reflects the dilutive effects of stock options, restricted stock, restricted stock units and other potentially dilutive financial instruments.

A reconciliation of the denominator of the basic and diluted net income per share calculation for the nine months ended September 30, 2007 is as follows:

	Nine Months Ended September 30, 2007
Basic weighted average shares outstanding	287,719
Effect of dilution:
Stock options	3,003
Restricted stock awards	3,812
Diluted weighted average shares outstanding	294,534

Anti-dilutive shares (options whose exercise price exceeds the average market price of the Company’s common stock during the period) totaling 421 have been excluded from diluted weighted average shares outstanding for the nine months ended September 30, 2007.

Basic and diluted net loss per common share are computed by dividing net loss by the weighted average number of common shares outstanding during the period. Potential dilutive common shares are not included in the diluted computation as their effect would be anti-dilutive.

The Company generated a loss from continuing operations for the three months ended September 30, 2007 and for the three and nine months ended September 30, 2006, therefore, the outstanding common stock equivalents during each of these periods were excluded from the computation of net loss per share as the impact would have been anti-dilutive.

NOTE 4.COMPREHENSIVE INCOME (LOSS)

The following table is a reconciliation of the Company’s net income (loss) to comprehensive income (loss) for the three and nine months ended September 30, 2007 and 2006:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Net income (loss)	$	(79,336	)	$	(59,157	)	$	211,820		$	(102,541	)
Other comprehensive income (loss):
Amortization of prior service cost and gains and losses included in net periodic benefit cost, net of taxes	4			—			(4		)	—
Comprehensive income (loss)	$	(79,332	)	$	(59,157	)	$	211,816		$	(102,541	)

8

NOTE 5.                RECLASSIFICATIONS

As a result of the sale of the Company’s 60% interest in Fox Sports Net Bay Area in June 2007, the net operating results of Fox Sports Net Bay Area have been classified as discontinued operations in the condensed consolidated statements of operations and cash flows for all periods presented. The net assets and liabilities of Fox Sports Net Bay Area as of December 31, 2006 have been classified as assets and liabilities held for sale in the condensed consolidated balance sheet. See Note 8 and Note 17.

NOTE 6.                CASH FLOWS

For purposes of the condensed consolidated statements of cash flows, the Company considers short-term investments with a maturity at date of purchase of three months or less to be cash equivalents.

During the nine months ended September 30, 2007 and 2006, the Company’s non-cash investing and financing activities and other supplemental data were as follows:

	Nine Months Ended September 30,
	2007		2006
Non-Cash Investing and Financing Activities:
Continuing Operations:
Capital lease obligations	$	2,276	$	11,751
Dividends payable on equity classified share-based awards	—		67,760
Redemption of collateralized indebtedness with related prepaid forward contracts and stock	102,469		250,412
Redemption of collateralized indebtedness with related prepaid forward contracts	—		31,385
Receivable related to sale of interest in equity method investee	4,767		—
Discontinued Operations:
Net interest accrued on make whole payment obligation to Loral	2,167		—
Receivable related to sale of affiliate interest	15,800		—
Supplemental Data:
Cash interest paid - continuing operations	710,629		604,877
Cash interest paid - discontinued operations	—		12
Income taxes paid, net	24,456		10,015

NOTE 7.RECENTLY ADOPTED ACCOUNTING STANDARDS

In December 2006, the Financial Accounting Standards Board (“FASB”) issued Staff Position No. EITF 00-19-2, Accounting for Registration Payment Arrangements (“FSP 00-19-2”). FSP 00-19-2 provides guidance related to the accounting for registration payment arrangements and specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate arrangement or included as a provision of a financial instrument or arrangement, should be separately recognized and measured in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 5, Accounting for Contingencies (“Statement No. 5”). FSP 00-19-2 requires that if the transfer of consideration under a registration payment arrangement is probable and can be reasonably estimated at inception, the contingent liability under such arrangement shall be included in the allocation of proceeds from the related financing transaction using the measurement guidance in Statement No. 5. FSP 00-19-2 applies immediately to any registration payment arrangement entered into subsequent to the issuance of FSP 00-19-2. For such arrangements entered into prior to the issuance of FSP 00-19-2, the guidance was effective for the Company as of January 1, 2007.

9

As a condition to the initial sale of CSC Holdings’ 6-3/4% Senior Notes due 2012, the Company entered into a registration rights agreement with the initial purchasers under which the Company agreed that it would file an exchange offer registration statement under the Securities Act with the Securities and Exchange Commission (“SEC”) and use its commercially reasonable best efforts to cause the exchange offer registration statement to be declared effective under the Securities Act. If the exchange offer was not completed by May 11, 2005, the agreement provided for an increase of 1/4% per annum in the interest rate for the first 90 days after May 11, 2005 and an additional 1/4% per annum, up to a maximum of 1/2% per annum, at the beginning of each subsequent 90 day period that the exchange offer was not completed. Upon the completion of the exchange, the interest rate would revert to 6-3/4%. In March 2007, the Company offered to exchange these notes for substantially identical publicly registered 6-3/4% Series B Senior Notes due 2012. This exchange was completed on April 26, 2007. In connection with the adoption of FSP 00-19-2 as of January 1, 2007, the Company recorded a charge of $443, net of tax, as a cumulative effect of a change in accounting principle representing the estimated fair value of the 1/2% penalty interest expected to be incurred under the registration rights agreement subsequent to January 1, 2007.

On January 1, 2007, the Company adopted FASB Interpretation No. (“FIN”) 48, Accounting for Uncertainty in Income Taxes - an interpretation of SFAS No. 109. This Interpretation clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS No. 109, Accounting for Income Taxes. FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of an income tax position taken or expected to be taken in an income tax return. The change in the net assets and liabilities recognized as a result of adopting the provisions of FIN 48 has been recorded as a charge of $442 to the opening balance of accumulated deficit.

In June 2006, the Emerging Issues Task Force reached a consensus on Issue No. 06-3, How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (That Is, Gross versus Net Presentation) (“EITF No. 06-3”), which addresses the income statement disclosures for taxes assessed by a governmental authority that is directly imposed on a revenue-producing transaction between a seller and a customer, and may include, but are not limited to, sales, use, value added, and some excise taxes. The presentation of taxes on either a gross (included in revenues and costs) or a net (excluded from revenues) basis is an accounting policy decision that should be disclosed pursuant to Accounting Principles Board Opinion No. 22. In addition, for any such taxes that are reported on a gross basis, a company should disclose the amounts of those taxes in interim and annual financial statements for each period for which an income statement is presented if those amounts are significant and can be done on an aggregate basis. EITF No. 06-3 was effective January 1, 2007 for the Company. For the three and nine months ended September 30, 2007 and 2006, the amount of franchise fees included as a component of net revenue aggregated $27,786 and $82,966, and $25,674 and $75,180, respectively.

10

NOTE 8.DISCONTINUED OPERATIONS AND NET ASSETS HELD FOR SALE

In June 2007, the Company completed the sale of its 60% interest in Fox Sports Net Bay Area, to Comcast Corporation (“Comcast”) (see Note 17). In addition, in June 2006 and April 2005, respectively, the operations of the Fox Sports Net Chicago programming business and the Rainbow DBS satellite distribution business were shut down. As a result, the operating results of these businesses, net of taxes, have been classified in the condensed consolidated statements of operations as discontinued operations for all periods presented. Operating results of discontinued operations for the three and nine months ended September 30, 2007 and 2006 are summarized below:

	Three Months Ended September 30, 2007
	Fox Sports Net Bay Area			Rainbow DBS distribution business			Total
Revenues, net	$	—		$	—		$	—
Loss before income taxes	$	(118	)	$	(628	)	$	(746	)
Income tax benefit	49			257			306
Net loss	$	(69	)	$	(371	)	$	(440	)

	Three Months Ended September 30, 2006
	Fox Sports Net Bay Area			Fox Sports Net Chicago (a)			Rainbow DBS distribution business			Total
Revenues, net	$	27,020		$	—		$	—		$	27,020
Income (loss) before income taxes	$	5,079		$	311		$	(1,025	)	$	4,365
Income tax benefit (expense)	(2,080		)	(127		)	420			(1,787		)
Net income (loss)	$	2,999		$	184		$	(605	)	$	2,578

	Nine Months Ended September 30, 2007
	Fox Sports Net Bay Area			Rainbow DBS distribution business			Total
Revenues, net	$	53,894		$	—		$	53,894
Income before income taxes, including gain on sale of Fox Sports Net Bay Area of $317,846	$	326,017		$	7,725		$	333,742
Income tax expense	(133,406		)	(3,161		)	(136,567		)
Net income, including gain on sale of Fox Sports Net Bay Area of $187,784, net of taxes	$	192,611		$	4,564		$	197,175

11

	Nine Months Ended September 30, 2006
	Fox Sports Net Bay Area			Fox Sports Net Chicago (a)			Rainbow DBS distribution business			Total
Revenues, net	$	75,844		$	78,974		$	—		$	154,818
Income (loss) before income taxes	$	11,807		$	72,601		$	(4,875	)	$	79,533
Income tax benefit (expense)	(4,835		)	(31,827		)	1,996			(34,666		)
Net income (loss)	$	6,972		$	40,774		$	(2,879	)	$	44,867

(a)Revenues, net includes $77,996 representing the collection in June 2006 of affiliate revenue from a cable affiliate, including $71,396 relating to periods prior to 2006, that had not been previously recognized due to a contractual dispute. The underlying contract was terminated in June 2006 and no further payments will be received under this contract.

In March 2007, the Federal Communications Commission (“FCC”) waived the bond requirement previously submitted by Rainbow DBS Company LLC with respect to five Ka-band licenses. These bonds were originally cash collateralized by the Company. In connection with the shut down of the Rainbow DBS satellite distribution business in 2005, the Company recorded a loss related to the outstanding bonds since the Company believed it was not probable that Rainbow DBS would meet the required FCC milestones. As a result of the waiver from the FCC, the Company recorded a gain of $6,638, net of taxes, in the quarter ended March 31, 2007. The Company received the cash collateral of $11,250 in the quarter ended June 30, 2007.

The assets and liabilities of Fox Sports Net Bay Area have been classified in the consolidated balance sheet as of December 31, 2006 as assets and liabilities held for sale and consist of the following:

	December 31, 2006
Cash and cash equivalents	$	24,461
Accounts receivable, prepaid expenses and other current assets	24,728
Property and equipment, net and other long-term assets	15,950
Intangible assets, net	63,162
Total assets held for sale	$	128,301
Accounts payable and accrued expenses	$	5,059
Other current liabilities	965
Other long-term liabilities	19
Total liabilities held for sale	$	6,043

12

NOTE 9.INTANGIBLE ASSETS

The following table summarizes information relating to the Company’s acquired intangible assets at September 30, 2007 and December 31, 2006:

	September 30, 2007		December 31, 2006
Gross carrying amount of amortizable intangible assets
Affiliation relationships and affiliate agreements	$	742,416	$	742,416
Broadcast rights and other agreements	45,590		45,590
Season ticket holder relationships	75,005		75,005
Suite holder contracts and relationships	21,167		21,167
Advertiser relationships	103,524		103,524
Other intangibles	43,933		40,819
	1,031,635		1,028,521
Accumulated amortization
Affiliation relationships and affiliate agreements	395,842		353,518
Broadcast rights and other agreements	38,143		36,806
Season ticket holder relationships	14,115		10,027
Suite holder contracts and relationships	8,306		5,815
Advertiser relationships	50,875		42,274
Other intangibles	22,769		19,139
	530,050		467,579
Indefinite-lived intangible assets
Cable television franchises	731,848		731,848
Sports franchises	96,215		96,215
FCC licenses and other intangibles	11,936		11,936
Trademarks	53,880		53,880
Excess costs over the fair value of net assets acquired	1,023,860		1,024,168
	1,917,739		1,918,047
Total intangible assets, net	$	2,419,324	$	2,478,989
Aggregate amortization expense
Nine months ended September 30, 2007 and year ended December 31, 2006 (excluding impairment charges of $899 for the year ended December 31, 2006)	$	62,630	$	84,803
Estimated amortization expense
Year ending December 31, 2007	$	83,238
Year ending December 31, 2008	81,064
Year ending December 31, 2009	74,655
Year ending December 31, 2010	71,649
Year ending December 31, 2011	70,901

13

NOTE 10.DEBT

On July 24, 2007, Rainbow National Services LLC (“RNS”), an indirect wholly-owned subsidiary of Cablevision entered into an equity commitment agreement with its sole member, Rainbow Programming Holdings LLC (“RPH”), an indirect wholly-owned subsidiary of Rainbow Media Holdings, pursuant to which RPH agreed to purchase additional membership interests in RNS for an aggregate purchase price of $203,000. RNS used the proceeds of the investment by RPH to redeem $175,000 in aggregate principal amount of its 10-3/8% senior subordinated notes due 2014, representing 35% of the outstanding notes, at a redemption price equal to 110.375% of the principal amount of the notes plus accrued and unpaid interest to August 31, 2007, the redemption date. In connection with the redemption, the Company recognized a loss on extinguishment of debt of $19,113, representing primarily the redemption premium, and the write-off of the related unamortized deferred financing costs of $2,919.

NOTE 11.COLLATERALIZED INDEBTEDNESS

The following table summarizes the settlement of the Company’s collateralized indebtedness for the nine months ended September 30, 2007. The Company’s collateralized indebtedness obligations relating to shares of Charter Communications, Inc. and Leapfrog Enterprises, Inc. were settled by delivering the underlying securities and the related equity derivative contracts.

	Charter			Leapfrog			Total
Number of shares	3,724,460			800,000
Collateralized indebtedness settled	$	(83,231	)	$	(19,238	)	$	(102,469	)
Prepaid forward contracts	70,903			10,638			81,541
Fair value of underlying securities delivered	12,328			8,600			20,928
Net cash payment	$	—		$	—		$	—

At September 30, 2007, the Company had collateralized indebtedness obligations of $172,822 that will mature during the next twelve months. The Company intends to settle such obligations either by delivering shares of the applicable stock and the related equity derivative contracts or by delivering cash from the net proceeds of a new monetization transaction. In the event of an early termination of any of these contracts, the Company would be expected to pay the counterparty an amount approximately equal to the fair value of the collateralized indebtedness less the sum of the fair values of the underlying stock and equity collar, calculated on or near the termination date.

NOTE 12.INCOME TAXES

The income tax expense attributable to continuing operations for the nine months ended September 30, 2007 of $53,586 differs from the income tax expense derived from applying the statutory federal rate to pretax income due principally to state taxes, tax expense of $5,027, including accrued interest, recorded pursuant to FIN 48, tax expense of $1,947 resulting from a change in the deferred tax rate, and the tax impact of non-deductible officers’ compensation and other non-deductible expenses of $7,314 and $4,436, respectively, partially offset by a decrease in the valuation allowance of $1,303 relating to certain state net operating loss carry forwards.

The income tax benefit attributable to continuing operations for the nine months ended September 30, 2006 of $137,591 differs from the income tax benefit derived from applying the statutory federal rate to the pretax loss due principally to state taxes, a decrease in the valuation allowance of $5,414 relating to certain state net operating loss carry forwards, a tax benefit of $5,013 resulting from the favorable

14

settlement of an issue with a taxing authority, and a tax benefit of $16,356 resulting from the reduction of a tax contingency liability, partially offset by the tax impact of non-deductible officers’ compensation and other non-deductible expenses of $3,951 and $4,780, respectively.

In general, the Company is required to use an estimated annual effective tax rate to measure the tax benefit or tax expense recognized in an interim period. The estimated annual effective tax rate is revised on a quarterly basis and therefore may be different from the rate used for a prior interim period. The income tax expense for the nine months ended September 30, 2007 was determined as if the interim period was a discrete period. However, the tax expense for the six months ended June 30, 2007 was determined using an estimated annual effective tax rate. The difference in methodology from June 2007 to September 2007 resulted from a change in our projection of pretax income from continuing operations excluding the gain on the sale of Fox Sports Net New England. After excluding the gain on the sale of Fox Sports Net New England, at September 30, 2007, the Company estimated a pretax loss for 2007, whereas at June 30, 2007 the Company had estimated pretax income. The income tax benefit for the three months ended September 30, 2007 is equal to the difference between the income tax provision for the six month and nine month periods ended June 30, 2007 and September 30, 2007.

Deferred tax assets have resulted primarily from the Company’s future deductible temporary differences and net operating loss carry forwards. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax asset will not be realized. The Company’s ability to realize its deferred tax assets depends upon the generation of sufficient future taxable income and tax planning strategies to allow for the utilization of its net operating loss carry forwards and deductible temporary differences. If such estimates and related assumptions change in the future, the Company may be required to record additional valuation allowances against certain of its deferred tax assets resulting in additional income tax expense in the Company’s consolidated statement of operations. Management evaluates the realizability of the deferred tax assets and the need for additional valuation allowances quarterly. Management believes that it is more likely than not that the Company will realize benefit for its gross deferred tax assets, except for certain of its deferred tax assets against which a valuation allowance has been recorded relating to certain state net operating loss carry forwards.

The Company takes certain positions on its tax returns that may be challenged by various taxing authorities. These tax positions arise in connection with certain transactions or operations.

The Company adopted the provisions of FIN 48 on January 1, 2007. The cumulative effect of applying the provisions of FIN 48 resulted in a charge of $442 to the opening balance of the accumulated deficit.

As of January 1, 2007, the Company had a gross liability of $10,353 for uncertain income tax positions, excluding accrued interest. After considering associated deferred tax benefits of $3,353, the net amount of liability for uncertain tax positions was $7,000 as of January 1, 2007. Therefore, if all uncertain tax positions were sustained at the amounts reported or expected to be reported in the Company’s tax returns, the Company’s income tax expense would decrease by $7,000.

Interest expense related to income tax liabilities recognized in accordance with the provisions of FIN 48 is included in income tax expense, consistent with the Company’s historical policy. Interest expense of $1,875 and the associated deferred tax benefit of $767 have been recognized in the nine month period ended September 30, 2007 and are included in income tax expense in the Company’s condensed consolidated statement of operations. At January 1, 2007, accrued interest on uncertain tax positions was $2,617 and was included in other current liabilities in the consolidated balance sheet.

15

As of January 1, 2007, the Company had a liability recorded with regard to the Ohio income tax audit for the year ended December 31, 2000 of $10,937, including accrued interest. During the three month period ended March 31, 2007, the liability, including accrued interest, was increased by $3,327, to $14,264, resulting in additional income tax expense in the Company’s condensed consolidated statement of operations. Such amount excludes the associated deferred tax benefit. In April 2007, the Company and representatives from the Ohio Department of Taxation agreed to settle the Ohio income tax audit for the tax year ended December 31, 2000 for $18,000, inclusive of interest. Therefore, the Company recognized additional income tax expense of $3,736, excluding deferred tax benefit, in the three month period ended June 30, 2007.

As of September 30, 2007, the Company had a liability of $1,963 for uncertain income tax positions, excluding accrued interest, net of deferred tax benefits of $640.

In July 2007, the Internal Revenue Service (“IRS”) completed its audit of the Company’s consolidated federal income tax returns for 2002 and 2003. The completion of this audit did not have a significant effect on the Company’s consolidated financial statements. In October 2007, the IRS began an audit of the Company’s consolidated federal income tax returns for 2004 and 2005.

With a few exceptions, the Company is no longer subject to state and local income tax audits by taxing authorities for years prior to 2003. The most significant jurisdictions in which the Company is required to file income tax returns include the state of New York, New Jersey and Connecticut and the city of New York. In September 2007, the state of New York started an audit of 2003 through 2005.

Management does not believe that the resolution of the ongoing income tax examinations described above will have a material adverse impact on the financial position of the Company. Changes in the liabilities for uncertain tax positions will be recognized in the interim period in which the positions are effectively settled or there is a change in factual circumstances.

16

NOTE 13.BENEFIT PLANS

Components of the net periodic pension cost, recorded primarily in selling, general and administrative expenses, for the Company’s qualified and non-qualified defined benefit and other postretirement plans for the three and nine months ended September 30, 2007 and 2006, are as follows:

	Cablevision Qualified and Non-qualified Defined Benefit Plans						Madison Square Garden Qualified and Non-qualified Defined Benefit Plans						Madison Square Garden Postretirement Benefit Plan
	Three Months Ended September 30,
	2007			2006			2007			2006			2007			2006
Service cost	$	7,904		$	7,345		$	1,201		$	1,247		$	91		$	99
Interest cost	2,510			2,053			1,480			1,360			95			90
Expected return on plan assets	(2,957		)	(2,470		)	(1,219		)	(921		)	––			––
Recognized prior service cost (credit)	––			3			6			6			(33		)	(33		)
Recognized actuarial (gain) loss	––			––			37			157			(3		)	(1		)
Recognized transition asset	––			––			(1		)	(1		)	––			––
Net periodic benefit cost	$	7,457		$	6,931		$	1,504		$	1,848		$	150		$	155

	Cablevision Qualified and Non-qualified Defined Benefit Plans						Madison Square Garden Qualified and Non-qualified Defined Benefit Plans						Madison Square Garden Postretirement Benefit Plan
	Nine Months Ended September 30,
	2007			2006			2007			2006			2007			2006
Service cost	$	23,711		$	22,034		$	3,604		$	3,741		$	275		$	299
Interest cost	7,530			6,159			4,439			4,081			285			271
Expected return on plan assets	(8,809		)	(7,411		)	(3,427		)	(2,764		)	––			––
Recognized prior service cost (credit)	––			9			19			19			(100		)	(100		)
Recognized actuarial (gain) loss	––			––			84			470			(8		)	(3		)
Recognized transition asset	––			––			(2		)	(2		)	––			––
Net periodic benefit cost	$	22,432		$	20,791		$	4,717		$	5,545		$	452		$	467

For the nine months ended September 30, 2007, the Company contributed $11,967 to the Madison Square Garden Qualified Defined Benefit Plans (the “MSG Qualified Plans”), $28,200 to the Cablevision Cash Balance Retirement Plan and currently does not expect to make any additional contributions to either the Cablevision Cash Balance Retirement Plan or the MSG Qualified Plans for the remainder of 2007.

17

NOTE 14.LEGAL MATTERS

Tracking Stock Litigation

In August 2002, purported class actions naming as defendants Cablevision and each of its directors were filed in the Delaware Chancery Court. The actions, which allege breach of fiduciary duties and breach of contract with respect to the exchange of the Rainbow Media Group tracking stock for Cablevision NY Group common stock, were purportedly brought on behalf of all holders of publicly traded shares of Rainbow Media Group tracking stock. The actions sought to (i) enjoin the exchange of Rainbow Media Group tracking stock for Cablevision NY Group common stock, (ii) enjoin any sales of “Rainbow Media Group assets,” or, in the alternative, award rescissory damages, (iii) if the exchange is completed, rescind it or award rescissory damages, (iv) award compensatory damages, and (v) award costs and disbursements. The actions were consolidated into one action on September 17, 2002, and on October 3, 2002, Cablevision filed a motion to dismiss the consolidated action. The action was stayed by agreement of the parties pending resolution of a related action brought by one of the plaintiffs to compel the inspection of certain books and records of Cablevision. On October 26, 2004, the parties entered into a stipulation dismissing the related action, and providing for Cablevision’s production of certain documents. On December 13, 2004, plaintiffs filed a consolidated amended complaint. Cablevision filed a motion to dismiss the amended complaint. On April 19, 2005, the court granted that motion in part, dismissing the breach of contract claim but declining to dismiss the breach of fiduciary duty claim on the pleadings.

In August 2003, a purported class action naming as defendants Cablevision, directors and officers of Cablevision and certain current and former officers and employees of the Company’s Rainbow Media Holdings and American Movie Classics subsidiaries was filed in New York Supreme Court by the Teachers Retirement System of Louisiana (“TRSL”). The actions relate to the August 2002 Rainbow Media Group tracking stock exchange and allege, among other things, that the exchange ratio was based upon a price of the Rainbow Media Group tracking stock that was artificially deflated as a result of the improper recognition of certain expenses at the national services division of Rainbow Media Holdings. The complaint alleges breaches by the individual defendants of fiduciary duties. The complaint also alleges breaches of contract and unjust enrichment by Cablevision. The complaint seeks monetary damages and such other relief as the court deems just and proper. On October 31, 2003, Cablevision and other defendants moved to stay the action in favor of the previously filed actions pending in Delaware or, in the alternative, to dismiss for failure to state a claim. On June 10, 2004, the court stayed the action on the basis of the previously filed action in Delaware. TRSL subsequently filed a motion to vacate the stay in the New York action, and simultaneously filed a motion to intervene in the Delaware action and to stay that action. Cablevision opposed both motions. On April 19, 2005, the court in the Delaware action denied the motion to stay the Delaware action and granted TRSL’s motion to intervene in that action. On June 22, 2005, the court in the New York action denied TRSL’s motion to vacate the stay in that action.

