Crown Media (NASDAQ:CRWN), operator of cable nets Hallmark Channel and Hallmark Movie Channel, released fourth-quarter earnings last week. How were they? Not so good, but there were some improvements. Let's have a look.

This Fool by Numbers will give you a nice rundown of all the pertinent data. The first thing that strikes you is the weak top-line performance -- net sales dropped 3.5%. This was driven by the sale of the company's film library and a lesser amount of advertising spoils from Hallmark cards. Net loss on both a dollar and per-share basis did improve, though -- these figures were cut roughly in half.

There were some positive aspects to the quarter. Revenue related to subscriber fees increased 16%. Advertising revenue jumped 28%, helped along by higher viewing levels. In addition, margins increased across the board. Marketing costs did increase, but that might be forgivable, since the company is investing in its brand and viewership is up.

However, there are a lot of negatives to this situation. Take cash flow, for instance. The company used cash from operations instead of generating it over the past quarter. What about the last few years? Same thing, according to the recently filed 10-K -- no operational cash flow whatsoever. Know what that means? No free cash flow. That's a bad thing, Fools.

Crown Media just doesn't have a good asset base -- its story basically boils down to the two aforementioned cable channels. In addition, the company saw a need to sell off its movie library -- why would I want to invest in a media concern that cannot leverage a content collection to good advantage? Companies like Time Warner (NYSE:TWX), Lions Gate Entertainment (NYSE:LGF), Disney (NYSE:DIS), and News Corp. (NYSE:NWS) know how to monetize their vast entertainment portfolios, but Crown Media simply doesn't. Perhaps that's why Time Warner and Disney have both made it into the market-crushing Stock Advisor portfolio (and Crown Media hasn't).

Even with the backing of some high-profile names -- including Liberty Media and DirecTV (NYSE:DTV) -- Crown Media just doesn't cut it as an investment idea. I'd urge Fools who are looking for exposure to the media industry to consider names with better earnings quality attached to them. Content is king, as they say, but Crown Media is not in the least royal.

Further Foolish perspective on Crown Media:

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Fool contributor Steven Mallas owns shares of Disney. As of this writing, he was ranked 14,273 out of 24,208 investors in the CAPS system. Don't know what CAPS is? Check it out. The Fool has a disclosure policy.