Specialty channels are more entertaining and useful to viewers, more affordable for advertisers, and are continuing to eclipse network TV in both Canada and the U.S., according to recent studies and ratings. But this season will be make-or-break for many of this country’s newest channels, say pundits, as digital specialties enter their third broadcast year and are expected to finally turn the corner towards profitability.

‘That’s certainly always been our plan… that there would be some payback this year,’ says CTV president Rick Brace. CTV has seen ‘modest growth’ at some of its digichannels – which include Animal Planet, Discovery Civilization and CTV Travel – but killed one, WTSN, earlier this fall. Corus-owned EdgeTV folded in June and many smaller channels, PrideVisionTV and i channel, for example, are thought to be struggling.

Many expected digitals to die off en masse shortly after their debuts in 2001, but despite a general lack of subscribers and ad dollars, the channels have stayed in business, if not in the black, by keeping costs down. But industry watchers say time and money will run out for more digis in ’03/04. The next to go will be those saddled with both low subscriber numbers and high production costs, says Alliance Atlantis Broadcasting CEO Phyllis Yaffe.

‘No one wants to be first,’ says Loren Mawhinney, VP of Canadian production at Global TV. ‘But I think when a few more go there will be a tumbling effect.’