Cablevision reached an agreement in principle with respect to the settlement of the Delaware action in the quarter ended June 30, 2007. In connection with the anticipated settlement, Cablevision expects to seek dismissal of the New York action as well as the Delaware action.

The Wiz Bankruptcy

TW, Inc. (“TW”), a former subsidiary of the Company and operator of The Wiz consumer retail electronics business, is the subject of a Chapter 11 bankruptcy proceeding in the U.S. Bankruptcy Court for the District of Delaware. In February 2005, TW filed a complaint in the bankruptcy proceeding against Cablevision and certain of its affiliates seeking recovery of alleged preferential transfers in the

18

aggregate amount of $193,457. Also in February 2005, the Official Committee of Unsecured Creditors of TW (the “Committee”) filed a motion seeking authority to assume the prosecution of TW’s alleged preference claims and to prosecute certain other causes of action. The bankruptcy court granted the Committee’s motion on or about March 10, 2005, thereby authorizing the Committee, on behalf of TW, to continue the preference suit and to assert other claims. On March 12, 2005, the Committee filed a complaint in the bankruptcy court against Cablevision, certain of its affiliates, and certain present and former officers and directors of Cablevision and of its former subsidiary Cablevision Electronics Investments, Inc. (“CEI”). The Committee’s complaint, as amended, asserts preferential transfer claims allegedly totaling $193,858, breach of contract, promissory estoppel, and misrepresentation claims allegedly totaling $310,000, and fraudulent conveyance, breach of fiduciary duty, and other claims seeking unspecified damages. On June 30, 2005, the defendants filed a motion to dismiss several of the claims in the amended complaint. On October 31, 2005, the bankruptcy court denied the motion to dismiss. The bankruptcy court’s ruling on the motion to dismiss allowed the Committee to proceed with its claims against Cablevision and the other defendants. Cablevision believes that the claims asserted by the Committee are without merit and is contesting them vigorously.

Dolan Family Group 2006 Proposal

In October 2006, a number of shareholder class action lawsuits (the “Transactions Lawsuits”) were filed against Cablevision and its individual directors in New York Supreme Court, Nassau County, relating to the October 8, 2006 offer by the Dolan Family Group to acquire all of the outstanding shares of Cablevision’s common stock, except for the shares held by the Dolan Family Group. These lawsuits allege breaches of fiduciary duty and seek injunctive relief to prevent consummation of the proposed transaction and compensatory damages. (In addition, a similar claim was added to a shareholder derivative action involving claims for alleged options backdating that was pending in the District Court for the Eastern District of New York, which is described below under “Stock Option Related Matters.”)  The New York Supreme Court ordered expedited discovery, which began in November 2006. On January 12, 2007, the Special Transaction Committee of the Board (“Special Transaction Committee”) received a revised proposal from the Dolan Family Group to acquire all of the outstanding shares of common stock of Cablevision, except for the shares held by the Dolan Family Group. On January 16, 2007, the Special Transaction Committee delivered a letter to Charles F. Dolan and James L. Dolan, rejecting as inadequate the revised proposal. As discussed in Note 18, on May 2, 2007, Cablevision entered into a merger agreement pursuant to which, if the merger contemplated thereby was consummated, the Dolan Family Group would obtain ownership of all of the common stock equity of Cablevision (the “Proposed Merger”). Lawyers representing shareholders in certain of the Transactions Lawsuits, in consultation with lead counsel for the plaintiffs in the Nassau County Supreme Court options backdating litigations, participated in the negotiations to improve the financial terms of the Proposed Merger as well as to add certain contractual provisions designed to protect the rights of shareholders. Based upon the above events and circumstances, and the role that the lead counsel for the plaintiffs in the Transactions Lawsuits played in connection with the Proposed Merger, the parties subsequently reached a memorandum of understanding for the dismissal of the Transactions Lawsuits (and of the going-private claim in the cases pending in the U.S. District Court for the Eastern District of New York), subject to approval of a settlement by the Nassau County Supreme Court, and for the transfer to Cablevision, if the Proposed Merger were to be consummated, of the options-related derivative claims pending in the Nassau County Supreme Court and in the U.S. District Court for the Eastern District of New York. Pursuant to the memorandum of understanding, the parties executed a stipulation of settlement as of September 18, 2007. The stipulation of settlement was conditioned on, among other things, consummation of the Proposed Merger, and provided that the stipulation would become null and void and of no further force and effect in the event that this condition was not satisfied. This condition was not satisfied.

19

Director Litigation

Cablevision was named as a nominal defendant in a purported shareholder derivative complaint filed in the Court of Chancery of the State of Delaware. The action was brought derivatively on behalf of Cablevision and named as additional defendants Charles F. Dolan, the Chairman of Cablevision, and Rand Araskog, Frank Biondi, John Malone and Leonard Tow, each of whom was appointed as a director on March 2, 2005 by Mr. Dolan and certain other holders of the Company’s NY Group Class B common stock. The complaint alleges that Charles F. Dolan, as the controlling Class B shareholder of Cablevision, by purporting to remove three Cablevision Board members (William J. Bell, Sheila Mahony and Steven Rattner) and replace them with the four new directors, wrongfully interfered with the Board’s role in managing the affairs of Cablevision and sought to substitute his judgment of how to proceed with the VOOM service of Cablevision’s Rainbow DBS subsidiary above that of the Board. The action seeks, among other things, to preliminarily and permanently enjoin Charles F. Dolan from interfering with the managerial prerogatives of Cablevision’s Board; rescinding the purported appointment of the new directors; rescinding the removal of Mr. Bell, Ms. Mahony and Mr. Rattner as directors and restoring them to their positions as directors and directing Charles F. Dolan to account to Cablevision for its damages. There have been no developments in the case since May 2005, when the parties agreed that defendants need not respond to the complaint until further notice from the plaintiff.

Patent Litigation

Cablevision is named as a defendant in certain lawsuits claiming infringement of various patents relating to various aspects of our businesses. In certain of these cases other industry participants are also defendants. In certain of these cases we expect that any potential liability would be the responsibility of our equipment vendors pursuant to applicable contractual indemnification provisions. To the extent that the allegations in these lawsuits have been analyzed by us at the current stage of their proceedings, we believe that the claims are without merit and intend to defend the actions vigorously. The final disposition of these actions is not expected to have a material adverse effect on our consolidated financial position.

Contract Dispute

In September 2005, Loral filed an action against Cablevision and Rainbow DBS for breach of contract based on a letter agreement dated March 23, 2001 (“the Letter Agreement”) between Loral and Rainbow DBS. Loral alleges that the sale of the Rainbow-1 satellite and related assets to EchoStar constituted a sale of “substantially all of the assets of Rainbow DBS” triggering a “Make Whole Payment” under the Letter Agreement of $33,000 plus interest. A trial in this matter took place in January 2007 in New York Supreme Court for New York County. On January 24, 2007, the jury returned a verdict finding that the EchoStar sale had triggered a Make Whole Payment under the Letter Agreement, requiring a payment to Loral of $50,898, including interest, which was accrued for as of December 31, 2006 and reflected as an expense in discontinued operations. On March 12, 2007, judgment was entered against Cablevision and Rainbow DBS in the amount of $52,159. Cablevision and Rainbow DBS filed a motion for judgment as a matter of law, or in the alternative for a new trial, which was denied by the court on March 30, 2007. The Company has posted a cash collateralized bond in the amount of $52,159, which is reflected as restricted cash in the Company’s condensed consolidated balance sheet at September 30, 2007, and the Company is in the process of appealing the judgment.

20

Accounting Related Investigations

The improper expense recognition matter previously reported by the Company has been the subject of investigations by the SEC and the U.S. Attorney’s Office for the Eastern District of New York. The SEC is continuing to investigate the improper expense recognition matter and the Company’s timing of recognition of launch support, marketing and other payments under affiliation agreements. The Company continues to fully cooperate with such investigations.

Stock Option Related Matters

The Company announced on August 8, 2006 that, based on a voluntary review of its past practices in connection with grants of stock options and stock appreciation rights (“SARs”), it had determined that the grant date and exercise price assigned to a number of its stock option and SAR grants during the 1997-2002 period did not correspond to the actual grant date and the fair market value of Cablevision’s common stock on the actual grant date. The review was conducted with a law firm that was not previously involved with the Company’s stock option plans. The Company has advised the SEC and the U.S. Attorney’s Office for the Eastern District of New York of these matters and each has commenced an investigation. The Company received a grand jury subpoena from the U.S. Attorney’s Office for the Eastern District of New York seeking documents related to the stock options issues. The Company received a document request from the SEC relating to its informal investigation into these matters. The Company continues to fully cooperate with such investigations.

In addition, in August, September and October 2006, purported derivative lawsuits (including one purported combined derivative and class action lawsuit) relating to the Company’s past stock option and SAR grants were filed in New York State Supreme Court for Nassau County, the United States District Court for the Eastern District of New York, and Delaware Chancery Court for New Castle County, by parties identifying themselves as shareholders of Cablevision purporting to act on behalf of Cablevision. These lawsuits named as defendants certain present and former members of Cablevision’s Board of Directors and certain present and former executive officers, alleging breaches of fiduciary duty and unjust enrichment relating to practices with respect to the dating of stock options, recordation and accounting for stock options, financial statements and SEC filings, and alleged violation of IRC 162(m). In addition, certain of these lawsuits asserted claims under Sections 10(b), 14(a), and 20(a) of the Securities Exchange Act of 1934 and Section 304 of the Sarbanes-Oxley Act. The lawsuits sought damages from all defendants, disgorgement from the officer defendants, declaratory relief, and equitable relief, including rescission of the 2006 Employee Stock Plan and voiding of the election of the director defendants. On October 27, 2006, the Board of Directors of Cablevision appointed Grover C. Brown and Zachary W. Carter as directors and, on the same date, appointed Messrs. Brown and Carter to a newly formed special litigation committee (“SLC”) of the Board. The SLC was directed by the Board to review and analyze the facts and circumstances surrounding these claims, which purport to have been brought derivatively on behalf of the Company, and to consider and determine whether or not prosecution of such claims is in the best interests of the Company and its shareholders, and what actions the Company should take with respect to the cases. The SLC, through its counsel, filed motions in all three courts to intervene and to stay all proceedings until completion of the SLC’s independent investigation of the claims raised in these actions. The Delaware action subsequently was voluntarily dismissed without prejudice by the plaintiff. The actions pending in Nassau County have been consolidated and a single amended complaint has been filed in that jurisdiction. Similarly, the actions pending in the Eastern District of New York have been consolidated and a single amended complaint has been filed in that jurisdiction. Both the Nassau County action and the Eastern District of New York action assert derivative claims on behalf of the Company as well as direct claims on behalf of Cablevision shareholders relating to the Company’s past stock option

21

and SAR grants. On November 14, 2006, the trial court in the Nassau County action denied the SLC’s motion for a stay of proceedings and ordered expedited discovery. The Appellate Division of the New York State Supreme Court subsequently stayed all proceedings in the Nassau County action (including all discovery) pending the SLC’s appeal of the denial of its stay motion. On October 9, 2007, the Appellate Division affirmed the trial court’s denial of the SLC’s motion to stay proceedings. The U.S. District Court for the Eastern District of New York granted the SLC’s motion for a stay and stayed the cases pending in that court until June 12, 2007. On June 12, 2007, the SLC requested an extension of the stay until either the closing of the Proposed Merger or 30 days after it is determined that the transaction will not close. On June 26, 2007, the court granted the requested extension of the stay.

As discussed in Note 18, on May 2, 2007, Cablevision entered into a merger agreement pursuant to which the Dolan Family Group would obtain ownership of all of the common stock equity of Cablevision in the Proposed Merger. Included in the $36.26 per share merger consideration that would have been provided to shareholders in the Proposed Merger was merger consideration payable in exchange for the surviving corporation’s succeeding to Cablevision’s and shareholders’ rights in connection with claims involving alleged options backdating. As discussed above (under “Dolan Family Group 2006 Proposal”), the stipulation of settlement providing for the succession of those claims was conditioned on, among other things, consummation of the Proposed Merger. This condition was not satisfied.

We have continued to incur substantial expenses for legal services in connection with the Company’s stock option related litigation and the investigations by the SEC and the U.S. Attorney’s Office for the Eastern District of New York.

Other Matters

In addition to the matters discussed above, the Company is party to various lawsuits, some involving claims for substantial damages. Although the outcome of these other matters cannot be predicted with certainty and the impact of the final resolution of these other matters on the Company’s results of operations in a particular subsequent reporting period is not known, management does not believe that the resolution of these other lawsuits will have a material adverse effect on the financial position of the Company or the ability of the Company to meet its financial obligations as they become due.

NOTE 15.SEGMENT INFORMATION

The Company classifies its business interests into three reportable segments: Telecommunications Services, consisting principally of its video, high-speed data, Voice over Internet Protocol and its commercial data and voice services operations; Rainbow, consisting principally of interests in national and regional television programming networks, including AMC, IFC, WE tv, fuse, News 12 and the VOOM HD Networks; and Madison Square Garden, which owns and operates professional sports teams, regional television sports programming networks and an entertainment business.

The Company’s reportable segments are strategic business units that are managed separately. The Company evaluates segment performance based on several factors, of which the primary financial measure is business segment adjusted operating cash flow (defined as operating income (loss) before depreciation and amortization (including impairments), share-based compensation expense or benefit and restructuring charges or credits), a non-GAAP measure. The Company has presented the components that reconcile adjusted operating cash flow to operating income (loss), an accepted GAAP measure. Information as to the operations of the Company’s business segments is set forth below.

22

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Revenues, net from continuing operations
Telecommunications Services	$	1,179,471		$	1,075,754		$	3,503,598		$	3,118,087
Rainbow	221,751			190,022			650,516			573,490
Madison Square Garden	130,259			128,516			548,191			514,402
All other (a)	21,089			21,249			55,725			59,476
Intersegment eliminations	(40,771		)	(33,825		)	(115,614		)	(99,282		)
	$	1,511,799		$	1,381,716		$	4,642,416		$	4,166,173

Intersegment eliminations are primarily affiliate revenues recognized by our Rainbow and MSG segments from the sale of cable network programming to our Telecommunication Services segment.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Intersegment Revenues
Telecommunications Services	$	388	$	411	$	1,225	$	1,247
Rainbow	14,513		9,765		36,104		27,644
Madison Square Garden	25,870		23,649		78,285		70,391
	$	40,771	$	33,825	$	115,614	$	99,282

Reconciliation (by Segment and in Total) of Adjusted Operating Cash Flow to Operating Income (Loss) from Continuing Operations

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Adjusted operating cash flow from continuing operations
Telecommunications Services	$	446,524		$	411,544		$	1,330,871		$	1,232,281
Rainbow	51,912			36,697			132,943			81,186
Madison Square Garden	10,238			(6,093		)	60,367			18,788
All other (b)	(14,392		)	(14,142		)	(47,662		)	(53,248		)
	$	494,282		$	428,006		$	1,476,519		$	1,279,007

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Depreciation and amortization (including impairments) included in continuing operations
Telecommunications Services	$	233,100	$	233,871	$	700,917	$	686,506
Rainbow	22,992		24,709		69,881		73,307
Madison Square Garden	14,124		15,616		43,645		46,271
All other (b)	9,983		11,011		29,054		34,698
	$	280,199	$	285,207	$	843,497	$	840,782

23

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Share-based compensation expense included in continuing operations
Telecommunications Services	$	5,374	$	9,154	$	23,079	$	27,784
Rainbow	2,957		5,211		15,792		17,689
Madison Square Garden	2,300		2,846		9,724		9,757
All other (b)	277		345		1,090		1,338
	$	10,908	$	17,556	$	49,685	$	56,568

	Three Months Ended September 30,					Nine Months Ended September 30,
	2007		2006			2007		2006
Restructuring charges (credits) included in continuing operations
Telecommunications Services	$	—	$	—		$	—	$	(17	)
Rainbow	971		––			2,496		143
Madison Square Garden	––		––			––		––
All other (b)	136		(1,729		)	66		(4,609		)
	$	1,107	$	(1,729	)	$	2,562	$	(4,483	)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Operating income (loss) from continuing operations
Telecommunications Services	$	208,050		$	168,519		$	606,875		$	518,008
Rainbow	24,992			6,777			44,774			(9,953		)
Madison Square Garden	(6,186		)	(24,555		)	6,998			(37,240		)
All other (b)	(24,788		)	(23,769		)	(77,872		)	(84,675		)
	$	202,068		$	126,972		$	580,775		$	386,140

24

A reconciliation of reportable segment amounts to the Company’s consolidated balances is as follows:

	Three Months Ended September 30,						Nine Months EndedSeptember 30,
	2007			2006			2007			2006
Income (loss) from continuing operations before income taxes
Total operating income for reportable segments	$	226,856		$	150,741		$	658,647		$	470,815
Other operating loss (b)	(24,788		)	(23,769		)	(77,872		)	(84,675		)
Operating income	202,068			126,972			580,775			386,140
Items excluded from operating income:
Interest expense	(237,487		)	(243,390		)	(714,337		)	(686,100		)
Interest income	13,353			4,581			28,317			27,118
Equity in net income of affiliates	––			2,677			4,377			5,872
Gain (loss) on sale of affiliate interests	(618		)	––			183,270			––
Gain (loss) on investments, net	(46,136		)	100,922			(31,505		)	179,113
Gain (loss) on derivative contracts, net	1,185			(130,019		)	37,087			(172,634		)
Write-off of deferred financing costs	(2,919		)	(6,084		)	(2,919		)	(14,083		)
Loss on extinguishment of debt	(19,113		)	––			(19,113		)	(13,125		)
Minority interests	(401		)	381			814			1,279
Miscellaneous, net	457			2,256			1,908			2,283
Income (loss) from continuing operations before income taxes	$	(89,611	)	$	(141,704	)	$	68,674		$	(284,137	)

(a)Represents net revenues of Clearview Cinemas and PVI Virtual Media.

(b)Principally includes unallocated corporate general and administrative costs, in addition to the operating results of Clearview Cinemas and PVI Virtual Media. The 2007 and 2006 periods also include costs allocated to Fox Sports Net Bay Area that were not eliminated as a result of the sale of that business. The 2006 periods also include costs allocated to Fox Sports Net Chicago that were not eliminated as a result of the shut down of that business.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Capital Expenditures
Telecommunications Services	$	202,713	$	194,037	$	515,098	$	662,560
Rainbow	6,277		6,440		12,173		11,558
Madison Square Garden	9,469		6,137		15,594		12,511
Corporate and other	2,747		4,918		11,506		13,248
	$	221,206	$	211,532	$	554,371	$	699,877

Substantially all revenues and assets of the Company’s reportable segments are attributed to or located in the United States primarily concentrated in the New York metropolitan area.

Concentrations of Credit Risk

Financial instruments that may potentially subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents and trade receivables. Cash is invested in money market funds and bank time deposits. The Company’s cash investments are placed with money market funds or financial institutions that have received the highest rating awarded by Standard & Poor’s and Moody’s Investors Service. The Company selects money market funds that predominately invest in marketable, direct obligations issued or guaranteed by the United States government or its agencies, commercial paper, fully collateralized repurchase agreements, certificates of deposit, banker’s acceptances and time deposits. The

25

Company did not have any customers that accounted for 10% or more of the Company’s consolidated net trade receivable balances or 10% or more of the Company’s consolidated net revenues at or for the nine months ended September 30, 2007.

NOTE 16.EQUITY AND LONG-TERM INCENTIVE PLANS

The following table summarizes activity for the Company’s restricted shares for the nine months ended September 30, 2007:

	Number of Restricted Shares		Weighted Average Fair Value Per Share at Date of Grant
Unvested award balance, December 31, 2006	8,108,639		$	19.26
Granted	2,002,454		29.23
Awards vested	(5,379,692	)	18.30
Forfeited	(362,622	)	19.78
Unvested award balance, September 30, 2007	4,368,779		$	24.97

The Company recognizes compensation expense for restricted shares and restricted stock units using a straight-line amortization method, based on the grant date price of Cablevision NY Group Class A common stock over the vesting period, except for restricted stock units granted to non-employee directors which vest 100% and are expensed at the date of grant.

In August 2007, June 2007 and March 2007, 35,000, 1,220,887 and 4,116,499 restricted shares, respectively, issued to employees of the Company vested. To fulfill the employees’ statutory minimum tax withholding obligations of $500, $18,784 and $49,693, respectively, for the applicable income and other employment taxes, 15,457, 529,692 and 1,609,749, respectively, of these shares were surrendered to the Company. The 2,154,898 acquired shares have been classified as treasury stock. These net share settlements had no impact on the amount of compensation cost recognized in respect of these awards. Additionally, in connection with the vesting of these shares, the Company paid the special dividend related to such shares that was declared and accrued in 2006 aggregating $53,680.

Share-based compensation, including compensation relating to restricted shares, for the three and nine months ended September 30, 2007 and 2006 was $10,908 and $17,556, and $49,685 and $56,568, respectively.

Incentive Plans

Pursuant to Cablevision’s Cash Incentive Plan, the prior Long-Term Incentive Plan and Executive Performance Incentive Plan, executive officers and other members of management have been granted cash awards, some of which are time-based and some of which are both time-based and performance- based, that vest over varying required service periods and are typically payable at the end of the vesting period or on specified dates.

In connection with all long-term incentive awards granted under the Company’s Long-Term Incentive plans, the Company has recorded expense of $18,605 and $55,090, for the three and nine months ended September 30, 2007, respectively, and $14,433 and $44,376 for the three and nine month periods ended September 30, 2006, respectively. At September 30, 2007 and December 31, 2006, the Company had accrued $91,426 and $51,905, respectively, for its performance-based cash awards for which the performance criteria had not been satisfied as of September 30, 2007, as such awards are based on

26

achievement of certain performance criteria through various dates ending on December 31, 2009.  The Company has accrued approximately $49,867 in connection with its 2005 Long-Term Incentive Award through September 30, 2007. The performance targets for this award run through December 31, 2007.

The Company currently believes that it is probable that each of its performance-based awards will ultimately be paid. However, if the Company subsequently determines that it is probable that such awards will not be paid, the Company would reverse the related accrual in respect of such award in the period such determination is made.

NOTE 17.TRANSACTIONS

Sale of Fox Sports Net Bay Area and Fox Sports Net New England

In June 2007, Rainbow Media Holdings completed its sale to Comcast of (i) its 60% interest in Fox Sports Net Bay Area, for a purchase price of $366,750 (the “Bay Area Sale”) and (ii) its 50% interest in Fox Sports Net New England, for a purchase price of $203,250 (the “New England Sale”), for an aggregate purchase price of $570,000, plus certain additional consideration to Rainbow Media Holdings, subject to customary working capital adjustments.

The Company recorded a pretax gain of $183,270 ($108,276, net of taxes) in connection with the New England Sale and a pretax gain of $317,846 ($187,784, net of taxes), relating to the Bay Area Sale. The net operating results of Fox Sports Net Bay Area have been classified as discontinued operations for all periods presented. The net operating results of Fox Sports Net Bay Area were previously reported in the Rainbow segment.

Contemporaneously with the execution of the agreement relating to the Bay Area Sale and the New England Sale, subsidiaries of the Company and Comcast entered into or extended affiliation agreements relating to (i) the carriage of the Versus and Golf Channel programming services on the Company’s cable television systems and (ii) the carriage of AMC, fuse, IFC, WE tv, Lifeskool, sportskool, MSG and Fox Sports Net New York on Comcast’s cable television systems.

NOTE 18.DOLAN FAMILY GROUP TRANSACTION

On May 2, 2007, Cablevision entered into a merger agreement with Central Park Holding Company, LLC (“Dolan Family Acquisition Company”), an entity owned by the Dolan Family Group, and Central Park Merger Sub, Inc. The terms of the merger agreement provided that Central Park Merger Sub, Inc. would be merged with and into Cablevision and, as a result, Cablevision would continue as the surviving corporation and a wholly-owned subsidiary of Dolan Family Acquisition Company (the “Proposed Merger”).

