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PhotoChannel Network Usage Surges in latest Fiscal Quarter Jan. 11, 2005 -- PhotoChannel Networks Inc. (TSX-V: PNI and OTCBB: PHCHF) (“PhotoChannel” or “Company”), the global leader in digital imaging network technology, with over 8,000 photo retail locations worldwide, today reports the following: PhotoChannel Network Usage The use of the PhotoChannel Network by PhotoChannel's retailer and wireless carrier customers resulted in surging transactions for its first fiscal quarter of 2005 (the period October to December 2004). During the Company's 1 st quarter 2005, Network Fees processed increased by over 320% from the same quarter a year ago. This increase in the latest quarter's Network Fees processed was 97% higher then the Company's 4 th quarter of 2004 (the period July to September 2004), which is traditionally the strongest photofinishing quarter of the year for retailers. PhotoChannel will be reporting its financial results for fiscal 2004 and its 1 st quarter of 2005 on February 15, 2005. “All of the hard work the Company has put in over the last few years has started paying off,” stated Bart Copeland, President and CEO of PhotoChannel. “Network Fees based off of orders processed by our customers are increasing dramatically. At the same time as this growth has been occurring we have also been very busy launching many more in-store print locations within our existing and new retailer chains. As the sales of digital cameras reach ever new heights and PhotoChannel's customers increase their focus on marketing their online printing services, PhotoChannel is perfectly positioned for growth in fiscal 2005.” For more on the information in this release including additional metrics the Company is tracking, please check the online version of this update located on the Company website at www.photochannel.com/corpupdate . Customer Highlights The Company has recently signed and launched or is in the process of launching in excess of 2,000 new photo retail locations, bringing the total to over 8,000 locations now available on the PhotoChannel Network. These new retailers and wireless carriers include (parentheses denote status of each):
In-Store Deployment In the last several months the Company has connected over 250 new locations for direct-to-store printing. The Company's data shows that when in-store labs are connected directly to the PhotoChannel Network (as opposed to the order being sent to a central fulfillment site and delivered back to the store), orders have increased by as much as 400% in these locations over a six month period. The Company has no w connected 148 of Black's 155 locations in Canada, 60 Costco locations in the United States and is in the process of connecting another 100+ Wal-Mart Canada locations. Marketing Highlights One new service offered by PhotoChannel that is helping to fuel sales for PhotoChannel Network customers has been the adoption of PhotoChannel Marketing Services. From a standing start in January 2004, use of the PhotoChannel Advantage email marketing engine, reached almost 250,000 emails sent in the month of December 2004. This permission based email marketing is being conducted with a very targeted methodology, generating a large number of opt-in orders and interest from the retailers' customers. Additionally, more customers are contracting with PhotoChannel to deliver variable messaging throughout their sites. This messaging is in the form of such items as authorized pop-ups, product messaging inclusions in order response emails as well as many other areas of the site as defined by the retailer. The Company has also retained New York-based Rubenstein Public Relations for media relations services. Rubenstein will work with PhotoChannel's marketing team to increase visibility for the company as it continues its growth throughout the U.S. and Canada. Technology Highlights To remain the leader in online photo solutions for photofinishing retailers and wireless carriers, PhotoChannel has retained the services of one of the imaging industry's most seasoned and successful technology veterans. Aaron Rallo joined the PhotoChannel team in November after years of experience at Microsoft within the Windows Printing and Imaging team and at Fuji E-Systems (formerly AGT) as Vice President of Product Development where he was instrumental in developing Fuji USA's online photo service. During the course of the last few months the Company continued to expand its technical capacity to handle the increase in the number of orders and customers using its retailer sites. The Company's three year old partnership with TELUS Communications for data warehousing and Tier One data communications/Internet backbone peering is continuing to produce large advantages for PhotoChannel and its network customers. About PhotoChannel Founded in 1995, PhotoChannel has created and manages the open standard PhotoChannel Network environment. The PhotoChannel system is currently utilized by major photofinishing retailers and wireless carriers to provide their consumers with online image printing and picture messaging services. There are more than 8,000 retail locations worldwide accepting print orders from the PhotoChannel system. For more information on the Company visit www.photochannel.com. Certain statements in this announcement, including statements concerning our plans, intentions and expectations, contain "forward-looking statements" within the meaning of the Securities Act of 1933 as amended. Forward-looking statements are based on the opinions and estimates of management at the time the statements are made and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. These statements are not guaranties of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this announcement. Factors that could affect our actual results, include, among others, Photochannel's recent change in business focus, anticipated losses, unpredictability of future revenues, potential fluctuations in quarterly operating results, unproven business model, ability to make additional acquisitions, risks related to acquisitions, achieving adequate market share, brand awareness, competition, risks of maintaining and creating new business relationships, management of potential growth, risks of system interruption and risks of international operations. More information about factors that could potentially affect our actual results is included in Photochannel's filings with the Securities and Exchange Commission including the Form 20-F related to Photochannel. We undertake no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events. |
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