SOURCE: Cardinal Communications, Inc.

January 30, 2007 12:49 ET

Cardinal Communications Completes Foreclosure and Integration of Video-on-Demand Assets and Technology

BROOMFIELD, CO -- (MARKET WIRE) -- January 30, 2007 -- Cardinal Communications, Inc. (OTCBB: CDCI), a provider of voice, video and high-speed broadband communications services, and a specialized developer of residential real estate (the "Company"), today announces that it has completed its acquisition of the video-on-demand assets and technology of GalaVu Entertainment Networks, Inc., via foreclosure under the laws of Canada.

The company now offers a full suite of video-on-demand services and technology in the United States, through the company's majority owned subsidiary, Cardinal Connect, LLC, and throughout Canada and internationally, through Cardinal Connect's subsidiary, Cardinal Hospitality Ltd. Cardinal Hospitality currently has contracts to provide content, service, and in certain cases, to install new systems in 180 hotels with approximately 22,000 rooms throughout Canada. The company also serves five hotels in Aruba and four in the United States, as well as offering service support to hotels in to Scotland, South Africa, and Australia.

President of Cardinal Connect, Steve Basmajian, stated, "We are pleased to have completed this process and we are proud to be offering top-tier service and technology to the hospitality industry. However, we intend to not only focus on expanding our footprint in the hospitality sector, we also intend to deploy our video-on-demand technology in the residential sector soon."

Mr. Basmajian also announced that, as a component of the transfer of assets and technology, Cardinal Connect has transitioned to a new and improved accounting system, and created a new sophisticated call center based in Halifax, Canada which is operated under the leadership of two of the original developers of the system, Will Kay and Brian Nichols.

Led by experienced video-on-demand management, Cardinal Hospitality's first operating month -- October of 2006 -- showed promise, with a profitable month right out of the gate. Mr. Basmajian added, "We expect to see an increase in profitability this year due to at least three elements of our business plan: an increase in the number of installations of new in-room systems, upgrades from our current tape-based systems to our new digital video-on-demand system, and our internal restructuring, which has controlled costs and grown our bottom line. We are all excited to be a part of this new Cardinal initiative. Over the next several weeks, we plan to provide additional updates and reports regarding our business results and operations."

About Cardinal Communications, Inc.

Cardinal Communications operates a suite of vertically integrated businesses that provide both bundled digital communications services (voice, video and high-speed Internet) and high-quality real estate to the residential marketplace. The Company's expertise in communication infrastructure and turnkey residential development allows Cardinal to capitalize on growing demand among homebuyers for modern residences that are pre-equipped with a range of digital communications options. The Company is also partnering with other developers that seek Cardinal's expertise in designing, building and operating residential communication networks that will deliver long-term revenue opportunities. Based in Broomfield, Colo., publicly traded Cardinal trades on the Bulletin Board under the symbol "CDCI." For more information, visit the Company's website at

SAFE HARBOR STATEMENT: Some information in this release is forward looking. These forward-looking statements may be affected by the risks and uncertainties in Cardinal Communications and its subsidiaries and divisions. This information is qualified in its entirety by cautionary statements and risk factors disclosure contained in certain of Cardinal Communications' Securities and Exchange Commission filings. Cardinal Communications wishes to caution readers that certain important factors may have affected and could in the future affect its actual results and could cause actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of Cardinal Communications. There are many factors that will determine whether Cardinal Communications will be successful in its endeavors, including, without limitation, access to adequate capital and consumer acceptance of its telecommunications service offerings. Cardinal Communications undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date hereof.

Contact Information

  • Contact:
    Ron Bass
    Principal Accounting Officer
    Cardinal Communications, Inc.