On October 24, 2007, the Proposed Merger was submitted to a vote of Cablevision’s shareholders and did not receive shareholder approval. Subsequently, the parties terminated the merger agreement pursuant to its terms.

27

CSC HOLDINGS, INC. AND SUBSIDIARIES

(a wholly-owned subsidiary of Cablevision Systems Corporation)

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share amounts)

	September 30, 2007		December 31, 2006
	(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	764,333	$	390,143
Restricted cash	62,312		11,390
Accounts receivable, trade (less allowance for doubtful accounts of $14,475 and $17,257)	503,123		516,533
Prepaid expenses and other current assets	224,167		175,787
Feature film inventory, net	125,065		124,778
Deferred tax asset	389,940		236,037
Investment securities pledged as collateral	195,130		—
Advances to affiliates	310,613		229,677
Derivative contracts	771		81,140
Assets held for sale	—		49,189
Total current assets	2,575,454		1,814,674
Property, plant and equipment, net of accumulated depreciation of $6,885,510 and $6,254,510	3,483,713		3,713,030
Investments in affiliates	—		49,950
Notes and other receivables	41,421		29,659
Investment securities pledged as collateral	851,718		1,080,229
Other assets	88,908		80,273
Feature film inventory, net	400,226		375,700
Deferred carriage fees, net	157,539		173,059
Cable television franchises	731,848		731,848
Affiliation, broadcast and other agreements, net of accumulated amortization of $433,985 and $390,324	354,021		397,682
Other intangible assets, net of accumulated amortization of $96,065 and $77,255	309,595		325,291
Excess costs over fair value of net assets acquired	1,023,860		1,024,168
Deferred financing and other costs, net of accumulated amortization of $66,099 and $55,445	89,939		98,553
Assets held for sale	—		79,112
	$	10,108,242	$	9,973,228

See accompanying notes to

condensed consolidated financial statements.

28

	September 30, 2007			December 31, 2006
	(unaudited)
LIABILITIES AND STOCKHOLDER’S DEFICIENCY
Current Liabilities:
Accounts payable	$	396,664		$	389,400
Accrued liabilities	758,091			934,462
Deferred revenue	235,001			162,463
Feature film and other contract obligations	116,616			121,890
Liabilities under derivative contracts	10,423			6,568
Bank debt	125,000			93,750
Collateralized indebtedness	172,822			102,268
Capital lease obligations	5,761			7,069
Notes payable	1,017			17,826
Senior notes and debentures	999,991			499,952
Liabilities held for sale	—			6,024
Total current liabilities	2,821,386			2,341,672
Feature film and other contract obligations	307,186			312,344
Deferred revenue	13,835			14,337
Deferred tax liability	609,958			262,843
Liabilities under derivative contracts	165,617			204,887
Other liabilities	310,235			326,306
Bank debt	4,806,250			4,898,750
Collateralized indebtedness	667,274			819,306
Senior notes and debentures	3,494,862			3,994,004
Senior subordinated notes and debentures	323,247			497,011
Notes payable	—			1,017
Capital lease obligations	52,501			54,389
Minority interests	784			49,670
Liabilities held for sale	—			19
Total liabilities	13,573,135			13,776,555
Commitments and contingencies
Stockholder’s deficiency:
Series A Cumulative Convertible Preferred Stock, 200,000 shares authorized, none issued	—			—
Series B Cumulative Convertible Preferred Stock, 200,000 shares authorized, none issued	—			—
8% Series D Cumulative Preferred Stock, $.01 par value, 112,500 shares authorized, none issued ($100 per share liquidation preference)	—			—
Preferred Stock, $.01 par value, 9,487,500 shares authorized, none issued	—			—
Common Stock, $.01 par value, 20,000,000 shares authorized, 11,595,635 shares issued and outstanding	116			116
Paid-in capital	171,210			120,017
Accumulated deficit	(3,624,265		)	(3,911,510		)
	(3,452,939		)	(3,791,377		)
Accumulated other comprehensive loss	(11,954		)	(11,950		)
Total stockholder’s deficiency	(3,464,893		)	(3,803,327		)
	$	10,108,242		$	9,973,228

See accompanying notes to

condensed consolidated financial statements

29

CSC HOLDINGS, INC. AND SUBSIDIARIES

(a wholly-owned subsidiary of Cablevision Systems Corporation)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three and Nine Months Ended September 30, 2007 and 2006

(Dollars in thousands)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Revenues, net	$	1,511,799		$	1,381,716		$	4,642,416		$	4,166,173
Operating expenses:
Technical and operating (excluding depreciation, amortization and impairments shown below)	637,807			624,820			2,053,732			1,869,002
Selling, general and administrative	390,618			346,446			1,161,850			1,074,732
Restructuring charges (credits)	1,107			(1,729		)	2,562			(4,483		)
Depreciation and amortization (including impairments)	280,199			285,207			843,497			840,782
	1,309,731			1,254,744			4,061,641			3,780,033
Operating income	202,068			126,972			580,775			386,140
Other income (expense):
Interest expense	(203,733		)	(209,891		)	(613,422		)	(587,134		)
Interest income	12,784			4,559			25,176			26,452
Equity in net income of affiliates	—			2,677			4,377			5,872
Gain (loss) on sale of affiliate interests	(618		)	—			183,270			—
Gain (loss) on investments, net	(46,136		)	100,518			(31,505		)	178,594
Gain (loss) on derivative contracts, net	1,185			(130,019		)	37,087			(172,634		)
Write-off of deferred financing costs	(2,919		)	(6,084		)	(2,919		)	(14,083		)
Loss on extinguishment of debt	(19,113		)	—			(19,113		)	(13,125		)
Minority interests	(401		)	381			814			1,279
Miscellaneous, net	457			2,256			1,908			2,283
	(258,494		)	(235,603		)	(414,327		)	(572,496		)
Income (loss) from continuing operations before income taxes	(56,426		)	(108,631		)	166,448			(186,356		)
Income tax benefit (expense)	14,759			67,816			(75,493		)	97,435
Income (loss) from continuing operations	(41,667		)	(40,815		)	90,955			(88,921		)
Income (loss) from discontinued operations, including gain on sale of Fox Sports Net Bay Area of $187,784, net of taxes	(440		)	2,578			197,175			44,867
Income (loss) before cumulative effect of a change in accounting principle	(42,107		)	(38,237		)	288,130			(44,054		)
Cumulative effect of a change in accounting principle, net of taxes	—			—			(443		)	(862		)
Net income (loss)	$	(42,107	)	$	(38,237	)	$	287,687		$	(44,916	)

See accompanying notes to

condensed consolidated financial statements.

30

CSC HOLDINGS, INC. AND SUBSIDIARIES

(a wholly-owned subsidiary of Cablevision Systems Corporation)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine Months Ended September 30, 2007 and 2006

(Dollars in thousands)

(Unaudited)

	2007			2006
Cash flows from operating activities:
Income (loss) from continuing operations	$	90,955		$	(88,921	)
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities:
Depreciation and amortization (including impairments)	843,497			840,782
Equity in net income of affiliates	(4,377		)	(5,872		)
Minority interests	(814		)	(1,279		)
Gain on sale of affiliate interests	(183,270		)	—
Loss (gain) on investments, net	31,505			(173,195		)
Write-off of deferred financing costs	2,919			14,083
Unrealized loss (gain) on derivative contracts	(43,348		)	143,159
Loss on extinguishment of debt	19,113			13,125
Amortization of deferred financing, discounts on indebtedness and other deferred costs	54,647			52,261
Share-based compensation expense related to equity classified awards	42,045			46,764
Deferred income tax	52,996			(104,491		)
Amortization and write-off of feature film inventory	100,028			91,598
Provision for doubtful accounts	40,228			28,942
Changes in other assets and liabilities	(437,341		)	(160,932		)
Net cash provided by operating activities	608,783			696,024
Cash flows from investing activities:
Capital expenditures	(554,371		)	(699,877		)
Proceeds from sale of equipment, net of costs of disposal	2,458			9,425
Decrease in investment securities and other investments	269			705
Decrease in restricted cash	2,433			2,614
Additions to other intangible assets	(3,115		)	(1,414		)
Proceeds from sale of affiliate interests	208,119			—
Distributions from equity method investees, net	24,506			—
Net cash used in investing activities	(319,701		)	(688,547		)
Cash flows from financing activities:
Proceeds from bank debt	73,000			5,438,000
Repayment of bank debt	(134,250		)	(2,260,250		)
Redemption of senior subordinated notes and debentures	(193,158		)	(263,125		)
Proceeds from collateralized indebtedness	—			529,520
Repayment of collateralized indebtedness	—			(480,419		)
Capital contribution from (distribution to) Cablevision	3,796			(2,959,645		)
Proceeds from derivative contracts	—			(44,368		)
Payments on capital lease obligations and other debt	(5,472		)	(6,655		)
Additions to deferred financing and other costs	—			(47,374		)
Distributions to minority partners	(13,454		)	(13,458		)
Net cash used in financing activities	(269,538		)	(107,774		)
Net increase (decrease) in cash and cash equivalents from continuing operations	19,544			(100,297		)
Cash flows of discontinued operations:
Net cash provided by operating activities	17,827			95,727
Net cash provided by investing activities	312,358			4,013
Net change in cash classified in assets held for sale	24,461			15,401
Net effect of discontinued operations on cash and cash equivalents	354,646			115,141
Cash and cash equivalents at beginning of year	390,143			366,848
Cash and cash equivalents at end of period	$	764,333		$	381,692

See accompanying notes to

condensed consolidated financial statements.

31

CSC HOLDINGS, INC. AND SUBSIDIARIES

(a wholly-owned subsidiary of Cablevision Systems Corporation)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in thousands, except per share amounts)

(Unaudited)

NOTE 1.BUSINESS

CSC Holdings, Inc. (“CSC Holdings” or the “Company”), is a wholly-owned subsidiary of Cablevision Systems Corporation (“Cablevision”).  The Company and its majority-owned subsidiaries own and operate cable television systems and through the Company’s wholly-owned subsidiary, Rainbow Media Holdings, LLC, have ownership interests in companies that produce and distribute national and regional entertainment and sports programming services, including Madison Square Garden, L.P.  The Company also owns companies that provide advertising sales services for the cable television industry, provide telephone service, and operate motion picture theaters.  The Company classifies its business interests into three reportable segments:  Telecommunications Services, consisting principally of its video, high-speed data, Voice over Internet Protocol and its commercial data and voice services operations; Rainbow, consisting principally of interests in national and regional television programming networks, including AMC, IFC, WE tv, fuse, News 12 and the VOOM HD Networks; and Madison Square Garden, which owns and operates professional sports teams, regional television sports programming networks and an entertainment business.

NOTE 2.BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information.  Accordingly, these financial statements do not include all the information and notes required for complete annual financial statements.

The financial statements as of September 30, 2007 and for the three and nine months ended September 30, 2007 and 2006 presented in this Form 10-Q are unaudited; however, in the opinion of management, such financial statements include all adjustments, consisting solely of normal recurring adjustments, necessary for a fair presentation of the results for the periods presented.

The accompanying condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries.  All significant intercompany transactions and balances have been eliminated in consolidation.

The results of operations for the interim periods are not necessarily indicative of the results that might be expected for future interim periods or for the full year ending December 31, 2007.

The interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006 and the Company’s Form 8-K filed on August 10, 2007.

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

32

NOTE 3.INCOME (LOSS) PER COMMON SHARE

Net income (loss) per common share is not presented since the Company is a wholly-owned subsidiary of Cablevision.

NOTE 4.COMPREHENSIVE INCOME (LOSS)

The following table is a reconciliation of the Company’s net income (loss) to comprehensive income (loss) for the three and nine months ended September 30, 2007 and 2006:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Net income (loss)	$	(42,107	)	$	(38,237	)	$	287,687		$	(44,916	)
Other comprehensive income (loss):
Amortization of prior service cost and gains and losses included in net periodic benefit cost, net of taxes	4			—			(4		)	—
Comprehensive income (loss)	$	(42,103	)	$	(38,237	)	$	287,683		$	(44,916	)

NOTE 5.RECLASSIFICATIONS

As a result of the sale of the Company’s 60% interest in Fox Sports Net Bay Area in June 2007, the net operating results of Fox Sports Net Bay Area have been classified as discontinued operations in the condensed consolidated statements of operations and cash flows for all periods presented.  The net assets and liabilities of Fox Sports Net Bay Area as of December 31, 2006 have been classified as assets and liabilities held for sale in the condensed consolidated balance sheet.  See Note 8 and Note 17.

33

NOTE 6.CASH FLOWS

For purposes of the condensed consolidated statements of cash flows, the Company considers short-term investments with a maturity at date of purchase of three months or less to be cash equivalents.

During the nine months ended September 30, 2007 and 2006, the Company’s non-cash investing and financing activities and other supplemental data were as follows:

	Nine Months Ended September 30,
	2007		2006
Non-Cash Investing and Financing Activities:
Continuing Operations:
Capital lease obligations	$	2,276	$	11,751
Dividends payable on equity classified share-based awards	—		—
Redemption of collateralized indebtedness with related prepaid forward contracts and stock	102,469		250,412
Redemption of collateralized indebtedness with related prepaid forward contracts	—		31,385
Receivable related to sale of interest in equity method investee	4,767		—
Discontinued Operations:
Net interest accrued on make whole payment obligation to Loral	2,167		—
Receivable related to sale of affiliate interest	15,800		—
Supplemental Data:
Cash interest paid - continuing operations	645,679		542,844
Cash interest paid - discontinued operations	—		12
Income taxes paid, net	24,456		10,015

NOTE 7. RECENTLY ADOPTED ACCOUNTING STANDARDS

In December 2006, the Financial Accounting Standards Board (“FASB”) issued Staff Position No. EITF 00-19-2, Accounting for Registration Payment Arrangements (“FSP 00-19-2”).  FSP 00-19-2 provides guidance related to the accounting for registration payment arrangements and specifies that the contingent obligation to make future payments or otherwise transfer consideration under a registration payment arrangement, whether issued as a separate arrangement or included as a provision of a financial instrument or arrangement, should be separately recognized and measured in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 5, Accounting for Contingencies (“Statement No. 5”).  FSP 00-19-2 requires that if the transfer of consideration under a registration payment arrangement is probable and can be reasonably estimated at inception, the contingent liability under such arrangement shall be included in the allocation of proceeds from the related financing transaction using the measurement guidance in Statement No. 5.  FSP 00-19-2 applies immediately to any registration payment arrangement entered into subsequent to the issuance of FSP 00-19-2.  For such arrangements entered into prior to the issuance of FSP 00-19-2, the guidance was effective for the Company as of January 1, 2007.  As a condition to the initial sale of CSC Holdings’ 6-3/4% Senior Notes due 2012, the Company entered into a registration rights agreement with the initial purchasers under which the Company agreed that it would file an exchange offer registration statement under the Securities Act with the Securities and Exchange Commission (“SEC”) and use its commercially reasonable best efforts to cause the exchange offer registration statement to be declared effective under the Securities Act.  If the exchange offer was not completed by May 11, 2005, the agreement provided for an increase of 1/4% per annum in the interest rate for the first 90 days after May 11, 2005 and an additional 1/4% per annum, up to a maximum of 1/2%

34

per annum, at the beginning of each subsequent 90 day period that the exchange offer was not completed. Upon the completion of the exchange, the interest rate would revert to 6-3/4%.  In March 2007, the Company offered to exchange these notes for substantially identical publicly registered 6-3/4% Series B Senior Notes due 2012.  This exchange was completed on April 26, 2007.  In connection with the adoption of FSP 00-19-2 as of January 1, 2007, the Company recorded a charge of $443, net of tax, as a cumulative effect of a change in accounting principle representing the estimated fair value of the 1/2% penalty interest expected to be incurred under the registration rights agreement subsequent to January 1, 2007.

On January 1, 2007, the Company adopted FASB Interpretation No. (“FIN”) 48, Accounting for Uncertainty in Income Taxes - an interpretation of SFAS No. 109.  This Interpretation clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS No. 109, Accounting for Income Taxes.  FIN 48 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of an income tax position taken or expected to be taken in an income tax return.  The change in the net assets and liabilities recognized as a result of adopting the provisions of FIN 48 has been recorded as a charge of $442 to the opening balance of accumulated deficit.

In June 2006, the Emerging Issues Task Force reached a consensus on Issue No. 06-3, How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (That Is, Gross versus Net Presentation) (“EITF No. 06-3”), which addresses the income statement disclosures for taxes assessed by a governmental authority that is directly imposed on a revenue-producing transaction between a seller and a customer, and may include, but are not limited to, sales, use, value added, and some excise taxes.  The presentation of taxes on either a gross (included in revenues and costs) or a net (excluded from revenues) basis is an accounting policy decision that should be disclosed pursuant to Accounting Principles Board Opinion No. 22.  In addition, for any such taxes that are reported on a gross basis, a company should disclose the amounts of those taxes in interim and annual financial statements for each period for which an income statement is presented if those amounts are significant and can be done on an aggregate basis.  EITF No. 06-3 was effective January 1, 2007 for the Company.  For the three and nine months ended September 30, 2007 and 2006, the amount of franchise fees included as a component of net revenue aggregated $27,786 and $82,966, and $25,674 and $75,180, respectively.

NOTE 8.DISCONTINUED OPERATIONS AND NET ASSETS HELD FOR SALE

In June 2007, the Company completed the sale of its 60% interest in Fox Sports Net Bay Area to Comcast Corporation (“Comcast”) (see Note 17).  In addition, in June 2006 and April 2005, respectively, the operations of the Fox Sports Net Chicago programming business and the Rainbow DBS satellite distribution business were shut down.  As a result, the operating results of these businesses, net of taxes, have been classified in the condensed consolidated statements of operations as discontinued operations for all periods presented.  Operating results of discontinued operations for the three and nine months ended September 30, 2007 and 2006 are summarized below:

35

	Three Months Ended September 30, 2007
	Fox Sports Net Bay Area			Rainbow DBS distribution business			Total
Revenues, net	$	—		$	—		$	—
Loss before income taxes	$	(118	)	$	(628	)	$	(746	)
Income tax benefit	49			257			306
Net loss	$	(69	)	$	(371	)	$	(440	)

	Three Months Ended September 30, 2006
	Fox Sports Net Bay Area			Fox Sports Net Chicago (a)			Rainbow DBS distribution business			Total
Revenues, net	$	27,020		$	—		$	—		$	27,020
Income (loss) before income taxes	$	5,079		$	311		$	(1,025	)	$	4,365
Income tax benefit (expense)	(2,080		)	(127		)	420			(1,787		)
Net income (loss)	$	2,999		$	184		$	(605	)	$	2,578

	Nine Months Ended September 30, 2007
	Fox Sports Net Bay Area			Rainbow DBS distribution business			Total
Revenues, net	$	53,894		$	—		$	53,894
Income before income taxes, including gain on sale of Fox Sports Net Bay Area of $317,846	$	326,017		$	7,725		$	333,742
Income tax expense	(133,406		)	(3,161		)	(136,567		)
Net income, including gain on sale of Fox Sports Net Bay Area of $187,784, net of taxes	$	192,611		$	4,564		$	197,175

	Nine Months Ended September 30, 2006
	Fox Sports Net Bay Area			Fox Sports Net Chicago (a)			Rainbow DBS distribution business			Total
Revenues, net	$	75,844		$	78,974		$	—		$	154,818
Income (loss) before income taxes	$	11,807		$	72,601		$	(4,875	)	$	79,533
Income tax benefit (expense)	(4,835		)	(31,827		)	1,996			(34,666		)
Net income (loss)	$	6,972		$	40,774		$	(2,879	)	$	44,867

(a)Revenues, net includes $77,996 representing the collection in June 2006 of affiliate revenue from a cable affiliate, including $71,396 relating to periods prior to 2006, that had not been previously recognized due to a contractual dispute.  The underlying contract was terminated in June 2006 and no further payments will be received under this contract.

36

In March 2007, the Federal Communications Commission (“FCC”) waived the bond requirement previously submitted by Rainbow DBS Company LLC with respect to five Ka-band licenses.  These bonds were originally cash collateralized by the Company.  In connection with the shut down of the Rainbow DBS satellite distribution business in 2005, the Company recorded a loss related to the outstanding bonds since the Company believed it was not probable that Rainbow DBS would meet the required FCC milestones.  As a result of the waiver from the FCC, the Company recorded a gain of $6,638, net of taxes, in the quarter ended March 31, 2007.  The Company received the cash collateral of $11,250 in the quarter ended June 30, 2007.

The assets and liabilities of Fox Sports Net Bay Area have been classified in the consolidated balance sheet as of December 31, 2006 as assets and liabilities held for sale and consist of the following:

	December 31, 2006
Cash and cash equivalents	$	24,461
Accounts receivable, prepaid expenses and other current assets	24,728
Property and equipment, net and other long-term assets	15,950
Intangible assets, net	63,162
Total assets held for sale	$	128,301
Accounts payable and accrued expenses	$	5,059
Other current liabilities	965
Other long-term liabilities	19
Total liabilities held for sale	$	6,043

37

NOTE 9.INTANGIBLE ASSETS

The following table summarizes information relating to the Company’s acquired intangible assets at September 30, 2007 and December 31, 2006:

	September 30, 2007		December 31, 2006
Gross carrying amount of amortizable intangible assets
Affiliation relationships and affiliate agreements	$	742,416	$	742,416
Broadcast rights and other agreements	45,590		45,590
Season ticket holder relationships	75,005		75,005
Suite holder contracts and relationships	21,167		21,167
Advertiser relationships	103,524		103,524
Other intangibles	43,933		40,819
	1,031,635		1,028,521
Accumulated amortization
Affiliation relationships and affiliate agreements	395,842		353,518
Broadcast rights and other agreements	38,143		36,806
Season ticket holder relationships	14,115		10,027
Suite holder contracts and relationships	8,306		5,815
Advertiser relationships	50,875		42,274
Other intangibles	22,769		19,139
	530,050		467,579
Indefinite-lived intangible assets
Cable television franchises	731,848		731,848
Sports franchises	96,215		96,215
FCC licenses and other intangibles	11,936		11,936
Trademarks	53,880		53,880
Excess costs over the fair value of net assets acquired	1,023,860		1,024,168
	1,917,739		1,918,047
Total intangible assets, net	$	2,419,324	$	2,478,989
Aggregate amortization expense
Nine months ended September 30, 2007 and year ended December 31, 2006 (excluding impairment charges of $899 for the year ended December 31, 2006)	$	62,630	$	84,803
Estimated amortization expense
Year ending December 31, 2007	$	83,238
Year ending December 31, 2008	81,064
Year ending December 31, 2009	74,655
Year ending December 31, 2010	71,649
Year ending December 31, 2011	70,901

38

NOTE 10.DEBT

On July 24, 2007, Rainbow National Services LLC (“RNS”), an indirect wholly-owned subsidiary of Cablevision entered into an equity commitment agreement with its sole member, Rainbow Programming Holdings LLC (“RPH”), an indirect wholly-owned subsidiary of Rainbow Media Holdings, pursuant to which RPH agreed to purchase additional membership interests in RNS for an aggregate purchase price of $203,000.  RNS used the proceeds of the investment by RPH to redeem $175,000 in aggregate principal amount of its 10-3/8% senior subordinated notes due 2014, representing 35% of the outstanding notes, at a redemption price equal to 110.375% of the principal amount of the notes plus accrued and unpaid interest to August 31, 2007, the redemption date.  In connection with the redemption, the Company recognized a loss on extinguishment of debt of $19,113, representing primarily the redemption premium, and the write-off of the related unamortized deferred financing costs of $2,919.

NOTE 11.COLLATERALIZED INDEBTEDNESS

The following table summarizes the settlement of the Company’s collateralized indebtedness for the nine months ended September 30, 2007.  The Company’s collateralized indebtedness obligations relating to shares of Charter Communications, Inc. and Leapfrog Enterprises, Inc. were settled by delivering the underlying securities and the related equity derivative contracts.

