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Alliance Atlantis Turns Profit with Digital Cable Network

7:15 am on March 5, 2006 | Category: Business, Corporate, Telecom Services, Television

After almost five years in the digital cable industry, Alliance Atlantis Communications has brought its eight digital channels into profitable territory for the first time.

“When we first decided to launch our digital channels in 2001, we were confident that the digital realm was where future growth opportunities existed,” Ms. Yaffe said yesterday after announcing that the companyâ€™s TV division made $84.2 million in the fourth quarter. “These results provide the validity of this view.”

A major frustration for digital TV content providers is the lower advertising revenues, caused by the fact that digital television services still have less viewers than conventional networks. Narrowing the gap in this area has been a challenge for all companies in the industry, but Alliance Atlantis has had more than success than most.

The companyâ€™s holdings account for just 17% of the digital specialty cable channels in Canada, but they manage to bring in 48% of the total advertising revenue in that sector.

By tweaking the target demographics for its channels, and waiting for more users to switch over to digital set-top boxes, Alliance Atlantis believes that it can gradually boost its already solid profits and build a strong position in Canadaâ€™s media entertainment industry.

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