Changes in the technology, regulation and economics of the communications industry over the past three decades have presented increasingly complex challenges and opportunities. The transmission of voice, data and video content has been dramatically altered by changes in wireline, wireless and IP technologies. Carriers, satellite operators and other infrastructure providers have each tried to balance the quality and cost of their respective technologies. Similarly, broadcasters and other content providers have strategically tried to leverage different technologies and infrastructure to enable the most effective content delivery.

Technological developments, particularly the massive deployment of satellite dishes and the transition to digital from analog cable, have prompted a rapid acceleration in the introduction of new broadcasters and have increasingly led broadcasters to target a global audience. Content providers are increasingly offering their programming on a global scale. Broadcasters who appeal to a niche market, such as speakers of a specific language, are now able to reach their target audience worldwide. These content providers rely upon networks with the ability to distribute across all continents in order to achieve global scale.

In the last decade, numerous new content providers have begun broadcasting. Competition between networks for audience and revenue dollars and competition between service providers for customers, as well as satellite providers\\\\\\\\\\\\\\\' offering local channels and localized content, are all catalysts for a larger number of channels becoming available. According to Euroconsult, the number of satellite television channels grew from approximately 1,000 in 1995 to more than 13,000 in 2005, and is expected to grow to more than 29,000 television channels by 2013. In 2003, there were 677 channels in the United States that targeted specific ethnic groups.

The Company is an innovative provider of comprehensive transmission services to the global broadcasting industry. The Company operates teleports that it owns and obtains additional teleport services under subcontract, to provide uplink, downlink and turnaround services including encryption, encoding, time delay and localization on both a continuous and occasional basis.

The Company transmits to 21 satellites and receives transmissions from 48 satellites. Broadcasters use the Company’s uplink services to transmit programming to a satellite, from which the programming is distributed either to a cable television headend (a cable television, or CATV, system control center that receives and processes signals for distribution to subscribers), to a satellite television facility or to Direct to Home consumers.

The Company’s downlink services involve the reception of a broadcast that is transmitted from a satellite to a teleport. The Company operates an array of more than 95 satellite dish antennas to receive broadcasts from Europe, North America, Africa, the Middle East and Asia. These services are available on a continuous basis, monitoring for special events.

Turnaround services involve the receipt and immediate re-transmission of broadcasts. This includes channel distribution and backhaul services, sports feeds, and other continuous and occasional feeds.

The Company provides continuous year-round global distribution services via satellites or terrestrial fiber optic on a full-time basis to more than 265 television and more than 80 radio channels. The Company’s principal teleport has more than 95 satellite dish antennas, ranging from 1.2 meters in diameter to 10.0 meters.

The Company’s satellite services provide transmission over C-band, Ku-band and Ka-band satellite transmissions. The Company’s uplink services cover every significant population center.

The Company operates an automated, high-capacity facility for content management services. The Company’s services enable the customers to easily expand the number of channels they broadcast. The Company offers its customers flexible packages, which it delivers with a high degree of redundancy and availability. The Company’s automated production and playout facilities offer a variety of value-added services.

Cost of revenues was $12.4 million for the six months ended June 30, 2006, an increase of 45.2%, from $8.6 million in the same period of 2005.

Sales and marketing expenses were $880,000 in the six months period ended June 30, 2006, a decrease of 6.5% from $940,000 in the same period of 2005.

Interest and marketable securities income was $83,000 in the six months period ended June 30, 2006, an increase of $27,000 from interest and marketable securities income of $55,000 in the same period of 2005.

Net income was $3.6 million in the six month period ended June 30, 2006, an increase of 115.6% from $1.7 million in the same period of 2005.