	Charter			Leapfrog			Total
Number of shares	3,724,460			800,000
Collateralized indebtedness settled	$	(83,231	)	$	(19,238	)	$	(102,469	)
Prepaid forward contracts	70,903			10,638			81,541
Fair value of underlying securities delivered	12,328			8,600			20,928
Net cash payment	$	—		$	—		$	—

At September 30, 2007, the Company had collateralized indebtedness obligations of $172,822 that will mature during the next twelve months.  The Company intends to settle such obligations either by delivering shares of the applicable stock and the related equity derivative contracts or by delivering cash from the net proceeds of a new monetization transaction.  In the event of an early termination of any of these contracts, the Company would be expected to pay the counterparty an amount approximately equal to the fair value of the collateralized indebtedness less the sum of the fair values of the underlying stock and equity collar, calculated on or near the termination date.

NOTE 12.INCOME TAXES

The income tax expense attributable to continuing operations for the nine months ended September 30, 2007 of $75,493 differs from the income tax expense derived from applying the statutory federal rate to pretax income due principally to state taxes, tax expense of $5,027, including accrued interest, recorded pursuant to FIN 48, tax expense of $1,468 resulting from a change in the deferred tax rate, and the tax impact of non-deductible officers’ compensation and other non-deductible expenses of $7,314 and $4,436, respectively, partially offset by a decrease in the valuation allowance of $1,303 relating to certain state net operating loss carry forwards.

The income tax benefit attributable to continuing operations for the nine months ended September 30, 2006 of $97,435 differs from the income tax benefit derived from applying the statutory federal rate to the pretax loss due principally to state taxes, a decrease in the valuation allowance of $5,414 relating to

39

certain state net operating loss carry forwards, a tax benefit of $5,013 resulting from the favorable settlement of an issue with a taxing authority, and a tax benefit of $16,356 resulting from the reduction of a tax contingency liability, partially offset by the tax impact of non-deductible officers’ compensation and other non-deductible expenses of $3,951 and $4,780, respectively.

In general, the Company is required to use an estimated annual effective tax rate to measure the tax benefit or tax expense recognized in an interim period.  The estimated annual effective tax rate is revised on a quarterly basis and therefore may be different from the rate used for a prior interim period.  The income tax benefit for the three months ended September 30, 2007 is equal to the difference between the income tax provision for the six month and nine month periods ended June 30, 2007 and September 30, 2007.

In connection with the tax allocation policy between the Company and Cablevision, the Company has recorded a payable due to Cablevision and Cablevision has recorded a receivable due from the Company, both in the amount of $12,659, representing the estimated federal income tax liability of the Company for the nine months ended September 30, 2007 as determined on a stand-alone basis as if the Company filed separate federal consolidated income tax returns.

Deferred tax assets have resulted primarily from the Company’s future deductible temporary differences and net operating loss carry forwards.  In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax asset will not be realized.  The Company’s ability to realize its deferred tax assets depends upon the generation of sufficient future taxable income and tax planning strategies to allow for the utilization of its net operating loss carry forwards and deductible temporary differences.  If such estimates and related assumptions change in the future, the Company may be required to record additional valuation allowances against certain of its deferred tax assets resulting in additional income tax expense in the Company’s consolidated statement of operations.  Management evaluates the realizability of the deferred tax assets and the need for additional valuation allowances quarterly.  Management believes that it is more likely than not that the Company will realize benefit for its gross deferred tax assets, except for certain of its deferred tax assets against which a valuation allowance has been recorded relating to certain state net operating loss carry forwards.

The Company takes certain positions on its tax returns that may be challenged by various taxing authorities.  These tax positions arise in connection with certain transactions or operations.

The Company adopted the provisions of FIN 48 on January 1, 2007.  The cumulative effect of applying the provisions of FIN 48 resulted in a charge of $442 to the opening balance of the accumulated deficit.

As of January 1, 2007, the Company had a gross liability of $10,353 for uncertain income tax positions, excluding accrued interest.  After considering associated deferred tax benefits of $3,353, the net amount of liability for uncertain tax positions was $7,000 as of January 1, 2007.  Therefore, if all uncertain tax positions were sustained at the amounts reported or expected to be reported in the Company’s tax returns, the Company’s income tax expense would decrease by $7,000.

Interest expense related to income tax liabilities recognized in accordance with the provisions of FIN 48 is included in income tax expense, consistent with the Company’s historical policy.  Interest expense of $1,875 and the associated deferred tax benefit of $767 have been recognized in the nine month period ended September 30, 2007 and are included in income tax expense in the Company’s condensed

40

consolidated statement of operations.  At January 1, 2007, accrued interest on uncertain tax positions was $2,617 and was included in other current liabilities in the consolidated balance sheet.

As of January 1, 2007, the Company had a liability recorded with regard to the Ohio income tax audit for the year ended December 31, 2000 of $10,937, including accrued interest.  During the three month period ended March 31, 2007, the liability, including accrued interest, was increased by $3,327, to $14,264, resulting in additional income tax expense in the Company’s condensed consolidated statement of operations.  Such amount excludes the associated deferred tax benefit.  In April 2007, the Company and representatives from the Ohio Department of Taxation agreed to settle the Ohio income tax audit for the tax year ended December 31, 2000 for $18,000, inclusive of interest.  Therefore, the Company recognized additional income tax expense of $3,736, excluding deferred tax benefit, in the three month period ended June 30, 2007.

As of September 30, 2007, the Company had a liability of $1,963 for uncertain income tax positions, excluding accrued interest, net of deferred tax benefits of $640.

In July 2007, the Internal Revenue Service (“IRS”) completed its audit of the Company’s consolidated federal income tax returns for 2002 and 2003.  The completion of this audit did not have a significant effect on the Company’s consolidated financial statements.  In October 2007, the IRS began an audit of the Company’s consolidated federal income tax returns for 2004 and 2005.

With a few exceptions, the Company is no longer subject to state and local income tax audits by taxing authorities for years prior to 2003.  The most significant jurisdictions in which the Company is required to file income tax returns include the state of New York, New Jersey and Connecticut and the city of New York.  In September 2007, the state of New York started an audit of 2003 through 2005.

Management does not believe that the resolution of the ongoing income tax examinations described above will have a material adverse impact on the financial position of the Company.  Changes in the liabilities for uncertain tax positions will be recognized in the interim period in which the positions are effectively settled or there is a change in factual circumstances.

41

NOTE 13.BENEFIT PLANS

Components of the net periodic pension cost, recorded primarily in selling, general and administrative expenses, for the Company’s qualified and non-qualified defined benefit and other postretirement plans for the three and nine months ended September 30, 2007 and 2006, are as follows:

	Cablevision Qualified and Non–qualified Defined Benefit Plans						Madison Square Garden Qualified and Non–qualified Defined Benefit Plans						Madison Square Garden Postretirement Benefit Plan
	Three Months Ended September 30,
	2007			2006			2007			2006			2007			2006
Service cost	$	7,904		$	7,345		$	1,201		$	1,247		$	91		$	99
Interest cost	2,510			2,053			1,480			1,360			95			90
Expected return on plan assets	(2,957		)	(2,470		)	(1,219		)	(921		)	––			––
Recognized prior service cost (credit)	––			3			6			6			(33		)	(33		)
Recognized actuarial (gain) loss	––			––			37			157			(3		)	(1		)
Recognized transition asset	––			––			(1		)	(1		)	––			––
Net periodic benefit cost	$	7,457		$	6,931		$	1,504		$	1,848		$	150		$	155

	Cablevision Qualified and Non-qualified Defined Benefit Plans						Madison Square Garden Qualified and Non-qualified Defined Benefit Plans						Madison Square Garden Postretirement Benefit Plan
	Nine Months Ended September 30,
	2007			2006			2007			2006			2007			2006
Service cost	$	23,711		$	22,034		$	3,604		$	3,741		$	275		$	299
Interest cost	7,530			6,159			4,439			4,081			285			271
Expected return on plan assets	(8,809		)	(7,411		)	(3,427		)	(2,764		)	––			––
Recognized prior service cost (credit)	––			9			19			19			(100		)	(100		)
Recognized actuarial (gain) loss	––			––			84			470			(8		)	(3		)
Recognized transition asset	––			––			(2		)	(2		)	––			––
Net periodic benefit cost	$	22,432		$	20,791		$	4,717		$	5,545		$	452		$	467

42

For the nine months ended September 30, 2007, the Company contributed $11,967 to the Madison Square Garden Qualified Defined Benefit Plans (the “MSG Qualified Plans”), $28,200 to the Cablevision Cash Balance Retirement Plan and currently does not expect to make any additional contributions to either the Cablevision Cash Balance Retirement Plan or the MSG Qualified Plans for the remainder of 2007.

NOTE 14.LEGAL MATTERS

Tracking Stock Litigation

In August 2002, purported class actions naming as defendants Cablevision and each of its directors were filed in the Delaware Chancery Court.  The actions, which allege breach of fiduciary duties and breach of contract with respect to the exchange of the Rainbow Media Group tracking stock for Cablevision NY Group common stock, were purportedly brought on behalf of all holders of publicly traded shares of Rainbow Media Group tracking stock.  The actions sought to (i) enjoin the exchange of Rainbow Media Group tracking stock for Cablevision NY Group common stock, (ii) enjoin any sales of “Rainbow Media Group assets,” or, in the alternative, award rescissory damages, (iii) if the exchange is completed, rescind it or award rescissory damages, (iv) award compensatory damages, and (v) award costs and disbursements.  The actions were consolidated into one action on September 17, 2002, and on October 3, 2002, Cablevision filed a motion to dismiss the consolidated action.  The action was stayed by agreement of the parties pending resolution of a related action brought by one of the plaintiffs to compel the inspection of certain books and records of Cablevision.  On October 26, 2004, the parties entered into a stipulation dismissing the related action, and providing for Cablevision’s production of certain documents. On December 13, 2004, plaintiffs filed a consolidated amended complaint.  Cablevision filed a motion to dismiss the amended complaint.  On April 19, 2005, the court granted that motion in part, dismissing the breach of contract claim but declining to dismiss the breach of fiduciary duty claim on the pleadings.

In August 2003, a purported class action naming as defendants Cablevision, directors and officers of Cablevision and certain current and former officers and employees of the Company’s Rainbow Media Holdings and American Movie Classics subsidiaries was filed in New York Supreme Court by the Teachers Retirement System of Louisiana (“TRSL”).  The actions relate to the August 2002 Rainbow Media Group tracking stock exchange and allege, among other things, that the exchange ratio was based upon a price of the Rainbow Media Group tracking stock that was artificially deflated as a result of the improper recognition of certain expenses at the national services division of Rainbow Media Holdings.  The complaint alleges breaches by the individual defendants of fiduciary duties.  The complaint also alleges breaches of contract and unjust enrichment by Cablevision.  The complaint seeks monetary damages and such other relief as the court deems just and proper.  On October 31, 2003, Cablevision and other defendants moved to stay the action in favor of the previously filed actions pending in Delaware or, in the alternative, to dismiss for failure to state a claim.  On June 10, 2004, the court stayed the action on the basis of the previously filed action in Delaware.  TRSL subsequently filed a motion to vacate the stay in the New York action, and simultaneously filed a motion to intervene in the Delaware action and to stay that action.  Cablevision opposed both motions.  On April 19, 2005, the court in the Delaware action denied the motion to stay the Delaware action and granted TRSL’s motion to intervene in that action.  On June 22, 2005, the court in the New York action denied TRSL’s motion to vacate the stay in that action.

Cablevision reached an agreement in principle with respect to the settlement of the Delaware action in the quarter ended June 30, 2007.  In connection with the anticipated settlement, Cablevision expects to seek dismissal of the New York action as well as the Delaware action.

43

The Wiz Bankruptcy

TW, Inc. (“TW”), a former subsidiary of the Company and operator of The Wiz consumer retail electronics business, is the subject of a Chapter 11 bankruptcy proceeding in the U.S. Bankruptcy Court for the District of Delaware.  In February 2005, TW filed a complaint in the bankruptcy proceeding against Cablevision and certain of its affiliates seeking recovery of alleged preferential transfers in the aggregate amount of $193,457.  Also in February 2005, the Official Committee of Unsecured Creditors of TW (the “Committee”) filed a motion seeking authority to assume the prosecution of TW’s alleged preference claims and to prosecute certain other causes of action.  The bankruptcy court granted the Committee’s motion on or about March 10, 2005, thereby authorizing the Committee, on behalf of TW, to continue the preference suit and to assert other claims.  On March 12, 2005, the Committee filed a complaint in the bankruptcy court against Cablevision, certain of its affiliates, and certain present and former officers and directors of Cablevision and of its former subsidiary Cablevision Electronics Investments, Inc. (“CEI”).  The Committee’s complaint, as amended, asserts preferential transfer claims allegedly totaling $193,858, breach of contract, promissory estoppel, and misrepresentation claims allegedly totaling $310,000, and fraudulent conveyance, breach of fiduciary duty, and other claims seeking unspecified damages.  On June 30, 2005, the defendants filed a motion to dismiss several of the claims in the amended complaint.  On October 31, 2005, the bankruptcy court denied the motion to dismiss.  The bankruptcy court’s ruling on the motion to dismiss allowed the Committee to proceed with its claims against Cablevision and the other defendants.  Cablevision believes that the claims asserted by the Committee are without merit and is contesting them vigorously.

Dolan Family Group 2006 Proposal

In October 2006, a number of shareholder class action lawsuits (the “Transactions Lawsuits”) were filed against Cablevision and its individual directors in New York Supreme Court, Nassau County, relating to the October 8, 2006 offer by the Dolan Family Group to acquire all of the outstanding shares of Cablevision’s common stock, except for the shares held by the Dolan Family Group.  These lawsuits allege breaches of fiduciary duty and seek injunctive relief to prevent consummation of the proposed transaction and compensatory damages.  (In addition, a similar claim was added to a shareholder derivative action involving claims for alleged options backdating that was pending in the District Court for the Eastern District of New York, which is described below under “Stock Option Related Matters.”)  The New York Supreme Court ordered expedited discovery, which began in November 2006.  On January 12, 2007, the Special Transaction Committee of the Board (“Special Transaction Committee”) received a revised proposal from the Dolan Family Group to acquire all of the outstanding shares of common stock of Cablevision, except for the shares held by the Dolan Family Group.  On January 16, 2007, the Special Transaction Committee delivered a letter to Charles F. Dolan and James L. Dolan, rejecting as inadequate the revised proposal.  As discussed in Note 18, on May 2, 2007, Cablevision entered into a merger agreement pursuant to which, if the merger contemplated thereby was consummated, the Dolan Family Group would obtain ownership of all of the common stock equity of Cablevision (the “Proposed Merger”).  Lawyers representing shareholders in certain of the Transactions Lawsuits, in consultation with lead counsel for the plaintiffs in the Nassau County Supreme Court options backdating litigations, participated in the negotiations to improve the financial terms of the Proposed Merger as well as to add certain contractual provisions designed to protect the rights of shareholders. Based upon the above events and circumstances, and the role that the lead counsel for the plaintiffs in the Transactions Lawsuits played in connection with the Proposed Merger, the parties subsequently reached a memorandum of understanding for the dismissal of the Transactions Lawsuits (and of the going-private claim in the cases pending in the U.S. District Court for the Eastern District of New York), subject to

44

approval of a settlement by the Nassau County Supreme Court, and for the transfer to Cablevision, if the Proposed Merger were to be consummated, of the options-related derivative claims pending in the Nassau County Supreme Court and in the U.S. District Court for the Eastern District of New York.  Pursuant to the memorandum of understanding, the parties executed a stipulation of settlement as of September 18, 2007.  The stipulation of settlement was conditioned on, among other things, consummation of the Proposed Merger, and provided that the stipulation would become null and void and of no further force and effect in the event that this condition was not satisfied.  This condition was not satisfied.

Director Litigation

Cablevision was named as a nominal defendant in a purported shareholder derivative complaint filed in the Court of Chancery of the State of Delaware.  The action was brought derivatively on behalf of Cablevision and named as additional defendants Charles F. Dolan, the Chairman of Cablevision, and Rand Araskog, Frank Biondi, John Malone and Leonard Tow, each of whom was appointed as a director on March 2, 2005 by Mr. Dolan and certain other holders of the Company’s NY Group Class B common stock.  The complaint alleges that Charles F. Dolan, as the controlling Class B shareholder of Cablevision, by purporting to remove three Cablevision Board members (William J. Bell, Sheila Mahony and Steven Rattner) and replace them with the four new directors, wrongfully interfered with the Board’s role in managing the affairs of Cablevision and sought to substitute his judgment of how to proceed with the VOOM service of Cablevision’s Rainbow DBS subsidiary above that of the Board.  The action seeks, among other things, to preliminarily and permanently enjoin Charles F. Dolan from interfering with the managerial prerogatives of Cablevision’s Board; rescinding the purported appointment of the new directors; rescinding the removal of Mr. Bell, Ms. Mahony and Mr. Rattner as directors and restoring them to their positions as directors and directing Charles F. Dolan to account to Cablevision for its damages.  There have been no developments in the case since May 2005, when the parties agreed that defendants need not respond to the complaint until further notice from the plaintiff.

Patent Litigation

Cablevision is named as a defendant in certain lawsuits claiming infringement of various patents relating to various aspects of our businesses.  In certain of these cases other industry participants are also defendants.  In certain of these cases we expect that any potential liability would be the responsibility of our equipment vendors pursuant to applicable contractual indemnification provisions.  To the extent that the allegations in these lawsuits have been analyzed by us at the current stage of their proceedings, we believe that the claims are without merit and intend to defend the actions vigorously.  The final disposition of these actions is not expected to have a material adverse effect on our consolidated financial position.

Contract Dispute

In September 2005, Loral filed an action against Cablevision and Rainbow DBS for breach of contract based on a letter agreement dated March 23, 2001 (“the Letter Agreement”) between Loral and Rainbow DBS.  Loral alleges that the sale of the Rainbow-1 satellite and related assets to EchoStar constituted a sale of “substantially all of the assets of Rainbow DBS” triggering a “Make Whole Payment” under the Letter Agreement of $33,000 plus interest.  A trial in this matter took place in January 2007 in New York Supreme Court for New York County.  On January 24, 2007, the jury returned a verdict finding that the EchoStar sale had triggered a Make Whole Payment under the Letter Agreement, requiring a payment to Loral of $50,898, including interest, which was accrued for as of December 31, 2006 and reflected as an

45

expense in discontinued operations.  On March 12, 2007, judgment was entered against Cablevision and Rainbow DBS in the amount of $52,159.  Cablevision and Rainbow DBS filed a motion for judgment as a matter of law, or in the alternative for a new trial, which was denied by the court on March 30, 2007.  The Company has posted a cash collateralized bond in the amount of $52,159, which is reflected as restricted cash in the Company’s condensed consolidated balance sheet at September 30, 2007, and the Company is in the process of appealing the judgment.

Accounting Related Investigations

The improper expense recognition matter previously reported by the Company has been the subject of investigations by the SEC and the U.S. Attorney’s Office for the Eastern District of New York.  The SEC is continuing to investigate the improper expense recognition matter and the Company’s timing of recognition of launch support, marketing and other payments under affiliation agreements.  The Company continues to fully cooperate with such investigations.

Stock Option Related Matters

The Company announced on August 8, 2006 that, based on a voluntary review of its past practices in connection with grants of stock options and stock appreciation rights (“SARs”), it had determined that the grant date and exercise price assigned to a number of its stock option and SAR grants during the 1997-2002 period did not correspond to the actual grant date and the fair market value of Cablevision’s common stock on the actual grant date.  The review was conducted with a law firm that was not previously involved with the Company’s stock option plans.  The Company has advised the SEC and the U.S. Attorney’s Office for the Eastern District of New York of these matters and each has commenced an investigation.  The Company received a grand jury subpoena from the U.S. Attorney’s Office for the Eastern District of New York seeking documents related to the stock options issues.  The Company received a document request from the SEC relating to its informal investigation into these matters.  The Company continues to fully cooperate with such investigations.

In addition, in August, September and October 2006, purported derivative lawsuits (including one purported combined derivative and class action lawsuit) relating to the Company’s past stock option and SAR grants were filed in New York State Supreme Court for Nassau County, the United States District Court for the Eastern District of New York, and Delaware Chancery Court for New Castle County, by parties identifying themselves as shareholders of Cablevision purporting to act on behalf of Cablevision.  These lawsuits named as defendants certain present and former members of Cablevision’s Board of Directors and certain present and former executive officers, alleging breaches of fiduciary duty and unjust enrichment relating to practices with respect to the dating of stock options, recordation and accounting for stock options, financial statements and SEC filings, and alleged violation of IRC 162(m).  In addition, certain of these lawsuits asserted claims under Sections 10(b), 14(a), and 20(a) of the Securities Exchange Act of 1934 and Section 304 of the Sarbanes-Oxley Act.  The lawsuits sought damages from all defendants, disgorgement from the officer defendants, declaratory relief, and equitable relief, including rescission of the 2006 Employee Stock Plan and voiding of the election of the director defendants.  On October 27, 2006, the Board of Directors of Cablevision appointed Grover C. Brown and Zachary W. Carter as directors and, on the same date, appointed Messrs. Brown and Carter to a newly formed special litigation committee (“SLC”) of the Board.  The SLC was directed by the Board to review and analyze the facts and circumstances surrounding these claims, which purport to have been brought derivatively on behalf of the Company, and to consider and determine whether or not prosecution of such claims is in the best interests of the Company and its shareholders, and what actions the Company should take with

46

respect to the cases.  The SLC, through its counsel, filed motions in all three courts to intervene and to stay all proceedings until completion of the SLC’s independent investigation of the claims raised in these actions.  The Delaware action subsequently was voluntarily dismissed without prejudice by the plaintiff.  The actions pending in Nassau County have been consolidated and a single amended complaint has been filed in that jurisdiction. Similarly, the actions pending in the Eastern District of New York have been consolidated and a single amended complaint has been filed in that jurisdiction.  Both the Nassau County action and the Eastern District of New York action assert derivative claims on behalf of the Company as well as direct claims on behalf of Cablevision shareholders relating to the Company’s past stock option and SAR grants.  On November 14, 2006, the trial court in the Nassau County action denied the SLC’s motion for a stay of proceedings and ordered expedited discovery.  The Appellate Division of the New York State Supreme Court subsequently stayed all proceedings in the Nassau County action (including all discovery) pending the SLC’s appeal of the denial of its stay motion.  On October 9, 2007, the Appellate Division affirmed the trial court’s denial of the SLC’s motion to stay proceedings. The U.S. District Court for the Eastern District of New York granted the SLC’s motion for a stay and stayed the cases pending in that court until June 12, 2007.  On June 12, 2007, the SLC requested an extension of the stay until either the closing of the Proposed Merger or 30 days after it is determined that the transaction will not close.  On June 26, 2007, the court granted the requested extension of the stay.

As discussed in Note 18, on May 2, 2007, Cablevision entered into a merger agreement pursuant to which the Dolan Family Group would obtain ownership of all of the common stock equity of Cablevision in the Proposed Merger.  Included in the $36.26 per share merger consideration that would have been provided to shareholders in the Proposed Merger was merger consideration payable in exchange for the surviving corporation’s succeeding to Cablevision’s and shareholders’ rights in connection with claims involving alleged options backdating.  As discussed above (under “Dolan Family Group 2006 Proposal”), the stipulation of settlement providing for the succession of those claims was conditioned on, among other things, consummation of the Proposed Merger.  This condition was not satisfied.

We have continued to incur substantial expenses for legal services in connection with the Company’s stock option related litigation and the investigations by the SEC and the U.S. Attorney’s Office for the Eastern District of New York.

Other Matters

In addition to the matters discussed above, the Company is party to various lawsuits, some involving claims for substantial damages.  Although the outcome of these other matters cannot be predicted with certainty and the impact of the final resolution of these other matters on the Company’s results of operations in a particular subsequent reporting period is not known, management does not believe that the resolution of these other lawsuits will have a material adverse effect on the financial position of the Company or the ability of the Company to meet its financial obligations as they become due.

NOTE 15.SEGMENT INFORMATION

The Company classifies its business interests into three reportable segments:  Telecommunications Services, consisting principally of its video, high-speed data, Voice over Internet Protocol and its commercial data and voice services operations; Rainbow, consisting principally of interests in national and regional television programming networks, including AMC, IFC, WE tv, fuse, News 12 and the VOOM HD Networks; and Madison Square Garden, which owns and operates professional sports teams, regional television sports programming networks and an entertainment business.

