With the better part of two seasons under their collective belt, only one of Canada’s 40-plus digital channels has been kicked off the island. In fact, a couple of them are even occasionally outdrawing the analogs in some primetime slots.

Their survival defies early predictions that several diginets launched in September 2001 would be extinct by now. The logic of the doomsayers was that relatively minuscule audiences and correspondingly lacklustre advertiser interest would naturally result in some of the digitals drowning in red ink, as happened earlier this month to EdgeTV.

Although none has yet boasted about being in the black, several of the top-15 channels – including DejaView, BBC Canada, Scream and Mystery – have doubled their average-minute audiences for viewers 18-plus since last year.

Sounds impressive, but good or bad, any diginet audience numbers should be taken with a grain of salt, says Jim Patterson, president and CEO of the Toronto-based Television Bureau of Canada.

‘I would say that they are still struggling to get big enough samples to measure the audiences accurately.’

The real story, says Janet Yale, president and CEO of the Canadian Cable Television Association, ‘is that digital penetration is now approaching 25%, which means that about 1.3 million households are now subscribing to digital channels.

‘That’s very much on track with our forecast at the outset, which was that we would see a slow build to about 1.8 million households by September 2003,’ she explains. ‘With three months to go [till then], we still think that may happen.’

That wouldn’t surprise Michael Allen, VP/GM at Toronto’s Rogers Cable, which has seen its digital subscribers jump by 33,100 in Q1 of 2003, bringing its total number of digital customers to 434,000 – or 42% of Rogers’ overall customer base.

Official confirmation of digital subscriptions ought to come from the CRTC, says Mario Mota, publisher and editor in chief of Ottawa-headquartered Decima Publishing, but the commission’s most recent report is nearly a year old.

‘However, our quarterly reports have shown modest subscription growth of about 5% on average, quarter over quarter. We expect to see a much clearer picture when the results of our research study of consumer attitudes regarding the digital channels is ready in July.’

Phyllis Yaffe, CEO of Alliance Atlantis Broadcasting, already knows that two of her company’s six diginets are kicking analog butt.

She says Alliance Atlantis’ Showcase Action not only ‘continues to be number one for adults 18 to 19 and 25 to 54, but has an average-minute audience in primetime that’s higher than five or six analog channels that have five million viewers.’

Meanwhile, CTV’s six diginets ‘have grown their average minute audiences by 71% between January-March ’02 and January-March ’03,’ according to Toronto’s Bart Yabsley, EVP of CTV Specialty Television.

How did they do it? Yabsley says CTV Travel is a prime example. ‘By having our [consumer] research team and our programming team work together closely, we came up with a fairly dramatic change. CTV Travel began as a how-to channel and it has now evolved into more of an escapist-entertainment [focus].’

And that, says the TVB’s Patterson, just goes to show that viewers are developing favorite diginets.

‘Probably no digital channel is actually replacing one of the main channels, but each of them is carving out its niche. And that’s exactly what the digitals promised – that they would not be ‘broadcasting’ channels, but niche channels.’

And thanks to research by the channel owners, those audiences are getting better defined by the month.

CanWest Global – which has three diginets among the top 15 this time around – wants media buyers to understand that its Mystery channel, for example, targets a key demographic of ‘older married females, middle income, without children at home, who spend a great deal of time and money on upgrading their residence and its contents and are concerned about health and nutrition.’

Similarly, DejaView watchers are described as ‘hard-working, middle-aged adults with families, employed in skilled occupations.’ Fox Sports viewers are ‘athletic males, residing in major markets, upper income and middle-aged with a propensity to drive imported automobiles.’

But despite this success at hyper-niching, media buyers such as Florence Ng, of Toronto Optimedia Canada, remain unimpressed.

‘If you group them all together, for the 18 to 49 [segment], they’re only slightly over 1% of total viewing. So if what your client wants is mass eyeballs, digitals are not the right vehicle.

‘However,’ Ng concedes, ‘if you want to be extremely specific in terms of target audience, and you want to do more than a brand sell – say, product integration, content or promotion – the appropriate digital channel can be the right vehicle.’

Another factor advertisers should consider, according to diginet reps, is the increasingly aggressive promotional activities they are undertaking. Showcase Action is leveraging ‘Arniemania’ for the July release of Schwarzenegger’s latest Terminator, T3: The Rise of the Machines.

Not only will the channel present a ‘Arnie Double Bill,’ but it is now in the midst of a national retail promotion with 850 RadioShack stores offering a free month of Showcase Action to those who purchase a Star Choice Satellite system – plus mail-ins for DVDs of T2: Extreme.

All in all, are the diginets maturing a little more quickly than was predicted? Wayne Sterloff, Calgary-based VP specialty at Craig Media, which owns TV Land, says yes.

‘The greatest trend I see… is a move by the audience to treat these ‘new specialty’ networks as conventional; that is, the audience has stopped sampling schedules and has moved to appointment viewing.’

Alliance Atlantis’ Yaffe echoes that optimistic opinion. ‘We don’t even call them ‘digital’ anymore. We just refer to them as ‘the new services’ because… if you’re an ExpressVu or Star Choice [satellite] subscriber, you don’t have analog and digital channels, you just have channels.’

The top 15 diginets

Channels are ranked by average-minute audience, adults 18-plus, during the weeks from Oct. 13, 2002 to May 5, 2003 inclusive. All audience data is from Toronto-based Nielsen Media Research. (Note: AA refers to average minute audience; share refers to Adult 18+ digital audience.)

Lonestar
AA: 10,600 (13.3% share)
Showcase Action
AA: 7,100 (8.9% share)
DejaView
AA: 4,500 (5.7% share)
Court TV Canada
AA: 4,300 (5.4% share)
BBC Canada
AA: 4,200 (5.3% share)
TV Land
AA: 4,100 (5.2% share)
Scream
AA: 3,800 (4.8% share)
Drive-In Classics
AA: 3,200 (4.0% share)
Mystery
AA: 3,200 (4.0% share)
Animal Planet
AA: 2,800 (3.5% share)
Discovery Civilization
AA: 2,700 (3.4% share)
SexTV: The Channel
AA: 2,600 (3.3% share)
Showcase Diva
AA: 2,300 (2.9% share)
Biography Channel
AA: 1,900 (2.4% share)
mentv
AA: 1,700 (2.1% share)