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Our channel group had another year of strong growth, driven by both organic expansion of our existing channels and new launches. Distribution increased in all existing markets as well as through new launches, with subscribers up 25% from 19.9 million to 24.9 million as at June 30, 2001. Following our recent launches in Germany, Hungary, the Middle East and Israel, Fox Kids has become the most widely distributed children’s channel in Europe and the Middle East, reaching more than 25 million households in 54 markets, with a local service in every major market.

Tactical programming acquisitions coupled with increased participation in European co-production activity were instrumental in achieving another strong year of increase in audience share. Fox Kids channels consolidated market leadership amongst their target audience in France, the Netherlands, Scandinavia, Spain and Poland, representing five out of the six markets where independent ratings data is available. In the UK, our channel was ranked third among the other pay-TV children’s channels but has been showing consistent ratings improvement in the growing universe of Sky Digital homes among children 4-9 and children 4-15.

Our German channel launched successfully in October 2000 on the Premiere World pay-TV platform, broadcasting between 6am and 10pm every day. This channel has also been well received and ranked as the favourite channel amongst children 6-13 in Premiere World households according to research conducted in July 2001 by NFO Infratest.

Our Central & Eastern European coverage was extended by adding a Hungarian channel in November 2000 on UPC’s newly developed digital satellite platform, UPC Direct. This channel was subsequently extended with a Czech language feed to cover the Czech Republic and Slovakia in February 2001.

Also in November 2000, we launched a new channel service for the Middle East (excluding Israel) via the Star Select bouquet, available exclusively on the Orbit satellite platform. The geographical coverage of this channel includes Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Syria, the United Arab Emirates and Yemen.

In February 2001, through a joint venture with Middle East Communication Holdings B.V., an entity controlled by children’s programme distributor Arieh Saban, we launched a fully localised channel for Israel on Tevel Digital cable systems. Distribution of this channel was subsequently extended to the other cable operators in the market, Golden Channels and Matav, followed by a launch in September 2001 on Yes, the local DTH satellite platform.

As at June 30, 2001, we had over 500 active distribution agreements with cable and satellite operators across Europe and the Middle East.

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($ millions)
Note (1): Unaudited results for the year ended May 31, 2001
Note (2): Including our share of revenues of unconsolidated joint ventures
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