47

The Company’s reportable segments are strategic business units that are managed separately.  The Company evaluates segment performance based on several factors, of which the primary financial measure is business segment adjusted operating cash flow (defined as operating income (loss) before depreciation and amortization (including impairments), share-based compensation expense or benefit and restructuring charges or credits), a non-GAAP measure.  The Company has presented the components that reconcile adjusted operating cash flow to operating income (loss), an accepted GAAP measure.  Information as to the operations of the Company’s business segments is set forth below.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Revenues, net from continuing operations
Telecommunications Services	$	1,179,471		$	1,075,754		$	3,503,598		$	3,118,087
Rainbow	221,751			190,022			650,516			573,490
Madison Square Garden	130,259			128,516			548,191			514,402
All other (a)	21,089			21,249			55,725			59,476
Intersegment eliminations	(40,771		)	(33,825		)	(115,614		)	(99,282		)
	$	1,511,799		$	1,381,716		$	4,642,416		$	4,166,173

Intersegment eliminations are primarily affiliate revenues recognized by our Rainbow and MSG segments from the sale of cable network programming to our Telecommunication Services segment.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Intersegment Revenues
Telecommunications Services	$	388	$	411	$	1,225	$	1,247
Rainbow	14,513		9,765		36,104		27,644
Madison Square Garden	25,870		23,649		78,285		70,391
	$	40,771	$	33,825	$	115,614	$	99,282

Reconciliation (by Segment and in Total) of Adjusted Operating Cash Flow to Operating Income (Loss) from Continuing Operations

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Adjusted operating cash flow from continuing operations
Telecommunications Services	$	446,524		$	411,544		$	1,330,871		$	1,232,281
Rainbow	51,912			36,697			132,943			81,186
Madison Square Garden	10,238			(6,093		)	60,367			18,788
All other (b)	(14,392		)	(14,142		)	(47,662		)	(53,248		)
	$	494,282		$	428,006		$	1,476,519		$	1,279,007

48

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Depreciation and amortization (including impairments) included in continuing operations
Telecommunications Services	$	233,100	$	233,871	$	700,917	$	686,506
Rainbow	22,992		24,709		69,881		73,307
Madison Square Garden	14,124		15,616		43,645		46,271
All other (b)	9,983		11,011		29,054		34,698
	$	280,199	$	285,207	$	843,497	$	840,782

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Share-based compensation expense included in continuing operations
Telecommunications Services	$	5,374	$	9,154	$	23,079	$	27,784
Rainbow	2,957		5,211		15,792		17,689
Madison Square Garden	2,300		2,846		9,724		9,757
All other (b)	277		345		1,090		1,338
	$	10,908	$	17,556	$	49,685	$	56,568

	Three Months Ended September 30,					Nine Months Ended September 30,
	2007		2006			2007		2006
Restructuring charges (credits) included in continuing operations
Telecommunications Services	$	—	$	—		$	—	$	(17	)
Rainbow	971		––			2,496		143
Madison Square Garden	––		––			––		––
All other (b)	136		(1,729		)	66		(4,609		)
	$	1,107	$	(1,729	)	$	2,562	$	(4,483	)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Operating income (loss) from continuing operations
Telecommunications Services	$	208,050		$	168,519		$	606,875		$	518,008
Rainbow	24,992			6,777			44,774			(9,953		)
Madison Square Garden	(6,186		)	(24,555		)	6,998			(37,240		)
All other (b)	(24,788		)	(23,769		)	(77,872		)	(84,675		)
	$	202,068		$	126,972		$	580,775		$	386,140

49

A reconciliation of reportable segment amounts to the Company’s consolidated balances is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Income (loss) from continuing operations before income taxes
Total operating income for reportable segments	$	226,856		$	150,741		$	658,647		$	470,815
Other operating loss (b)	(24,788		)	(23,769		)	(77,872		)	(84,675		)
Operating income	202,068			126,972			580,775			386,140
Items excluded from operating income:
Interest expense	(203,733		)	(209,891		)	(613,422		)	(587,134		)
Interest income	12,784			4,559			25,176			26,452
Equity in net income of affiliates	––			2,677			4,377			5,872
Gain (loss) on sale of affiliate interests	(618		)	––			183,270			––
Gain (loss) on investments, net	(46,136		)	100,518			(31,505		)	178,594
Gain (loss) on derivative contracts, net	1,185			(130,019		)	37,087			(172,634		)
Write-off of deferred financing costs	(2,919		)	(6,084		)	(2,919		)	(14,083		)
Loss on extinguishment of debt	(19,113		)	––			(19,113		)	(13,125		)
Minority interests	(401		)	381			814			1,279
Miscellaneous, net	457			2,256			1,908			2,283
Income (loss) from continuing operations before income taxes	$	(56,426	)	$	(108,631	)	$	166,448		$	(186,356	)

(a)Represents net revenues of Clearview Cinemas and PVI Virtual Media.

(b)Principally includes unallocated corporate general and administrative costs, in addition to the operating results of Clearview Cinemas and PVI Virtual Media.  The 2007 and 2006 periods also include costs allocated to Fox Sports Net Bay Area that were not eliminated as a result of the sale of that business.  The 2006 periods also include costs allocated to Fox Sports Net Chicago that were not eliminated as a result of the shut down of that business.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2007		2006		2007		2006
Capital Expenditures
Telecommunications Services	$	202,713	$	194,037	$	515,098	$	662,560
Rainbow	6,277		6,440		12,173		11,558
Madison Square Garden	9,469		6,137		15,594		12,511
Corporate and other	2,747		4,918		11,506		13,248
	$	221,206	$	211,532	$	554,371	$	699,877

Substantially all revenues and assets of the Company’s reportable segments are attributed to or located in the United States primarily concentrated in the New York metropolitan area.

Concentrations of Credit Risk

Financial instruments that may potentially subject the Company to a concentration of credit risk consist primarily of cash and cash equivalents and trade receivables.  Cash is invested in money market funds and bank time deposits.  The Company’s cash investments are placed with money market funds or financial institutions that have received the highest rating awarded by Standard & Poor’s and Moody’s Investors Service.  The Company selects money market funds that predominately invest in marketable, direct obligations issued or guaranteed by the United States government or its agencies, commercial paper, fully

50

collateralized repurchase agreements, certificates of deposit, banker’s acceptances and time deposits.  The Company did not have any customers that accounted for 10% or more of the Company’s consolidated net trade receivable balances or 10% or more of the Company’s consolidated net revenues at or for the nine months ended September 30, 2007.

NOTE 16.INCENTIVE PLANS

Pursuant to Cablevision’s Cash Incentive Plan, the prior Long-Term Incentive Plan and Executive Performance Incentive Plan, executive officers and other members of management have been granted cash awards, some of which are time-based and some of which are both time-based and performance-based, that vest over varying required service periods and are typically payable at the end of the vesting period or on specified dates.

In connection with all long-term incentive awards granted under the Company’s Long-Term Incentive plans, the Company has recorded expense of $18,605 and $55,090, for the three and nine months ended September 30, 2007, respectively, and $14,433 and $44,376 for the three and nine month periods ended September 30, 2006, respectively.  At September 30, 2007 and December 31, 2006, the Company had accrued $91,426 and $51,905, respectively, for its performance-based cash awards for which the performance criteria had not been satisfied as of September 30, 2007, as such awards are based on achievement of certain performance criteria through various dates ending on December 31, 2009.  The Company has accrued approximately $49,867 in connection with its 2005 Long-Term Incentive Award through September 30, 2007.  The performance targets for this award run through December 31, 2007.

Cablevision currently believes that it is probable that each of its performance-based awards will ultimately be paid.  However, if Cablevision subsequently determines that it is probable that such awards will not be paid, the Company would reverse the related accrual in respect of such award in the period such determination is made.

NOTE 17.TRANSACTIONS

Sale of Fox Sports Net Bay Area and Fox Sports Net New England

In June 2007, Rainbow Media Holdings completed its sale to Comcast of (i) its 60% interest in Fox Sports Net Bay Area, for a purchase price of $366,750 (the “Bay Area Sale”) and (ii) its 50% interest in Fox Sports Net New England, for a purchase price of $203,250 (the “New England Sale”), for an aggregate purchase price of $570,000, plus certain additional consideration to Rainbow Media Holdings, subject to customary working capital adjustments.

The Company recorded a pretax gain of $183,270 ($108,276, net of taxes) in connection with the New England Sale and a pretax gain of $317,846 ($187,784, net of taxes), relating to the Bay Area Sale.  The net operating results of Fox Sports Net Bay Area have been classified as discontinued operations for all periods presented.  The net operating results of Fox Sports Net Bay Area were previously reported in the Rainbow segment.

Contemporaneously with the execution of the agreement relating to the Bay Area Sale and the New England Sale, subsidiaries of the Company and Comcast entered into or extended affiliation agreements relating to (i) the carriage of the Versus and Golf Channel programming services on the Company’s cable television systems and (ii) the carriage of AMC, fuse, IFC, WE tv, Lifeskool, sportskool, MSG and Fox Sports Net New York on Comcast’s cable television systems.

51

NOTE 18.DOLAN FAMILY GROUP TRANSACTION

On May 2, 2007, Cablevision entered into a merger agreement with Central Park Holding Company, LLC (“Dolan Family Acquisition Company”), an entity owned by the Dolan Family Group, and Central Park Merger Sub, Inc.  The terms of the merger agreement provided that Central Park Merger Sub, Inc. would be merged with and into Cablevision and, as a result, Cablevision would continue as the surviving corporation and a wholly-owned subsidiary of Dolan Family Acquisition Company (the “Proposed Merger”).

On October 24, 2007, the Proposed Merger was submitted to a vote of Cablevision’s shareholders and did not receive shareholder approval.  Subsequently, the parties terminated the merger agreement pursuant to its terms.

52

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

All dollar amounts, except per subscriber, per unit and per share data, included in the following discussion under this Item 2 are presented in thousands.

Summary

Our future performance is dependent, to a large extent, on general economic conditions including capital market conditions, the impact of competition, our ability to manage our businesses effectively, and our relative strength and leverage in the marketplace, both with suppliers and customers.

Telecommunications Services

Our Telecommunications Services segment derives revenues principally through monthly charges to subscribers of our video, high-speed data and voice services.  These monthly charges include fees for cable television programming, as well as, in many cases, equipment rental, pay-per-view and video-on-demand, high-speed data and voice services.  Revenue increases are derived from rate increases, increases in the number of subscribers to these services, including additional services sold to our existing subscribers, and upgrades by video customers in the level of programming package to which they subscribe.  We also derive revenues from the sale of advertising time available on the programming carried on our cable television systems.  Revenues from advertising vary based upon the number and demographics of our subscribers who view the programming carried on our cable television systems.  Because 64% of our basic video customers as of September 30, 2007 are already subscribers to our high-speed data services, our ability to continue to grow our high-speed data services may be limited.  Programming costs are the most significant part of our operating expenses and are expected to increase as a result of digital subscriber growth, additional service offerings and contractual rate increases.

Our cable television video services, which accounted for 47% of our consolidated revenues for the nine months ended September 30, 2007, face competition from the direct broadcast satellite business and the delivery systems of incumbent telephone companies.  There are two major providers of DBS service in the United States, each with significantly higher numbers of subscribers than we have.  We compete with these DBS competitors by “bundling” our service offerings with products that the DBS companies cannot efficiently provide at this time, such as high-speed data service and voice service carried over the cable distribution plant, as well as by providing interactive services that are currently unavailable to a DBS subscriber.  As discussed in greater detail below, we face intense competition from incumbent telephone companies such as Verizon and AT&T, which offer video programming in addition to their voice and high-speed Internet access services, evidencing their commitment to compete across all of the Company’s telecommunications products.  Their competitive position has been improved by recent operational, regulatory and legislative advances that they have made.  Historically, we have made substantial investments in the development of new and innovative programming options for our customers as a way of differentiating ourselves from our competitors.  We likely will continue to do so in order to be a more effective competitor.

Our high-speed data services business, which accounted for 16% of our consolidated revenues for the nine months ended September 30, 2007, faces competition from DSL providers, including Verizon and AT&T.  These providers have become increasingly aggressive in their pricing strategies in recent years, and customers may decide that a reduced price is more important to them than the superior speed that cable modems provide.  As discussed in greater detail below, another source of competition is fiber-based high speed data offerings by incumbent telephone companies which also include Verizon and AT&T.

53

This competition, together with our already high penetration, is expected to slow our growth in cable modem penetration from the growth rates we have experienced in the past.

Our VoIP offering, which accounted for approximately 8% of our consolidated revenues for the nine months ended September 30, 2007, is competitive with incumbent offerings primarily on the basis of pricing, where unlimited United States, Canada and Puerto Rico long distance, regional and local calling, together with certain features for which the incumbent providers charge extra, are offered at one low price.  To the extent the incumbents, who have financial resources that exceed those of the Company, decide to meet our pricing and/or features or reduce their pricing, future growth and success of this business may be impaired.  The regulatory framework for cable modem service and voice service is being developed and changes in how we, and our competitors, are regulated, including increased regulation, may affect our competitive position.

The telephone companies continue constructing systems designed to provide video programming as well as voice and data services to residential customers in our service area.  AT&T has begun offering video services in our service area in Connecticut and has obtained authorization to provide such service throughout its Connecticut footprint.  What regulatory requirements are applicable to AT&T’s video services is the subject of litigation in federal court.  Verizon has constructed fiber to the home network plant that passes a significant number of households in our service area (currently about a quarter of the households according to our estimates).  Verizon has obtained authority to provide video service (it already has or needs no authority to provide phone and data services) for a majority of these homes passed, on a statewide basis in New Jersey and through numerous local franchises in New York and is offering service in both states.  Verizon has so far not sought to obtain authority for video service in Connecticut.

Optimum Lightpath, which accounted for approximately 3% of our consolidated revenues for the nine months ended September 30, 2007, operates in the most competitive business telecommunications market in the country and competes against the very largest telecommunications companies - incumbent local exchange companies such as Verizon and AT&T, other competitive local exchange companies and long distance companies.  To the extent that dominant market leaders decide to reduce their prices, future success of our Optimum Lightpath business may be impaired.  The trend in business communications has been shifting from a wired voice medium to a wireless, data medium.  Should this trend accelerate dramatically, future growth of Optimum Lightpath may be negatively impacted.

Rainbow

In our Rainbow segment, which accounted for 14% of our consolidated revenues for the nine months ended September 30, 2007, we earn revenues in two principal ways.  First, we receive affiliate fee payments principally from cable television system and DBS operators.  These revenues are generally on a per subscriber basis and earned under multi-year contracts with those operators referred to as affiliation agreements.  The specific affiliate fee revenues we earn vary from operator to operator and also vary among our networks, but are generally based upon the number of each operator’s subscribers who receive our programming, referred to as “viewing subscribers.”  The second principal source of revenues in this segment is from advertising.  Under our agreements with cable television system and DBS operators, we have the right to sell a specific amount of national advertising time on our programming networks.  Our advertising revenues are more variable than affiliate fee revenues because most of our advertising is sold on a short-term basis, not under long-term contracts.  Also, our advertising revenues vary based upon the popularity of our programming as measured by rating services.

We seek to grow our revenues in the Rainbow segment by increasing the number of distributors that carry our services and the number of viewing subscribers.  We refer to this as our “penetration.”  AMC, which

54

is widely distributed, has less ability to increase its penetration than our newer, less penetrated services.  Our revenues may also increase over time through contractual rate increases stipulated in certain of our affiliation agreements.  In negotiating for increased or extended carriage, we may be subject to requests by distributors to make upfront payments in exchange for additional subscribers or extended carriage, which we record as deferred carriage fees and which are amortized as a reduction to revenue over the period of the related subscriber guarantee, or to waive for a specified period or accept lower per subscriber fees if certain additional subscribers are provided.  We also may help fund the distributors’ efforts to market our channels or we may permit distributors to offer limited promotional periods without payment of subscriber fees.  As we continue our efforts to add subscribers, our subscriber revenue may be negatively affected by subscriber acquisition fees (deferred carriage), discounted subscriber fees and other payments; however, we believe that these transactions generate a positive return on investment over the contract period.  We seek to increase our advertising revenues by increasing the number of minutes of national advertising and by increasing rates for such advertising, but, ultimately, the level of our advertising revenues is directly related to the overall distribution of our programming, penetration of our services, and the popularity (including within desirable demographic groups) of our services as measured by rating services.

The principal goals in this segment are to increase our affiliation fee revenues and our advertising revenues by increasing distribution and penetration of our national services.  To do this we must continue to contract for and produce high-quality, attractive programming.  Our greatest challenge arises from the increasing concentration of subscribers in the hands of a few cable television system and DBS operators, creating disparate bargaining power between us and the largest cable television systems and DBS operators.  This increased concentration could adversely affect our ability to increase the penetration of our services or even result in decreased penetration.  In addition, this concentration gives those operators greater leverage in negotiating the pricing and other terms of affiliation agreements.  Moreover, as a result of this concentration, the potential impact of a loss of any one of our major affiliate relationships would have a significant impact on this segment.

Madison Square Garden

Madison Square Garden (“MSG”), which accounted for 12% of our consolidated revenues for the nine months ended September 30, 2007, consists of our owned professional sports teams (principally the New York Knicks of the National Basketball Association (“NBA”) and the New York Rangers of the National Hockey League (“NHL”), along with the Hartford Wolf Pack of the American Hockey League and the New York Liberty of the Women’s National Basketball Association), the MSG Networks sports programming business, and an entertainment business.  It also operates the Madison Square Garden Arena and Radio City Music Hall, and, effective January 1, 2007, the Beacon Theatre in New York City.  In October 2007, Madison Square Garden purchased the Chicago Theatre. Through June 30, 2007, it also operated the Hartford Civic Center and Rentschler Field (sports and entertainment venues in Connecticut).  Madison Square Garden faces competitive challenges unique to these activities.  We derive revenues in this segment primarily from the MSG Networks (see below), the sale of tickets, including luxury box rentals, to sporting and entertainment events, from rental rights fees paid to this segment by promoters that present events at our entertainment venues and the sports teams’ share of league-wide distributions of national television rights fees and royalties.  We also derive revenue from the sale of advertising at our owned and operated venues, from food, beverage and merchandise sales at these venues and from the licensing of our trademarks.  MSG Networks derives its revenues from affiliate fees paid by cable television providers (including our cable television systems), satellite providers that provide video service and sales of advertising.  This segment’s financial performance is related to the performance of all the teams presented and the attractiveness of its entertainment events.

Our sports teams’ financial success is dependent on their ability to generate advertising sales, paid attendance, luxury box rentals, and food, beverage and merchandise sales.  To a large extent, the ability of

55

the teams to build excitement among fans, and therefore produce higher revenue streams, depends on the teams’ winning performance, which generates regular season and playoff attendance and luxury box rentals, and which also supports increases in prices charged for tickets, luxury box rentals, and advertising placement.  Each team’s success is dependent on its ability to acquire highly competitive personnel.  The governing bodies of the NBA and the NHL have the power and authority to take certain actions that they deem to be in the best interest of their respective leagues, which may not necessarily be consistent with maximizing our professional sports teams’ results of operations.

MSG Networks sports programming business is affected by our ability to secure desired programming of professional sports teams, in addition to our proprietary programming.  The continued carriage and success of the teams that are telecast by us will impact our revenues from distribution and from the rates charged for affiliation and advertising, as well as the ability to attract advertisers.

Madison Square Garden’s entertainment business is largely dependent on the continued success of our Radio City Christmas Spectacular and our touring Christmas shows, as well as the availability of, and our venues’ ability to attract, concerts, family shows and events.

In the first quarter of 2007, the Connecticut Development Authority notified Madison Square Garden that it decided not to renew Madison Square Garden’s operating agreement for the Hartford Civic Center that expired on June 30, 2007.  In the second quarter of 2007, Madison Square Garden also received from the State of Connecticut’s Office of Policy and Management a termination notice of the operating agreement for Rentschler Field effective June 30, 2007. The termination of these operating agreements are not expected to have a material impact on Madison Square Garden’s results of operations.

The dependence of this segment’s revenues on its sports teams and Christmas shows generally make it seasonal with a disproportionate share of its revenues and operating income being derived in the fourth quarter of each year.

Stock Option Related Matters

We have continued to incur substantial expenses for legal services in connection with the Company’s stock option related litigation, and the investigations by the Securities and Exchange Commission and the U.S. Attorney’s Office for the Eastern District of New York.  We expect to continue to incur substantial expenses in connection with these matters.

56

Results of Operations - Cablevision Systems Corporation

The following table sets forth on a historical basis certain items related to operations as a percentage of net revenues for the periods indicated.

STATEMENT OF OPERATIONS DATA

	Three Months Ended September 30,
	2007					2006					Increase
				% of Net					% of Net		(Decrease)
	Amount			Revenues		Amount			Revenues		in Net Income
Revenues, net	$	1,511,799		100	%	$	1,381,716		100	%	$	130,083
Operating expenses:
Technical and operating (excluding depreciation, amortization and impairments shown below)	637,807			42		624,820			45		(12,987		)
Selling, general and administrative	390,618			26		346,446			25		(44,172		)
Restructuring charges (credits)	1,107			—		(1,729		)	—		(2,836		)
Depreciation and amortization (including impairments)	280,199			19		285,207			21		5,008
Operating income	202,068			13		126,972			9		75,096
Other income (expense):
Interest expense, net	(224,134		)	(15	)	(238,809		)	(17	)	14,675
Equity in net income of affiliates	—			—		2,677			—		(2,677		)
Loss on sale of affiliate interests	(618		)	—		—			—		(618		)
Gain (loss) on investments, net	(46,136		)	(3	)	100,922			7		(147,058		)
Gain (loss) on derivative contracts, net	1,185			—		(130,019		)	(9	)	131,204
Write-off of deferred financing costs	(2,919		)	—		(6,084		)	—		3,165
Loss on extinguishment of debt	(19,113		)	(1	)	—			—		(19,113		)
Minority interests	(401		)	—		381			—		(782		)
Miscellaneous, net	457			—		2,256			—		(1,799		)
Loss from continuing operations before income taxes	(89,611		)	(6	)	(141,704		)	(10	)	52,093
Income tax benefit	10,715			1		79,969			6		(69,254		)
Loss from continuing operations	(78,896		)	(5	)	(61,735		)	(4	)	(17,161		)
Income (loss) from discontinued operations, net of taxes	(440		)	—		2,578			—		(3,018		)
Net loss	$	(79,336	)	(5	)%	$	(59,157	)	(4	)%	$	(20,179	)

57

	Nine Months Ended September 30,
	2007					2006					Increase
				% of Net					% of Net		(Decrease)
	Amount			Revenues		Amount			Revenues		in Net Income
Revenues, net	$	4,642,416		100	%	$	4,166,173		100	%	$	476,243
Operating expenses:
Technical and operating (excluding depreciation, amortization and impairments shown below)	2,053,732			44		1,869,002			45		(184,730		)
Selling, general and administrative	1,161,850			25		1,074,732			26		(87,118		)
Restructuring charges (credits)	2,562			—		(4,483		)	—		(7,045		)
Depreciation and amortization (including impairments)	843,497			18		840,782			20		(2,715		)
Operating income	580,775			13		386,140			9		194,635
Other income (expense):
Interest expense, net	(686,020		)	(15	)	(658,982		)	(16	)	(27,038		)
Equity in net income of affiliates	4,377			—		5,872			—		(1,495		)
Gain on sale of affiliate interests	183,270			4		—			—		183,270
Gain (loss) on investments, net	(31,505		)	(1	)	179,113			4		(210,618		)
Gain (loss) on derivative contracts, net	37,087			1		(172,634		)	(4	)	209,721
Write-off of deferred financing costs	(2,919		)	—		(14,083		)	—		11,164
Loss on extinguishment of debt	(19,113		)	—		(13,125		)	—		(5,988		)
Minority interests	814			—		1,279			—		(465		)
Miscellaneous, net	1,908			—		2,283			—		(375		)
Income (loss) from continuing operations before income taxes	68,674			1		(284,137		)	(7	)	352,811
Income tax (expense) benefit	(53,586		)	(1	)	137,591			3		(191,177		)
Income (loss) from continuing operations	15,088			—		(146,546		)	(4	)	161,634
Income from discontinued operations, net of taxes	197,175			4		44,867			1		152,308
Income (loss) before cumulative effect of a change in accounting principle	212,263			5		(101,679		)	(2	)	313,942
Cumulative effect of a change in accounting principle, net of taxes	(443		)	—		(862		)	—		419
Net income (loss)	$	211,820		5	%	$	(102,541	)	(2	)%	$	314,361

58

Comparison of Three and Nine Months Ended September 30, 2007 Versus Three and Nine Months Ended September 30, 2006

Consolidated Results – Cablevision Systems Corporation

The Company classifies its business interests into three reportable segments:

•Telecommunications Services, consisting principally of our video, high-speed data, and Voice over Internet Protocol services and our commercial data and voice services operations of Optimum Lightpath;

•Rainbow, consisting principally of interests in national and regional television programming networks, including AMC, IFC, WE tv, fuse, News 12 and VOOM HD Networks; and

•Madison Square Garden, which owns and operates professional sports teams, regional television sports programming networks and an entertainment business.

