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by Richard Blackwell
The Globe and Mail
Jun 29, 2005
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Canada's cable and satellite television
businesses are booming, as Canadians spend more money to get their entertainment
fix at home.
The Canadian Radio-television and Telecommunications Commission reported
yesterday that revenue in the cable television business grew 9.4 per
cent in 2004, to $4.5-billion. Pretax profit more than doubled, to $567-million.
Satellite television's revenue growth was even stronger, up almost 13
per cent to $1.4-billion. But the satellite companies -- Star Choice
and Bell ExpressVu --are still losing money, showing pretax losses of
$162-million in 2004.
Still, that's an improvement from 2003, when the satellite providers
lost $211-million, and 2002, when the pretax red ink peaked at $423-million.
(The satellite numbers also include ground based "multipoint distribution
systems," a small and declining part of the television business.)
Despite the losses, satellite television is showing the greatest growth
in the number of users, according the CRTC statistics, with subscribers
up 5 per cent in 2004 to 2.3 million. Cable saw a 1 per cent growth
in the number of subscribers, to 6.6 million.
Kaan Yigit of Toronto research firm Solutions Research Group said the
cable companies' revenue growth is a result of a shift to selling higher-priced
services such as digital television and video-on-demand.
While there will be slower growth in digital television services this
year, he predicted, the market should "reignite" within the
next three years as digital decoder boxes become much cheaper.
In 2000, fewer than 10 per cent of homes had digital television service
-- either by cable or satellite -- but that number is now approaching
50 per cent.
Over all, "in-home entertainment is taking a larger share of Canadians'
leisure time and budgets," Mr. Yigit said, as people spend less
time at the movies and more in front of the small screen. |
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