The Company allocates certain costs to each segment based upon their proportionate estimated usage of services. The segment financial information set forth below, including the discussion related to individual line items, does not reflect intersegment eliminations unless specifically indicated.

See “Business Segments Results” for a more detailed discussion relating to the operating results of our segments.

Revenues, net for the three and nine months ended September 30, 2007 increased $130,083 (9%) and $476,243 (11%), respectively, as compared to revenues for the same periods in the prior year. The net increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Increase in revenues of the Telecommunications Services segment	$	103,717		$	385,511
Increase in revenues of the Rainbow segment	31,729			77,026
Increase in revenues of the Madison Square Garden segment	1,743			33,789
Other net decreases	(160		)	(3,751		)
Inter-segment eliminations	(6,946		)	(16,332		)
	$	130,083		$	476,243

Technical and operating expenses (excluding depreciation, amortization and impairments) include primarily:

•cable programming costs which are costs paid to programmers, net of amortization of any launch support received, for cable content and are generally paid on a per-subscriber basis;

•network management and field service costs which represent costs associated with the maintenance of our broadband network, including costs of certain customer connections;

•contractual rights expense to broadcast certain live sporting events and contractual compensation expense pursuant to employment agreements with professional sports teams’ personnel;

•amortization of costs to license programming, including feature films, and programming and production costs of our Rainbow businesses; and

•interconnection, call completion and circuit fees relating to our telephone and VoIP businesses which represent the transport and termination of calls with other telecommunications carriers.

59

Technical and operating expenses for the three and nine months ended September 30, 2007 increased $12,987 (2%) and $184,730 (10%), respectively, compared to the same periods in 2006. The net increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Increase in expenses of the Telecommunications Services segment	$	41,264		$	209,033
Increase in expenses of the Rainbow segment	8,330			15,649
Decrease in expenses of the Madison Square Garden segment	(29,765		)	(25,363		)
Other net decreases	(477		)	(1,090		)
Inter-segment eliminations	(6,365		)	(13,499		)
	$	12,987		$	184,730

As a percentage of revenues, technical and operating expenses decreased 3% and 1% during the three and nine months ended September 30, 2007, respectively, as compared to the same periods in 2006.

Selling, general and administrative expenses include primarily sales, marketing and advertising expenses, administrative costs and costs of customer call centers. Selling, general and administrative expenses increased $44,172 (13%) and $87,118 (8%) for the three and nine months ended September 30, 2007, respectively, as compared to the same periods in 2006. The net increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Increase in expenses of the Telecommunications Services segment	$	23,693		$	73,183
Increase in expenses of the Rainbow segment	5,930			7,723
Increase in expenses of the Madison Square Garden segment	14,631			17,540
Other net increases (decreases)	498			(7,380		)
Inter-segment eliminations	(580		)	(3,948		)
	$	44,172		$	87,118

As a percentage of revenues, selling, general and administrative expenses increased 1% for the three months ended September 30, 2007 and decreased 1% for the nine months ended September 30, 2007 as compared to the same periods in 2006.

Restructuring charges (credits) amounted to $1,107 and $2,562 for the three and nine months ended September 30, 2007, respectively, and $(1,729) and $(4,483) for the three and nine months ended September 30, 2006, respectively. The charges for the three and nine months ended September 30, 2007 related primarily to severance charges associated with the elimination of 54 positions at certain programming businesses within the Rainbow segment and net adjustments to facility realignment provisions recorded in connection with the 2006, 2002 and 2001 restructuring plans. The credits for the three and nine months ended September 30, 2006 related primarily to adjustments to facility realignment provisions recorded in connection with the 2001 and 2002 restructuring plans.

Depreciation and amortization expense (including impairments) decreased $5,008 (2%) for the three months ended September 30, 2007 and increased $2,715 for the nine months ended September 30, 2007 as compared to the same periods in 2006. The net decrease for the three month period consisted of a net decrease in depreciation expense of $4,007 due to certain fixed assets becoming fully depreciated, partially offset by depreciation related to new fixed assets and a decrease in amortization expense of $1,001 related primarily to certain long-lived assets becoming fully amortized in the first quarter of 2007. The net increase for the nine month period consisted of an increase in depreciation expense of $6,047 due

60

primarily to depreciation of new fixed assets and losses on certain asset disposals, partially offset by a decrease in amortization expense of $3,332 due to certain long-lived assets becoming fully amortized.

Net interest expense decreased $14,675 for the three months ended September 30, 2007 and increased $27,038 for the nine months ended September 30, 2007 as compared to the same periods in 2006. The net changes were attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Increase due to higher average debt balances related primarily to the financing of the 2006 special dividend in the second quarter of 2006, partially offset by lower outstanding collateralized indebtedness and the redemption of certain senior subordinated notes and debentures in May 2006 and August 2007	$	—		$	29,812
Decrease due to lower average debt balances (including lower outstanding collateralized indebtedness and the redemption of certain senior subordinated notes and debentures in May 2006 and August 2007)	(4,477		)	—
Increase (decrease) due to fluctuations in average interest rates	(1,166		)	1,042
Higher interest income	(8,772		)	(1,199		)
Other net decreases	(260		)	(2,617		)
	$	(14,675	)	$	27,038

Equity in net income of affiliates amounted to $4,377 for the nine months ended September 30, 2007, compared to $2,677 and $5,872 for the three and nine months ended September 30, 2006, respectively. Such amounts consist of the Company’s share of the net income or loss of certain businesses in which the Company had varying minority equity method ownership interests until June 2007.

Gain (loss) on sale of affiliate interests amounted to $(618) and $183,270 for the three and nine months ended September 30, 2007, respectively, and resulted from the sale of our 50% equity interest in the Fox Sports Net New England business in June 2007.

Gain (loss) on investments, net for the three and nine months ended September 30, 2007 of  $(46,136) and $(31,505), respectively, and $100,922 and $179,113 for the three and nine months ended September 30, 2006, respectively, consists primarily of the net change in the fair value of Comcast, General Electric, AT&T, Charter Communications, and Leapfrog common stock owned by the Company. The effects of these gains and losses are largely offset by the losses and gains on related derivative contracts described below.

Gain (loss) on derivative contracts, net for the three and nine months ended September 30, 2007 and 2006 consists of the following:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Unrealized and realized gains (losses) due to the change in fair value of the Company’s prepaid forward contracts relating to the AT&T, Comcast, Charter Communications, General Electric and Leapfrog shares	$	52,637		$	(72,898	)	$	61,225		$	(125,923	)
Unrealized and realized losses on interest rate swap contracts	(51,452		)	(57,121		)	(24,138		)	(46,711		)
	$	1,185		$	(130,019	)	$	37,087		$	(172,634	)

61

The effects of these gains and losses are largely offset by the losses and gains on investment securities pledged as collateral which are included in gain (loss) on investments, net discussed above.

Write-off of deferred financing costs of $2,919 for the three and nine month periods ended September 30, 2007 represents costs written off in connection with the partial redemption in August 2007 of Rainbow National Services’ senior subordinated notes due 2014. The write-off of deferred financing costs of  $6,084 for the three months ended September 30, 2006 represents costs written off in connection with the refinancing of the Rainbow National Services credit agreement in July 2006. The write-off of deferred financing costs of $14,083 for the nine months ended September 30, 2006 also includes $3,412 of costs written off in connection with the early redemption of CSC Holdings’ $250,000 principal amount of 10-1/2% senior subordinated debentures due 2016 in June 2006 and $4,587 of costs written off in connection with the refinancing of the CSC Holdings credit agreement in February 2006.

Loss on extinguishment of debt of $19,113 for the three and nine months ended September 30, 2007 represents the excess of the redemption price over the carrying value of the $175,000 principal amount of Rainbow National Services senior subordinated notes due 2014 redeemed in August 2007. Loss on extinguishment of debt of $13,125 for the nine months ended September 30, 2006 represents the premium paid on the early redemption of CSC Holdings’ $250,000 principal amount of 10-1/2% senior subordinated debentures due 2016.

Minority interests for the three and nine months ended September 30, 2007 of $(401) and $814, respectively, and $381 and $1,279, for the three and nine months ended September 30, 2006, respectively, represent other parties’ share of the net income (loss) of entities which are not entirely owned by us but which are consolidated in our financial statements.

Net miscellaneous income of $457 and $1,908 for the three and nine months ended September 30, 2007 and $2,256 and $2,283 for the three and nine months ended September 30, 2006, respectively, resulted primarily from dividends received on certain of the Company’s investment securities, partially offset by other miscellaneous expenses.

Income tax benefit attributable to continuing operations for the three months ended September 30, 2007 of $10,715 differs from the income tax benefit derived from applying the statutory federal rate to the pretax loss due principally to state taxes, tax benefit of $121, including accrued interest, recorded pursuant to FIN 48, an increase in the valuation allowance of $707 relating to certain state net operating loss carry forwards, and the tax impact of non-deductible officers’ compensation of $4,275 and other non-deductible expenses of $1,281.

Income tax expense attributable to continuing operations for the nine months ended September 30, 2007 of $53,586 differs from the income tax expense derived from applying the statutory federal rate to pretax income due principally to state taxes, tax expense of $5,027, including accrued interest, recorded pursuant to FIN 48, tax expense of $1,947 resulting from a change in the deferred tax rate and the tax impact of non-deductible officers’ compensation of $7,314 and other non-deductible expenses of $4,436, partially offset by a decrease in the valuation allowance of $1,303 relating to certain state net operating loss carry forwards.

In general, the Company is required to use an estimated annual effective tax rate to measure the tax benefit or tax expense recognized in an interim period. The estimated annual effective tax rate is revised on a quarterly basis and therefore may be different from the rate used for a prior interim period. The income tax expense for the nine months ended September 30, 2007 was determined as if the interim period was a discrete period. However, the tax expense for the six months ended June 30, 2007 was determined using an estimated annual effective tax rate. The difference in methodology from June 2007

62

to September 2007 resulted from a change in our projection of pretax income from continuing operations excluding the gain on the sale of Fox Sports Net New England. After excluding the gain on the sale of Fox Sports Net New England, at September 30, 2007, we estimated a pretax loss for 2007, whereas at June 30, 2007 we had estimated pretax income. The income tax benefit for the three months ended September 30, 2007 is equal to the difference between the income tax provision for the six month and nine month periods ended June 30, 2007 and September 30, 2007.

The income tax benefit attributable to continuing operations for the three months ended September 30, 2006 of $79,969 differs from the income tax benefit derived from applying the statutory federal rate to the pretax loss due principally to state taxes, tax benefit of $16,356 resulting from the reduction of a tax contingency liability, an increase in the valuation allowance of $865 relating to certain state net operating loss carry forwards and the tax impact of non-deductible officers’ compensation of $1,393 and other non-deductible expenses of $954.

The income tax benefit attributable to continuing operations for the nine months ended September 30, 2006 of $137,591 differs from the income tax benefit derived from applying the statutory federal rate to the pretax loss due principally to state taxes, a decrease in the valuation allowance of $5,414 relating to certain state net operating loss carry forwards, tax benefit of $5,013 resulting from the favorable settlement of an issue with a taxing authority, tax benefit of $16,356 resulting from the reduction of a tax contingency liability, partially offset by the tax impact of non-deductible officers’ compensation of $3,951 and other non-deductible expenses of $4,780.

Income (loss) from discontinued operations

In April 2005, the operations of the Rainbow DBS satellite distribution business were shut down. In connection with the shut down, certain assets of the business, including the Rainbow 1 direct broadcast satellite and certain other related assets were sold to a subsidiary of EchoStar for $200,000 in cash. This transaction closed in November 2005.

In June 2006, the operations of the Fox Sports Net Chicago programming business were shut down and in June 2007, the Company completed the sale of its 60% ownership interest in the Fox Sports Net Bay Area business.

Income (loss) from discontinued operations, net of taxes, for the three and nine months ended September 30, 2007 and 2006 reflects the following items, net of related income taxes:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007		2006
Gain (loss) on sale of Fox Sports Net Bay Area, net of taxes	$	(69	)	$	—		$	187,784	$	—
Net operating results of Fox Sports Net Bay Area, net of taxes	—			2,999			4,827		6,972
Net operating results of the Rainbow DBS distribution business, net of taxes	(371		)	(605		)	4,564		(2,879		)
Net operating results of Fox Sports Net Chicago, net of taxes *	—			184			—		40,774
	$	(440	)	$	2,578		$	197,175	$	44,867

*This amount includes approximately $46,100, net of taxes, representing the collection in June 2006 of affiliate revenue from a cable affiliate, including approximately $42,200, net of taxes, relating to periods prior to 2006, that had not been previously recognized due to a contractual dispute. The underlying contract was terminated in June 2006 and no further payments will be received under this contract.

63

In March 2007, the Federal Communications Commission (“FCC”) waived the bond requirement previously submitted by Rainbow DBS Company LLC with respect to five Ka-band licenses. These bonds were originally cash collateralized by the Company. In connection with the shut down of the Rainbow DBS satellite distribution business in 2005, the Company recorded a loss related to the outstanding bonds since the Company believed it was not probable that Rainbow DBS would meet the required FCC milestones. As a result of the waiver from the FCC, the Company recorded a gain of $6,638, net of taxes, in the quarter ended March 31, 2007. The Company received the cash collateral of $11,250 in the quarter ended June 30, 2007.

Business Segments Results – Cablevision Systems Corporation

Telecommunications Services

The table below sets forth, for the periods presented, certain historical financial information and the percentage that those items bear to revenue for the Company’s Telecommunications Services segment:

	Three Months Ended September 30,
	2007				2006				Increase (Decrease) in
	Amount		% of Net Revenues		Amount		% of Net Revenues		Operating Income
Revenues, net	$	1,179,471	100	%	$	1,075,754	100	%	$	103,717
Technical and operating expenses (excluding depreciation and amortization)	510,272		43		469,008		44		(41,264		)
Selling, general and administrative expenses	228,049		19		204,356		19		(23,693		)
Depreciation and amortization	233,100		20		233,871		22		771
Operating income	$	208,050	18	%	$	168,519	16	%	$	39,531

	Nine Months Ended September 30,
	2007				2006					Increase (Decrease) in
	Amount		% of Net Revenues		Amount			% of Net Revenues		Operating Income
Revenues, net	$	3,503,598	100	%	$	3,118,087		100	%	$	385,511
Technical and operating expenses (excluding depreciation and amortization)	1,510,359		43		1,301,326			42		(209,033		)
Selling, general and administrative expenses	685,447		20		612,264			20		(73,183		)
Restructuring credits	—		—		(17		)	—		(17		)
Depreciation and amortization	700,917		20		686,506			22		(14,411		)
Operating income	$	606,875	17	%	$	518,008		17	%	$	88,867

64

Revenues, net for the three and nine months ended September 30, 2007 increased $103,717 (10%) and $385,511 (12%), respectively, compared to revenues for the same periods in the prior year. The following tables present the major components of revenues for the three and nine months ended September 30, 2007 and 2006 for the Company’s Telecommunications Services segment:

	Three Months Ended September 30,						Increase			Percent Increase
	2007			2006			(Decrease)			(Decrease)
Video (including analog, digital, pay-per-view, video-on-demand and digital video recorder)	$	688,716		$	652,086		$	36,630		6	%
High-speed data	254,155			228,141			26,014			11	%
Voice	137,938			98,554			39,384			40	%
Advertising	28,833			29,674			(841		)	(3	)%
Other (including installation, home shopping, advertising sales commissions, and other products)	25,847			27,054			(1,207		)	(4	)%
Total cable television	1,135,489			1,035,509			99,980			10	%
Optimum Lightpath	55,296			52,026			3,270			6	%
Intra-segment eliminations	(11,314		)	(11,781		)	467			4	%
Total Telecommunications Services	$	1,179,471		$	1,075,754		$	103,717		10	%

	Nine Months Ended September 30,						Increase			Percent Increase
	2007			2006			(Decrease)			(Decrease)
Video (including analog, digital, pay-per-view, video-on-demand and digital video recorder)	$	2,071,673		$	1,912,743		$	158,930		8	%
High-speed data	750,995			663,419			87,576			13	%
Voice	387,313			257,118			130,195			51	%
Advertising	85,659			81,839			3,820			5	%
Other (including installation, home shopping, advertising sales commissions, and other products)	78,619			81,436			(2,817		)	(3	)%
Total cable television	3,374,259			2,996,555			377,704			13	%
Optimum Lightpath	159,353			158,930			423			—
Intra-segment eliminations	(30,014		)	(37,398		)	7,384			20	%
Total Telecommunications Services	$	3,503,598		$	3,118,087		$	385,511		12	%

Revenue increases reflected above are primarily derived from increases in the number of subscribers to our services, including additional services sold to our existing subscribers, (set forth in the table below), upgrades by video customers from the level of the programming package to which they subscribe, and general increases in rates, offset in part by offer discounts and other rate changes. As a result, our average monthly revenue per basic video subscriber for the three months ended September 30, 2007 was $120.91 as compared with $111.13 for the three months ended September 30, 2006. The increase in Optimum Lightpath net revenues for the three and nine months ended September 30, 2007 is primarily attributable to growth in Ethernet data services, partially offset by reduced traditional data services and intra-segment revenue from the VoIP business.

65

The following table presents certain subscriber information as of September 30, 2007 and 2006 for the Company’s cable television systems (excluding Optimum Lightpath):

	As of September 30,		Increase		Percent Increase
	2007	2006	(Decrease)		(Decrease)
		(in thousands)
Basic video customers	3,122	3,111	11		—
iO digital video customers	2,585	2,364	221		9	%
Optimum Online high-speed data customers	2,220	1,964	256		13	%
Optimum voice customers	1,490	1,101	389		35	%
Residential telephone customers	—	6	(6	)	(100	)%
Total revenue generating units	9,417	8,546	871		10	%

For the nine months ended September 30, 2007, the Company had a decline of approximately 5,000 basic video customers and added approximately 590,000 revenue generating units (“RGUs”). In the third quarter of 2007, the Company had a decline of approximately 16,000 basic video customers and added approximately 161,000 RGUs. The decline in basic video customers for the third quarter period was also reflected in the Company’s quarterly RGU growth, which slowed from 1.8% in the second quarter to 1.7% in the third quarter. Because of the Company’s relatively high digital video penetration rates, and to a lesser extent, the increasing competition by Verizon in our service territory, we expect this trend to continue and for RGU growth for 2007 to be lower than what we experienced in 2006, and for the number of basic video subscribers at year end 2007 to essentially equal the number of subscribers at the beginning of the year.

66

Technical and operating expenses (excluding depreciation and amortization) for the three and nine months ended September 30, 2007 increased $41,264 (9%) and $209,033 (16%), respectively, compared to the same periods in 2006. The net increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Increase in programming costs (including costs of on-demand services) due primarily to subscriber growth, expanded service offerings, and programming rate increases	$	27,881		$	110,744
Resolution of a contractual programming dispute*	—			26,476
Increase in field service and network related costs primarily due to growth in revenue generating units	12,802			48,156
Increase in call completion and interconnection costs, taxes, and fees (net of related intra-segment eliminations) primarily due to subscriber growth, partially offset by lower rates, and higher costs for our flat-rate international service offering which began in the second quarter of 2006	3,263			28,335
Increase in franchise fees	1,823			7,014
Net decrease in expense due to tax-related settlements in 2006**	(4,461		)	(12,094		)
Intra-segment eliminations	(33		)	585
Other net changes	(11		)	(183		)
	$	41,264		$	209,033

*Represents the collection of $26,476 in June 2006 related to the resolution of a contractual programming dispute, $19,476 of which was due in periods prior to 2006 but not recognized as a reduction to programming costs because it was being disputed and not paid by the third party. The underlying contract was terminated in June 2006 and no further payments will be received under the contract. Payments under the contract are accounted for as an offset to technical and operating expenses.

**Beginning in 2007, certain of these taxes are now being collected from customers by the Company as agent and, accordingly, are reported as a reduction of revenue. Such taxes amounted to $3,847 and $11,224, respectively, for the three and nine months ended September 30, 2007.

As a percentage of revenues, technical and operating expenses decreased 1% for the three months ended September 30, 2007 and increased 1% for the nine months ended September 30, 2007 as compared to the same periods in 2006.

Selling, general and administrative expenses for the three and nine months ended September 30, 2007 increased $23,693 (12%) and $73,183 (12%), respectively, compared to the same periods in 2006. The net increases are attributable to the following:

	Three Months			Nine Months
	Ended June 30, 2007
Increase in sales and marketing costs	$	17,066		$	44,130
Increase in customer related costs (principally call center related costs) primarily due to increased revenue generating units	7,796			25,373
Decrease in expenses relating to Cablevision’s long-term incentive and stock plans	(2,198		)	(629		)
Other general and administrative cost increases	1,061			3,724
Intra-segment eliminations	(32		)	585
	$	23,693		$	73,183

As a percentage of revenues, selling, general and administrative expenses remained constant for the three and nine months ended September 30, 2007 as compared to the same periods in 2006.

67

Depreciation and amortization decreased $771 and increased $14,411 (2%) for the three and nine months ended September 30, 2007, respectively, compared to the same periods in 2006. The net increase for the nine month period resulted primarily from depreciation of new fixed assets, primarily subscriber devices, and losses on certain asset disposals, partially offset by lower depreciation due to certain asset disposals in the fourth quarter 2006.

Rainbow

The table below sets forth, for the periods presented, certain historical financial information and the percentage that those items bear to revenues for the Company’s Rainbow segment:

	Three Months Ended September 30,
	2007				2006				Increase (Decrease) in
	Amount		% of Net Revenues		Amount		% of Net Revenues		Operating Income
Revenues, net	$	221,751	100	%	$	190,022	100	%	$	31,729
Technical and operating expenses (excluding depreciation, amortization and impairments)	84,869		38		76,539		40		(8,330		)
Selling, general and administrative expenses	87,927		40		81,997		43		(5,930		)
Restructuring charges	971		—		—		—		(971		)
Depreciation and amortization (including impairments)	22,992		10		24,709		13		1,717
Operating income	$	24,992	11	%	$	6,777	4	%	$	18,215

	Nine Months Ended September 30,
	2007				2006					Increase (Decrease) in
	Amount		% of Net Revenues		Amount			% of Net Revenues		Operating Income
Revenues, net	$	650,516	100	%	$	573,490		100	%	$	77,026
Technical and operating expenses (excluding depreciation, amortization and impairments)	257,227		40		241,578			42		(15,649		)
Selling, general and administrative expenses	276,138		42		268,415			47		(7,723		)
Restructuring charges	2,496		—		143			—		(2,353		)
Depreciation and amortization (including impairments)	69,881		11		73,307			13		3,426
Operating income (loss)	$	44,774	7	%	$	(9,953	)	(2	)%	$	54,727

68

The Rainbow segment’s operating income is comprised of the following:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Operating income (loss):
AMC, WE tv and IFC	$	61,187		$	51,673		$	174,846		$	131,929
Other programming services	(36,195		)	(44,896		)	(130,072		)	(141,882		)
	$	24,992		$	6,777		$	44,774		$	(9,953	)

Other programming services primarily consist of fuse, Lifeskool, sportskool, News 12 Networks, IFC Entertainment, VOOM HD Networks, Rainbow Network Communications and Rainbow Advertising Sales Corporation. The operating losses from Rainbow’s other programming services were attributable primarily to VOOM HD Networks, as well as the News 12 Networks, IFC Entertainment and fuse.

Revenues, net for the three and nine months ended September 30, 2007 increased $31,729 (17%) and $77,026 (13%) as compared to revenues for the same periods in 2006. These increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Increase in affiliate fee revenues and other revenue at Rainbow’s other programming businesses, primarily at VOOM HD Networks due to increased distribution by EchoStar, and the launch of the VOOM HD Networks by Cablevision during the third quarter 2007	$	12,686		$	28,723
Increase in advertising revenues at the AMC/WE tv/IFC businesses	11,119			25,439
Increase in affiliate fee revenues and other revenue at the AMC/WE tv /IFC businesses resulting primarily from increases in viewing subscribers and rates.	8,738			22,262
Increase (decrease) in advertising revenues at Rainbow’s other programming businesses	(814		)	602
	$	31,729		$	77,026

Revenue increases discussed above are primarily derived from increases in the number of viewing subscribers and increases in affiliate fee revenues charged for our services and increases in the level of advertising on our networks. The following table presents certain viewing subscriber information as of September 30, 2007 and 2006:

	As of September 30,			Percent
	2007	2006	Increase	Increase
		(in thousands)
Viewing Subscribers:
AMC	84,100	80,600	3,500	4.3	%
WE tv	55,600	53,000	2,600	4.9	%
IFC	42,800	39,300	3,500	8.9	%
fuse	45,200	40,800	4,400	10.8	%
VOOM HD Networks*	1,800	200	1,600	>100.0	%

*The increase in VOOM HD Networks viewing subscribers is primarily due to growth in distribution of the VOOM HD Networks by EchoStar and the launch of the services during the third quarter of 2007 by Cablevision.

69

Technical and operating expenses (excluding depreciation and amortization and impairments) for the three and nine months ended September 30, 2007 increased $8,330 (11%) and $15,649 (6%) compared to the same periods in 2006. These increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Net increase in other programming costs at the AMC/WE tv /IFC businesses which resulted primarily from increased amortization of programming content and series development/original programming costs	$	8,414		$	14,426
Net increase resulting from higher programming and contractual costs at the other Rainbow businesses primarily at VOOM HD Networks, IFC Entertainment and for Rainbow’s film library assets	4,572			11,958
Net decrease in original programming expenses at the AMC/WE tv /IFC businesses due to certain of those costs qualifying for capitalization in 2007	(4,656		)	(10,735		)
	$	8,330		$	15,649

As a percentage of revenues, technical and operating expenses decreased 2% during both the three and nine months ended September 30, 2007 as compared to the same periods in 2006.

Selling, general and administrative expenses increased $5,930 (7%) and $7,723 (3%) for the three and nine months ended September 30, 2007 as compared to the same period in 2006. The net increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Net increase in selling, marketing and advertising costs at the AMC/WE tv/IFC businesses. The increase for the three month period is due primarily to a increase in marketing and promotion of original programming series premieres	$	6,344		$	126
Net increase in selling, marketing and advertising costs at Rainbow’s other programming services primarily related to marketing and promotional activities. The increase for the nine month period is due primarily to a increase in marketing and promotion at fuse	901			4,581
Increase in expenses relating to Cablevision’s long-term incentive plans	1,351			3,985
Decrease in share-based compensation expenses	(2,254		)	(1,897		)
Increase (decrease) in administrative costs, including corporate allocations	(412		)	928
	$	5,930		$	7,723

As a percentage of revenues, selling, general and administrative expenses decreased 3% and 5% for the three and nine months ended September 30, 2007, respectively, as compared to the same periods in 2006.

Restructuring charges of $971 and $2,496 for the three and nine months ended September 30, 2007, respectively, represent primarily severance charges resulting from the elimination of certain staff positions due to the consolidation and reorganization of certain departments.

Depreciation and amortization (including impairments) decreased $1,717 (7%) and $3,426 (5%) for the three and nine months ended September 30, 2007, respectively, as compared to the same periods in 2006. The decreases in depreciation and amortization expense were primarily attributable to a net decrease in depreciation expense relating to certain fixed assets becoming fully depreciated in 2006 and certain intangible assets becoming fully amortized in the first quarter of 2007.

70

Madison Square Garden

The table below sets forth, for the periods presented, certain historical financial information and the percentage that those items bear to net revenues for Madison Square Garden.

	Three Months Ended September 30,										Increase
	2007					2006					(Decrease) in
	Amount			% of Net Revenues		Amount			% of Net Revenues		Operating Income
Revenues, net	$	130,259		100	%	$	128,516		100	%	$	1,743
Technical and operating expenses (excluding depreciation and amortization)	62,633			48		92,398			72		29,765
Selling, general and administrative expenses	59,688			46		45,057			35		(14,631		)
Depreciation and amortization	14,124			11		15,616			12		1,492
Operating loss	$	(6,186	)	(5	)%	$	(24,555	)	(19	)%	$	18,369

	Nine Months Ended September 30,									Increase
	2007				2006					(Decrease) in
	Amount		% of Net Revenues		Amount			% of Net Revenues		Operating Income
Revenues, net	$	548,191	100	%	$	514,402		100	%	$	33,789
Technical and operating expenses (excluding depreciation and amortization)	342,580		62		367,943			72		25,363
Selling, general and administrative expenses	154,968		28		137,428			27		(17,540		)
Depreciation and amortization	43,645		8		46,271			9		2,626
Operating income (loss)	$	6,998	1	%	$	(37,240	)	(7	)%	$	44,238

71

Revenues, net for the three and nine months ended September 30, 2007 increased $1,743 (1%) and $33,789 (7%), respectively, as compared to revenues for the comparable periods in 2006. These increases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Net higher MSG Networks affiliate fees	$	6,213		$	18,151
Net higher (lower) revenues from entertainment events, including a new New York City venue in 2007 and the termination of the operating agreements for two Connecticut venues effective July 1, 2007	(3,185		)	9,442
Higher sports team playoff related revenue	179			8,785
Higher (lower) other sports team related revenues	(222		)	1,409
Lower other MSG Networks revenue, primarily decreased advertising sales	(1,306		)	(4,202		)
Other net increases	64			204
	$	1,743		$	33,789

Technical and operating expenses (excluding depreciation and amortization) for the three and nine months ended September 30, 2007 decreased $29,765 (32%) and $25,363 (7%), respectively, over the same 2006 periods. These decreases are attributable to the following:

	Three Months			Nine Months
	Ended September 30, 2007
Lower net provisions for certain team personnel transactions (including the impact of luxury tax)	$	(33,175	)	$	(33,319	)
Higher (lower) provision for National Basketball Association’s luxury tax (excluding impact of certain team personnel transactions discussed above)	105			(9,096		)
Higher (lower) other team operating expenses, primarily team personnel compensation for the nine month period	7			(14,752		)
Higher MSG Networks’ operating expenses, primarily production costs	2,168			7,291
Lower benefit from amortization of team related purchase accounting liabilities (see discussion below)	1,495			6,263
Higher sports team playoff related expenses	175			4,835
Higher (lower) costs associated with the net change in the revenues from entertainment events	(4,006		)	2,999
Higher operating costs of venues, primarily from a new New York City venue in 2007	3,185			9,727
Other net increases	281			689
	$	(29,765	)	$	(25,363	)

The purchase accounting liabilities discussed above were established in April 2005 as a result of the Company’s acquisition of the minority interest in Madison Square Garden. Following this transaction, the Company began to amortize these purchase accounting liabilities over the period of the respective player contracts. During 2006 and 2005, the majority of these players were subsequently waived or traded and the unamortized purchase accounting liabilities associated with these players were written off. Unamortized purchase accounting liabilities at September 30, 2007 amounted to $4,488.

As a percentage of revenues, technical and operating expenses decreased 24% and 10% during the three and nine months ended September 30, 2007, respectively, as compared to the same periods in 2006.

72

Selling, general, and administrative expenses for the three and nine months ended September 30, 2007 increased $14,631 (32%) and $17,540 (13%), respectively, over the same 2006 periods. These increases are attributable to the following:

	Three Months		Nine Months
	Ended September 30, 2007
Higher employee salaries and related benefits, including expenses relating to Cablevision’s long-term incentive and stock plans	$	1,563	$	5,125
Other net increases*	13,068		12,415
	$	14,631	$	17,540

*Other net increases include primarily higher legal and other professional fees and provisions for litigation.

As a percentage of revenues, selling, general and administrative expenses increased 11% and 1% in the three and nine months ended September 30, 2007, respectively, as compared to the same periods in 2006.

Depreciation and amortization for the three and nine months ended September 30, 2007 decreased $1,492 (10%) and $2,626 (6%), respectively, as compared to the same periods in 2006.

CASH FLOW DISCUSSION

Operating Activities

Net cash provided by operating activities amounted to $628,129 for the nine months ended September 30, 2007 compared to $688,988 for the nine months ended September 30, 2006. The 2007 cash provided by operating activities resulted from $858,585 of income before depreciation and amortization, $96,366 of non-cash items and a $74,416 increase in deferred revenue, partially offset by decreases in cash resulting from an $124,841 increase in feature film inventory resulting primarily from new film licensing agreements, a $116,680 increase in current and other assets, and a $159,717 decrease in accrued and other liabilities.

The 2006 cash provided by operating activities resulted primarily from $694,236 of income before depreciation and amortization, $68,167 of non-cash items, a $26,585 increase in deferred revenue and a $23,294 increase in accounts payable. Partially offsetting these increases were decreases in cash resulting from a $85,848 increase in feature film inventory resulting from new film licensing agreements, a $23,514 decrease in deferred carriage fees, a $10,072 decrease in accrued and other liabilities and a $3,860 increase in current and other assets.

Investing Activities

Net cash used in investing activities for the nine months ended September 30, 2007 was $319,701 compared to $688,132 for the nine months ended September 30, 2006. The 2007 investing activities consisted primarily of $554,371 of capital expenditures ($515,098 of which related to our Telecommunications Services segment), partially offset by proceeds from the sale of the Company’s interest in Fox Sports Net New England of $208,119, net distributions from equity method investees of $24,506, and other cash receipts of $2,045.

Net cash used in investing activities for the nine months ended September 30, 2006 consisted primarily of $699,877 of capital expenditures ($662,560 of which related to our Telecommunications Services segment), partially offset by other net cash receipts aggregating $11,745.

73

Financing Activities

Net cash used in financing activities amounted to $379,228 for the nine months ended September 30, 2007 compared to net cash provided by financing activities of $24,383 for the nine months ended September 30, 2006. In 2007, the Company’s financing activities consisted primarily of a redemption of senior subordinated notes of $193,158, a payment of $68,978 representing the deemed purchase of treasury stock related to restricted stock awards that vested in the nine month period, dividend distributions relating to the exercise or vesting of equity based awards of $67,313, net repayments of bank debt of $61,250 and other net cash payments of $18,926, partially offset by proceeds from the exercise of stock options of $30,397.

In 2006, the Company’s financing activities consisted primarily of net proceeds of bank debt of $3,177,750, partially offset by a $2,838,591 dividend distribution to common stockholders, $263,125 redemption of CSC Holdings’ 10-1/2% senior subordinated debentures due 2016, $47,374 in deferred financing costs and other net cash payments of $4,277.

Discontinued Operations

The net effect of discontinued operations on cash and cash equivalents amounted to a $354,646 inflow for the nine months ended September 30, 2007 compared to a $115,141 inflow for the nine months ended September 30, 2006.

Operating Activities

Net cash provided by operating activities of discontinued operations amounted to $17,827 for the nine months ended September 30, 2007 compared to $95,727 for the nine months ended September 30, 2006. The 2007 period includes operating results of Fox Sports Net Bay Area for the six months ended June 30, 2007 compared to nine months of operating results in the comparable 2006 period. The 2007 cash provided by operating activities resulted primarily from net income of $27,604 before depreciation and amortization and non-cash items, partially offset by a net change in assets and liabilities of $9,777. The 2006 period includes the collection of $77,996 by Fox Sports Net Chicago in June 2006 of affiliate revenue from a cable affiliate, including $71,396 relating to periods prior to 2006, that had not been previously recognized due to a contractual dispute. The 2006 cash provided by operating activities resulted primarily from net income of $104,190 before depreciation and amortization and non-cash items, partially offset by a net change in assets and liabilities of $8,463.

Investing Activities

Net cash provided by investing activities of discontinued operations for the nine months ended September 30, 2007 was $312,358 compared to $4,013 for the nine months ended September 30, 2006. The 2007 investing activities consisted of $366,031 of proceeds (net of cash on hand) from the sale of the Company’s interest in Fox Sports Net Bay Area, partially offset by an increase in restricted cash of $53,355 relating to the posting of a cash collateralized bond related to the Loral contract dispute and $318 of other net cash payments. The 2006 investing activities consisted of a $3,912 refund from a supplier and $101 of other net cash receipts.

The net increase in cash classified as assets held for sale was $24,461 and $15,401 for the nine months ended September 30, 2007 and 2006, respectively.

74

Liquidity and Capital Resources

Overview

Cablevision has no operations independent of its subsidiaries. Cablevision’s outstanding securities consist of Cablevision NY Group Class A and Cablevision NY Group Class B common stock and $1,500,000 of debt securities. Funding for the debt service requirements of our debt securities is provided by our subsidiaries’ operations, principally CSC Holdings, as permitted by the covenants governing CSC Holdings’ credit agreements and public debt securities. Funding for our subsidiaries is generally provided by cash flow from operations, cash on hand, and borrowings under bank credit facilities made available to the Restricted Group (as later defined) and to Rainbow National Services LLC (“RNS”) and the proceeds from the issuance of notes and debentures in the capital markets. The Company has accessed the debt markets for significant amounts of capital in the past and may do so in the future.

The following table summarizes our outstanding debt and capital lease obligations as well as interest expense and capital expenditures as of and for the nine months ended September 30, 2007:

	Cablevision		Restricted Group		Rainbow National Services		Other Entities		Total
Bank debt	$	—	$	4,431,250	$	500,000	$	—	$	4,931,250
Capital leases	—		—		9,624		48,638		58,262
Notes payable	—		1,017		—		—		1,017
Senior notes and debentures	1,500,000		4,196,175		298,678		—		5,994,853
Senior subordinated notes and debentures	—		—		323,247		—		323,247
Collateralized indebtedness relating to stock monetizations	—		—		—		840,096		840,096
Total debt	$	1,500,000	$	8,628,442	$	1,131,549	$	888,734	$	12,148,725
Interest expense	$	100,915	$	492,906	$	86,810	$	33,706	$	714,337
Capital expenditures	$	—	$	514,556	$	3,212	$	36,603	$	554,371

Restricted Group

As of September 30, 2007, CSC Holdings and those of its subsidiaries which conduct our cable television video operations (including approximately 3.1 million basic video customers and 2.6 million digital video customers) and high-speed data service (which encompasses approximately 2.2 million customers) and our residential voice services operations (which encompasses approximately 1.5 million customers), as well as Optimum Lightpath, our commercial data and voice service business comprise the “Restricted Group” since they are subject to the covenants and restrictions of the credit facility and the indentures governing the notes and debentures securities issued by CSC Holdings. In addition, the Restricted Group is also subject to the covenants of the debt issued by Cablevision.

Sources of cash for the Restricted Group include primarily cash flow from the operations of the businesses in the Restricted Group, borrowings under its bank credit agreement and issuance of notes and debentures in the capital markets and, from time to time, distributions or loans from its subsidiaries. The Restricted Group’s principal uses of cash include capital spending, in particular the capital requirements associated with the growth of its services such as digital video, high-speed data and voice; debt service, including distributions made to Cablevision to service interest expense on its debt securities; other

75

corporate expenses and changes in working capital; and investments that it may fund from time to time. We currently expect that the net funding and investment requirements of the Restricted Group will be met with cash generated by its operating activities and borrowings under the Restricted Group’s bank credit facility and that the Restricted Group’s available borrowing capacity under that facility will be sufficient to meet these requirements for the next 12 months.

The Restricted Group’s credit facility consists of three components: a $1,000,000 revolver, a $1,000,000 term A-1 loan facility and a $3,500,000 term B loan facility. The three components of the Restricted Group credit facility are direct obligations of CSC Holdings, guaranteed by most Restricted Group subsidiaries and secured by the pledge of the stock of most Restricted Group subsidiaries. As of September 30, 2007, $56,494 of the $1,000,000 revolving credit facility was restricted for certain letters of credit issued on behalf of CSC Holdings and $943,506 of the revolver was undrawn. The revolving credit facility and the term A-1 loan facility mature in February 2012 and the term B loan facility matures in March 2013. The revolver has no required interim repayments. The $1,000,000 term A-1 loan facility requires quarterly repayments of $12,500 in 2007 and 2008, $62,500 in 2009 and 2010 and $100,000 in 2011. The $3,500,000 term B loan facility is subject to quarterly repayments of $8,750 that commenced June 30, 2006 through March 31, 2012 and $822,500 beginning on June 30, 2012 through its maturity date in March 2013. The weighted average interest rates as of September 30, 2007 on borrowings under the term A-1 loan facility and term B loan facility were 7.07% and 7.57%, respectively.

The principal financial covenants, which are not identical for the revolving credit facility and the term A-1 loan facility, on the one hand, and the term B loan facility, on the other, include (i) under the revolving credit facility and the term A-1 loan facility, maximum total leverage of 7.50 to 1 with subsequent stepdowns over the life of the revolving credit facility and the term A-1 loan facility until reaching 4.50 to 1 for periods beginning on and after January 1, 2010, (ii) under the revolving credit facility and the term A-1 loan facility, maximum senior secured leverage of 3.75 times cash flow through December 31, 2007 with annual stepdowns thereafter over the life of the revolving credit facility and the term A-1 loan facility until reaching 3.00 to 1 for periods beginning on and after January 1, 2010, (iii) under the revolving credit facility and the term A-1 loan facility, a minimum ratio for cash flow to interest expense of 2.00 to 1, and (iv) under the revolving credit facility and the term A-1 loan facility, a minimum ratio of cash flow less cash taxes to total debt expense (defined to include interest expense, certain payments of principal and dividends paid by CSC Holdings to Cablevision to permit Cablevision to pay interest and certain principal payments on its debt) of 1.50 to 1. These covenants and restrictions on the permitted use of borrowed funds in the revolving credit facility may limit our ability to utilize all of the undrawn revolver funds. Additional covenants include limitations on liens and the issuance of additional debt. Under the term B loan facility, we are limited in our ability to incur additional indebtedness based on a maximum ratio of total indebtedness to cash flow (as defined in the term B loan facility) of 7.50 to 1 with subsequent stepdowns over the life of the term B loan facility until reaching 5.00 to 1 for periods beginning on and after January 1, 2010 and a maximum senior secured leverage ratio of 4.50 times cash flow (as defined in the term B loan facility).

Under the revolving credit facility and the term A-1 loan facility, there are generally no restrictions on investments that the Restricted Group may make, provided it is not in default. The Restricted Group can make distributions or other restricted payments so long as CSC Holdings is not in default but there is a limitation (initially $200,000, subject to increase to reflect capital contributions or issuance of equity interests) on restricted payments during any period when the cash flow leverage ratio is greater than 6.00 to 1. The $200,000 limitation does not apply to restricted payments by CSC Holdings to Cablevision to be used by Cablevision to make scheduled payments of principal or interest on its indebtedness. Under the term B loan facility, there also are generally no restrictions on investments that the Restricted Group may make provided it is not in default; however, CSC Holdings must also remain in compliance with the maximum ratio of total indebtedness to cash flow and the maximum senior secured leverage ratio. Our

76

ability to make restricted payments is also limited by provisions in the term B loan facility and the indentures covering our notes and debentures.

CSC Holdings, a member of the Restricted Group, has issued senior notes and debentures, which also contain financial and other covenants, though they are generally less restrictive than the covenants contained in the Restricted Group’s bank credit facility. Principal covenants include a limitation on the incurrence of additional indebtedness based upon a maximum ratio of total indebtedness to cash flow (as defined in the indentures) of 9.00 to 1 and limitations on dividends and distributions. The indentures governing the Cablevision note and debenture issuances contain similar covenants and restrictions, including a limitation on additional debt incurrence based on a 9.00 to 1 debt to cash flow ratio. There are no covenants, events of default, borrowing conditions or other terms in the Restricted Group’s credit facility or in any of CSC Holdings’ or Cablevision’s other debt securities that are based on changes in the credit ratings assigned by any rating agency. The Restricted Group was in compliance with all of its financial covenants under its various credit agreements as of September 30, 2007.

Cablevision’s and CSC Holdings’ future access to the debt markets and the cost of any future debt issuances are also influenced by their credit ratings, which are provided by Moody’s Investors Service and Standard & Poor’s. Key factors in the assessment of Cablevision’s and CSC Holdings’ credit ratings include Cablevision and CSC Holdings’ financial strength and flexibility, operating capabilities, management risk tolerance and ability to respond to changes in the competitive landscape. The corporate credit rating for Cablevision and CSC Holdings is B1 by Moody’s with a developing outlook and BB by Standard & Poor’s with ratings on creditwatch with negative implications. Any future downgrade to the Cablevision and/or CSC Holdings credit ratings by either rating agency could increase the interest rate on future debt issuances and could adversely impact our ability to raise additional funds.

Rainbow and Rainbow National Services

RNS, our wholly-owned subsidiary which owns the common equity interests in the Company’s AMC, WE tv and IFC programming operations, generated positive cash from operating activities in 2006 and for the nine month period ended September 30, 2007. Its cash on hand, plus cash flow from operations and proceeds from borrowings available to it, provides the capital required for net funding and investment requirements of other Rainbow programming entities including the VOOM HD Networks, News 12 Networks and fuse subject to the applicable covenants and limitations contained in RNS’ financing agreements.

RNS has an $800,000 senior secured credit facility (the “RNS Credit Facility”), which consists of a $500,000 term A loan facility and a $300,000 revolving credit facility. The term A loan facility matures June 30, 2013 and the revolving credit facility matures June 30, 2012. The RNS Credit Facility allows RNS to utilize up to $50,000 of the revolving credit facility for letters of credit and up to $5,000 for a swing loan. Further, the RNS Credit Facility provides for an incremental facility of up to a maximum of $925,000, provided that it be for a minimum amount of $100,000. If an incremental facility is established, RNS and the lenders will enter into a supplement to the RNS Credit Facility with terms and conditions that are no more restrictive than those in the RNS Credit Facility. There are no commitments from the lenders to fund the incremental facility.

Outstanding borrowings under the term loan at September 30, 2007 were $500,000. There were no borrowings outstanding under the $300,000 revolving credit facility at September 30, 2007. The borrowings under the RNS Credit Facility may be repaid without penalty at any time. RNS may use future borrowings under the RNS Credit Facility to make investments, distributions, and other payments permitted under the RNS Credit Facility and for general corporate purposes.

77

Borrowings under the RNS Credit Facility are direct obligations of RNS which are guaranteed jointly and severally by substantially all of its subsidiaries and by RPH, the direct parent of RNS, and are secured by the pledge of the stock of RNS and substantially all of its subsidiaries, and all of the other assets of RNS and substantially all of its subsidiaries (subject to certain limited exceptions). At September 30, 2007, the interest rate on the term A loan facility was 7.07%. The term A loan is to be repaid in quarterly installments of $6,250 from March 31, 2008 until December 31, 2010, $12,500 from March 31, 2011 until December 31, 2012, and $162,500 on March 31, 2013 and June 30, 2013, the maturity of the term A loan. Any amounts outstanding under the revolving credit facility are due at maturity on June 30, 2012.

As defined in the RNS Credit Facility, the financial covenants consist of (i) a minimum ratio of operating cash flow to total interest expense for each quarter of 1.75 to 1, (ii) a maximum cash flow ratio of total indebtedness to annualized operating cash flow of 6.75 to 1 through June 30, 2008, decreasing thereafter to 6.25 to 1, and (iii) a maximum senior secured leverage ratio of senior secured debt to annualized operating cash flow of 5.50 to 1. Additional covenants include restrictions on indebtedness, guarantees, liens, investments, dividends and distributions and transactions with affiliates.

On July 24, 2007, RNS entered into an equity commitment agreement with its sole member, RPH, pursuant to which RPH agreed to purchase additional membership interests in RNS for an aggregate purchase price of $203,000. RNS used the proceeds of the investment by RPH to redeem $175,000 in aggregate principal amount of its 10-3/8% senior subordinated notes due 2014, representing 35% of the outstanding notes, at a redemption price equal to 110.375% of the principal amount of the notes plus accrued and unpaid interest to August 31, 2007, the redemption date. In connection with the redemption, the Company recognized a loss on extinguishment of debt of $19,113, representing primarily the redemption premium, and the write-off of the related unamortized deferred financing costs of $2,919. This redemption reduced the notes RNS had outstanding as of September 30, 2007 to $325,000 principal amount of 10-3/8% senior subordinated notes due September 1, 2014 and $300,000 principal amount of 8-3/4% senior notes due September 1, 2012. These notes are guaranteed by substantially all of RNS’ subsidiaries.

RNS was in compliance with all of its financial covenants under its various credit agreements as of September 30, 2007.

In April 2005, subsidiaries of the Company entered into agreements with EchoStar relating to the launch and operation of the business of Rainbow HD Holdings LLC, the Company’s VOOM HD Networks high definition television programming service, subject to the closing of the sale of our satellite (Rainbow 1) to EchoStar which occurred in November 2005. Under those arrangements, EchoStar initially distributed in 2005 a portion (10 of 21 channels) of the VOOM HD Networks programming service and, beginning in 2006, began carrying all 15 of the channels then included in the programming service. In connection with the arrangements, EchoStar was issued a 20% interest in Rainbow HD Holdings, the Company’s subsidiary owning the VOOM HD Networks, and that 20% interest will not be diluted until $500,000 in cash has been invested in Rainbow HD Holdings’ equity by the Company.

Under the terms of the affiliation arrangements with EchoStar covering the VOOM HD Networks for a 15 year term, if Rainbow HD Holdings fails to spend $100,000 per year (subject to reduction to reflect permanent reductions in the number of channels constituting the VOOM HD service), up to a maximum of $500,000 in the aggregate, on its service offerings, EchoStar may terminate the affiliation agreement. Echostar has exercised its audit rights under the affiliation agreement to determine whether Rainbow HD Holdings is in compliance with these requirements. The Company has the right to terminate the affiliation agreement if the VOOM HD Networks are discontinued in the future.

78

RNS’ future access to the debt markets and the cost of any future debt issuances are also influenced by its credit ratings, which are provided by Moody’s Investors Service and Standard & Poor’s. Key factors in the assessment of RNS’ credit ratings include its free cash flow generating capacity, fiscal strategy, enterprise value and industry risk. The corporate credit rating for RNS is B1 by Moody’s with a developing outlook and BB by Standard & Poor’s with ratings on creditwatch with negative implications. Any future downgrade to the RNS credit ratings by either rating agency could increase the interest rate on future debt issuances and could adversely impact its ability to raise additional funds.

Madison Square Garden

Madison Square Garden does not have a credit facility at this time. We currently expect Madison Square Garden’s funding requirements for the next twelve months to be met by its cash on hand and cash from operations.

During the fourth quarter of 2004, the Company announced its intent to renovate the MSG Arena. Although management of the Company is committed to this renovation project, another alternative, which would involve construction of a new arena on the site of the Farley post office, is also being pursued. A substantial renovation or relocation of the Arena would require significant funding.

Monetization Contract Maturities

For the nine months ended September 30, 2007, monetization contracts covering 3,724,460 shares of our Charter Communications and 800,000 shares of our Leapfrog stock matured. We settled our obligations under the related Charter Communications and Leapfrog collateralized indebtedness by delivering an equivalent number of Charter Communications and Leapfrog shares and the related equity derivative contracts.

During the next twelve months, monetization contracts covering 8,069,934 shares of Comcast Corporation mature. The Company intends to either settle such transactions by delivering shares of the applicable stock and the related equity derivative contracts or by delivering cash from the net proceeds of a new monetization transaction.

Managing our Interest Rate and Equity Price Risk

Interest Rate Risk

To manage interest rate risk, we have entered into interest rate swap contracts to adjust the proportion of total debt that is subject to variable and fixed interest rates. Such contracts effectively fix the borrowing rates on floating rate debt to provide an economic hedge against the risk of rising rates and/or effectively convert fixed rate borrowings to variable rates to permit the Company to realize lower interest expense in a declining interest rate environment. We do not enter into interest rate swap contracts for speculative or trading purposes and have only entered into transactions with counterparties that are rated investment grade.

All of our interest rate derivative contracts are entered into by CSC Holdings and are thus attributable to the Restricted Group; all such contracts are carried at their fair market values on our consolidated balance sheets, with changes in value reflected in the consolidated statements of operations.

79

Equity Price Risk

We have entered into derivative contracts to hedge our equity price risk and monetize the value of our shares of Comcast and General Electric. These contracts, at maturity, are expected to offset declines in the fair value of these securities below the hedge price per share while allowing us to retain upside appreciation from the hedge price per share to the relevant cap price. If any one of these contracts is terminated prior to its scheduled maturity date due to the occurrence of an event specified in the contract, we would be obligated to repay the fair value of the collateralized indebtedness less the sum of the fair values of the underlying stock and equity collar, calculated at the termination date. As of September 30, 2007, we did not have an early termination shortfall relating to any of these contracts. The underlying stock and the equity collars are carried at fair market value on our consolidated balance sheets and the collateralized indebtedness is carried at its accreted value.

See “Item 3 - Quantitative and Qualitative Disclosures About Market Risk” for information on how we participate in changes in the market price of the stocks underlying these derivative contracts.

All of our monetization transactions are obligations of our wholly-owned subsidiaries that are not part of the Restricted Group; however, in certain of the Comcast transactions, CSC Holdings provided guarantees of the subsidiaries’ ongoing contract payment expense obligations and potential payments that could be due as a result of an early termination event (as defined in the agreements). The guarantee exposure approximates the net sum of the fair value of the collateralized indebtedness less the sum of the fair values of the underlying stock and the equity collar. All of our equity derivative contracts are carried at their current fair market value on our consolidated balance sheets with changes in value reflected in the consolidated statements of operations, and all of the counterparties to such transactions currently carry investment grade credit ratings.

Recent Events

In June 2007, Rainbow Media Holdings completed its sale to Comcast of (i) its 60% interest in Fox Sports Net Bay Area, for a purchase price of $366,750 (the “Bay Area Sale”) and (ii) its 50% interest in Fox Sports Net New England, for a purchase price of $203,250 (the “New England Sale”), for an aggregate purchase price of $570,000, plus certain additional consideration to Rainbow Media Holdings, subject to customary working capital adjustments.

The Company recorded a pretax gain of $183,270 ($108,276, net of taxes) in connection with the New England Sale and a pretax gain of $317,846 ($187,784, net of taxes), relating to the Bay Area Sale. The net operating results of Fox Sports Net Bay Area have been classified as discontinued operations for all periods presented. The net operating results of Fox Sports Net Bay Area were previously reported in the Rainbow segment.

Contemporaneously with the execution of the agreement relating to the Bay Area Sale and the New England Sale, subsidiaries of the Company and Comcast entered into or extended affiliation agreements relating to (i) the carriage of the Versus and Golf Channel programming services on the Company’s cable television systems and (ii) the carriage of AMC, fuse, IFC, WE tv, Lifeskool, sportskool, MSG and Fox Sports Net New York on Comcast’s cable television systems.

On July 24, 2007, RNS entered into an equity commitment agreement with its sole member, RPH, pursuant to which RPH agreed to purchase additional membership interests in RNS for an aggregate purchase price of $203,000. RNS used the proceeds of the investment by RPH to redeem $175,000 in aggregate principal amount of its 10-3/8% senior subordinated notes due 2014, representing 35% of the outstanding notes, at a redemption price equal to 110.375% of the principal amount of the notes

80

plus accrued and unpaid interest to August 31, 2007, the redemption date. In connection with the redemption, the Company recognized a loss on extinguishment of debt of $19,113, representing primarily the redemption premium, and the write-off of the related unamortized deferred financing costs of $2,919.

Commitments and Contingencies

As of September 30, 2007, the Company’s commitments and contingencies for continuing operations not reflected on the Company’s consolidated balance sheet decreased $663,000 to approximately $5,465,000 as compared to $6,128,000 outstanding at December 31, 2006. The decrease relates primarily to (i) sports programming rights relating to Fox Sports Net Bay Area that were transferred to Comcast in connection with the sale of Fox Sports Net Bay Area,  (ii) the decrease of programming commitment obligations relating to the expiration of certain programming agreements, and (iii) payments made during the nine months ended September 30, 2007 on outstanding commitments.

Proposed Dolan Family Group Transaction

On May 2, 2007, Cablevision entered into a merger agreement with Central Park Holding Company, LLC (“Dolan Family Acquisition Company”), an entity owned by the Dolan Family Group, and Central Park Merger Sub, Inc. The terms of the merger agreement provided that Central Park Merger Sub, Inc. would be merged with and into Cablevision and, as a result, Cablevision would continue as the surviving corporation and a wholly-owned subsidiary of Dolan Family Acquisition Company (the “Proposed Merger”).

On October 24, 2007, the Proposed Merger was submitted to a vote of Cablevision’s shareholders and did not receive shareholder approval. Subsequently, the parties terminated the merger agreement pursuant to its terms.

Recently Issued Accounting Pronouncements Not Yet Adopted

In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 157, Fair Value Measurements (“Statement No. 157”). Statement No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. Under Statement No. 157, fair value refers to the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the reporting entity transacts. It also clarifies the principle that fair value should be based on the assumptions market participants would use when pricing the asset or liability. This Statement applies under other accounting pronouncements that require or permit fair value measurements. Accordingly, this Statement does not require any new fair value measurements, however, for some entities, the application of Statement No. 157 could change current practices. Statement No. 157 will be effective for financial statements issued with fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Company has not yet determined the impact that the adoption of Statement No. 157 will have on its financial statements.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities - Including an amendment of FASB Statement No. 115 (“Statement No. 159”). Statement No. 159 permits entities to elect, at specified election dates, to measure eligible financial instruments and certain other items at fair value. An entity shall report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date, and recognize upfront costs and fees related to those items in earnings as incurred. Statement No. 159 is effective as of January 1, 2008 for the Company. Early adoption is permitted, but an entity is prohibited from retrospectively applying Statement No. 159, unless it chooses early adoption of Statement No. 157

81

and Statement No. 159. Statement No. 159 also applies to eligible items existing at January 1, 2008 (or when the date of early adoption occurs). The Company has not yet determined the impact that the adoption of Statement No. 159 will have on its financial statements.

Item 3.Quantitative and Qualitative Disclosures About Market Risk

All dollar amounts, except per subscriber, per unit and per share data, included in the following discussion under this Item 3 are presented in thousands.

Equity Price Risk

The Company is exposed to market risks from changes in certain equity security prices. Our exposure to changes in equity security prices stems primarily from the shares of Comcast Corporation and General Electric Company common stock held by us. We have entered into prepaid forward contracts consisting of a collateralized loan and an equity collar to hedge our equity price risk and to monetize the value of these securities. These contracts, at maturity, are expected to offset declines in the fair value of these securities below the hedge price per share while allowing us to retain upside appreciation from the hedge price per share to the relevant cap price. The contracts’ actual hedge prices per share vary depending on average stock prices in effect at the time the contracts were executed. The contracts’ actual cap prices vary depending on the maturity and terms of each contract, among other factors. If any one of these contracts is terminated prior to its scheduled maturity date due to the occurrence of an event specified in the contract, we would be obligated to repay the fair value of the collateralized indebtedness less the sum of the fair values of the underlying stock and equity collar, calculated at the termination date. The following table details our estimated early termination exposure as of September 30, 2007:

	Comcast			General Electric			Total
Collateralized indebtedness (carrying value)	$	(440,879	)	$	(399,217	)	$	(840,096	)
Collateralized indebtedness (fair value estimate)	$	(437,702	)	$	(391,853	)	$	(829,555	)
Derivative contract	(27,188		)	(75,137		)	(102,325		)
Fair value of investment securities pledged as collateral	519,328			527,520			1,046,848
Net excess (shortfall)	$	54,438		$	60,530		$	114,968

The underlying stock and the equity collars are carried at fair market value on our consolidated balance sheets and the collateralized indebtedness is carried at its accreted value. The carrying value of our collateralized indebtedness amounted to $840,096 at September 30, 2007. At maturity, the contracts provide for the option to deliver cash or shares of Comcast or General Electric common stock (as the case may be), with a value determined by reference to the applicable stock price at maturity.

As of September 30, 2007, the fair value and the carrying value of our holdings of Comcast and General Electric common stock aggregated to $1,046,848. Assuming a 10% change in price, the potential change in the fair value of these investments would be approximately $104,685. As of September 30, 2007, the net fair value and the carrying value of the equity collar component of the prepaid forward contracts entered into to hedge the equity price risk of certain of these securities aggregated $102,325 a net payable position. For the nine months ended September 30, 2007, we recorded a net gain on all outstanding equity derivative contracts of $61,225. We also recorded an unrealized and realized loss on our holdings of the underlying stocks of $31,434 for the nine months ended September 30, 2007.

82

Fair Market Value of Equity Derivative Contracts

Fair market value as of December 31, 2006	$	(82,009	)
Change in fair value	61,225
Maturity of contracts	(81,541		)
Fair market value as of September 30, 2007	$	(102,325	)

In addition, at September 30, 2007, the Company had other investment securities with a carrying value of approximately $11,452. Assuming a 10% change in the price of the securities, the potential change in the fair value of these investments would be approximately $1,145.

The maturity, number of shares deliverable at the relevant maturity, hedge price per share, and the lowest and highest cap prices received for each security monetized via a prepaid forward contract are summarized in the following table:

	# of Shares		Hedge Price	Cap Price (b)
Security	Deliverable	Maturity	per Share (a)	Low		High
Comcast (c)	10,738,809	2008	$17.80 - $27.49	$	22.38	$	32.99
	10,738,809	2009
General Electric	12,742,033	2009	$32.52 - $34.14	$	39.03	$	40.96

(a)Represents the price below which we are provided with downside protection and above which we retain upside appreciation. Also represents the price used in determining the cash proceeds payable to us at inception of the contracts.

(b)Represents the price up to which we receive the benefit of stock price appreciation.

(c)Reflects the 3 for 2 stock split on February 22, 2007.

Fair Value of Debt:  Based on the level of interest rates prevailing at September 30, 2007, the carrying value of our fixed rate debt of $6,540,817 exceeded its fair value of $6,498,123 by $42,694. The fair value of these financial instruments is estimated based on reference to quoted market prices for these or comparable securities. Our floating rate borrowings bear interest in reference to current LIBOR-based market rates and thus approximate fair value. The effect of a hypothetical 100 basis point decrease in interest rates prevailing at September 30, 2007 would increase the estimated fair value of our fixed rate debt by $183,131 to $6,681,254. This estimate is based on the assumption of an immediate and parallel shift in interest rates across all maturities.

Interest Rate Derivative Contracts:  Our exposure to interest rate movements results from our use of floating and fixed rate debt to fund the approximately $3 billion special dividend paid in 2006, our working capital, capital expenditures, and other operational and investment requirements. To manage interest rate risk, from time to time we have entered into interest rate swap contracts to adjust the proportion of total debt that is subject to variable and fixed interest rates. Such contracts effectively fix the borrowing rates on floating rate debt to provide an economic hedge against the risk of rising rates and/or effectively convert fixed rate borrowings to variable rates to permit the Company to realize lower interest expense in a declining interest rate environment. In addition, from time to time we may utilize short-term interest rate lock agreements to hedge the risk that the cost of a future issuance of fixed rate debt may be adversely affected by changes in interest rates. We do not enter into interest rate swap contracts for speculative or trading purposes. All of our interest rate derivative contracts are entered into by CSC Holdings and are thus attributable to the Restricted Group; all such contracts are carried at their fair market values on our consolidated balance sheets, with changes in fair market value reflected in the consolidated statements of operations.

As of September 30, 2007, we had outstanding interest rate swap contracts to convert fixed rate debt to floating rate debt covering a total notional principal amount of $450,000. As of September 30, 2007, the

83

fair market value and carrying value of these interest rate swap contracts was $2,482, a net liability position, as reflected under derivative contracts in our consolidated balance sheet. Assuming an immediate and parallel shift in interest rates across the yield curve, a 100 basis point increase in interest rates from September 30, 2007 prevailing levels would increase the fair value of these contracts to a net liability of $4,779.

As of September 30, 2007, we also had outstanding interest rate swap contracts in the notional amount of $3,700,000 to effectively fix borrowing rates on floating rate debt. As of September 30, 2007, these interest rate swap contracts had a fair market value and carrying value of $57,270, a net liability position, as reflected under derivative contracts in our consolidated balance sheet. Assuming an immediate and parallel shift in interest rates across the yield curve, a 100 basis point decrease in interest rates prevailing at September 30, 2007 would increase our liability under these derivative contracts by approximately $74,198 to a liability of $131,468.

For the nine months ended September 30, 2007, we recorded a net loss on interest swap contracts of $24,459, as detailed in the table below:

Fair Market Value of Interest Rate Derivative Contracts

Fair market value as of September 30, 2007, a net payable position	$	(59,752	)
Less: fair market value as of December 31, 2006	(37,966		)
Change in fair market value, net	(21,786		)
Plus: realized loss from cash interest payments	(2,673		)
Net loss on interest rate swap contracts	$	(24,459	)

At September 30, 2007, the Company had outstanding prepaid interest rate swaps with a notional contract value of approximately $105,061 entered into in connection with our monetization transactions. These swaps have maturities in 2008 and 2009 that coincide with the related prepaid equity forward maturities. As of September 30, 2007, the fair value of our prepaid interest rate derivative contracts was $6,430, a net liability position. Assuming an immediate and parallel shift in interest rates across the yield curve, a 100 basis point increase in interest rates from September 30, 2007 prevailing levels would increase our liability under these derivative contracts by $368 to a liability of $6,798.

For the nine months ended September 30, 2007, we recorded a net gain on such derivative contracts of $321 as detailed below:

Fair Market Value of Prepaid Interest Rate Derivative Contracts

(dollars in thousands)

Fair market value as of December 31, 2006	$	(10,340	)
Change in fair market value, net	3,909
Fair market value as of September 30, 2007	$	(6,431	)
Change in fair market value, net	$	3,909
Realized loss resulting from net cash payments	(3,588		)
Net gain on prepaid interest rate swap contracts	$	321

84

Item 4.                    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

An evaluation was carried out under the supervision and with the participation of Cablevision’s management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined under Securities and Exchange Commission rules). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2007.

Changes in Internal Control

During the quarter ended September 30, 2007, there were no changes in the Company’s internal control over financial reporting that materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.Legal Proceedings

Refer to Note 14 to Cablevision’s condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for a discussion of our legal proceedings.

Item 1A.Risk Factors

Our Annual Report on Form 10-K for the year ended December 31, 2006 includes “Risk Factors” under Item 1A of Part I. The following discussion is intended to update certain matters discussed in “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2006 and our Quarterly Reports on Form 10-Q for the three months ended March 31, 2007 filed on May 10, 2007 and the three months ended June 30, 2007 filed on August 8, 2007.

Pending FCC, Congressional and judicial proceedings

Franchising Requirements.  The Connecticut Department of Public Utility Control has granted AT&T a certificate of video franchise authority to provide video service throughout AT&T’s Connecticut footprint.  Whether AT&T will be allowed to operate solely under the video service franchise or must also adhere to traditional cable regulation is the subject of litigation in federal court.  We cannot predict the outcome of this litigation or its effect on the Company.

Must-Carry/Retransmission Consent. On September 11, 2007, the Federal Communications Commission adopted rules, which will remain in effect at least until February 2012, that require cable operators to make local broadcasters’ primary video and program-related material viewable on subscribers’ analog and digital television sets, which could include transmitting the local digital broadcast signals in analog as well as digital format or providing subscribers with the necessary equipment to view a digital signal on an analog set. We cannot predict the impact of these rules or their effect on the Company.

Program Access. On September 11, 2007, the Federal Communications Commission adopted a  Report & Order that extends the ban of exclusive contracts between vertically integrated programmers and cable operators to October 5, 2012. It had been set to expire on October 5, 2007. The extension has been challenged in federal court. The FCC also adopted a Notice of Proposed Rulemaking (NPRM) seeking

85

comment on revisions to the program access complaint procedures; whether cable programming networks require programming distributors to purchase and carry undesired programming in return for the right to carry desired programming and whether such arrangements should be prohibited; and whether it would be appropriate to extend the Commission’s program access rules, including the exclusive contract prohibition, to terrestrially delivered cable-affiliated programming and programming delivered in high definition format. We cannot predict the result of this proceeding or its effect on the Company or Rainbow.

Program Carriage/Leased Access. In June 2007, the FCC released a notice of proposed rulemaking considering changes to its program carriage rules, which govern disputes between programmers and distributors over carriage terms. The FCC also sought comment on changes to its leased access rules, which govern the leasing of channels by unaffiliated programmers, including whether changes need to be made to the rules governing response to requests for leased access, whether the rate for leased access is appropriate, and any ways that advances in technology or marketplace developments should affect the leased access rules. We cannot predict how the FCC will rule on these issues or how such a ruling might affect Cablevision.

CPNI. In April 2007, the FCC sought comment on proposals for additional protections that might be applied to customer proprietary network information (“CPNI”) for both telecommunications carriers and interconnected VoIP service providers. We cannot predict how the FCC may rule on these matters. Any changes to rules on protection of CPNI may affect the financial results for Optimum Lightpath and Optimum Voice.

Universal Service. In June 2007, a federal appeals court upheld the FCC order requiring federal universal service contributions from interconnected VoIP service providers. Questions remain about state jurisdiction to assess contributions on VoIP service providers for state universal service programs. Any changes to the assessment and recovery rules for universal service may affect Optimum Lightpath’s, Optimum Voice’s, and Optimum Online’s financial results.

Item 2.                    Unregistered Sales of Equity Securities and Use of Proceeds

The table below sets forth information regarding purchases made by the Company of its Class A Common Stock during the three months ended September 30, 2007.

	(a) Total Number of  Shares (or Units)  Purchased	(b)  Average Price  Paid per Share  (or Unit)	(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
August 1-31, 2007	15,457	32.36	N/A	N/A

In August 2007, 35,000 restricted shares issued to an employee of the Company vested. To fulfill the employee’s statutory minimum tax withholding obligations of $500,189 for the applicable income and other employment taxes, 15,457 of these shares were surrendered to the Company. The 15,457 acquired shares have been classified as treasury stock.

86

Item 4.                    Submission of Matters to a Vote of Security Holders

A Special Meeting of Stockholders was held on October 24, 2007 for shareholders to consider and vote upon a proposal to adopt and approve the Agreement and Plan of Merger, dated as of May 2, 2007 by and among the Company and an entity organized by certain members and affiliates of the Dolan family. The following are the results of the matters voted upon at this meeting:

To adopt and approve the Agreement and Plan of Merger, dated as of May 2, 2007, by and among Central Park Holding Company, LLC, Central Park Merger Sub, Inc. and Cablevision Systems Corporation as it may be amended from time to time, which, among other things, provides for the merger of Central Park Merger Sub, Inc. with and into Cablevision Systems Corporation, with Cablevision Systems Corporation continuing as the surviving corporation.

Class A Shareholders
For:	70,625,740
Against:	116,487,501
Abstain:	762,338

Class B Shareholders
For:	557,756,520
Against:	—
Abstain:	—

To approve an amendment to Cablevision Systems Corporation’s Amended and Restated Certificate of Incorporation, to make Section A.X. of Article Fourth, which provides that holders of each class of Cablevision common stock must receive identical consideration upon a merger of Cablevision Systems Corporation, inapplicable to the merger and the other transactions contemplated by the merger agreement.

Class A Shareholders
For:	87,663,239
Against:	99,452,586
Abstain:	759,754

Class B Shareholders
For:	557,756,520
Against:	—
Abstain:	—

87

To approve any motion to adjourn the special meeting to a later date to solicit additional proxies if there are insufficient votes at the time of the special meeting to approve Proposal 1 or Proposal 2.

Class A Shareholders
For:	85,575,281
Against:	101,527,968
Abstain:	772,330

Class B Shareholders
For:	154,318,480
Against:	403,438,040
Abstain:	—

Item 6.Exhibits

(a)           Index to Exhibits.

31.1	Section 302 Certification of the CEO
31.2	Section 302 Certification of the CFO
32	Section 906 Certification of the CEO and CFO

88

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.

		CABLEVISION SYSTEMS CORPORATION
		CSC HOLDINGS, INC.
Date:	November 8, 2007		/s/ Michael P. Huseby
		By:	Michael P. Huseby as Executive Vice President and Chief Financial Officer of Cablevision Systems Corporation and CSC Holdings, Inc.
Date:	November 8, 2007	By:	/s/ Wm. Keith Harper
			Wm. Keith Harper as Senior Vice President and Controller and Principal Accounting Officer of Cablevision Systems Corporation and CSC Holdings, Inc.

89