CALGARY – Facing serious competitive attacks on the TV front as well as rapidly developing global wireless technologies, Shaw Communications said today it is putting the brakes on its wireless network build.
"The competitive environment has moderated revenue growth this year in our core business and presented an increased level of risk to our forecast,” said company CEO Brad Shaw in the company’s press release announcing its quarterly financial results on Wednesday morning.
"With the rapid development of wireless technology, including long-term evolution ("LTE") options, and the dynamics within the wireless industry evolving at a swift pace, we are currently evaluating technology and strategic alternatives with respect to our wireless initiatives. We plan to slow our wireless build activities as we carefully consider all options in advance of the launch of a wireless service.”
Later in the day, during Shaw’s conference call with the Street, when one analyst asked whether the company might go as far as “mothballing” the portions of the wireless net it has built so far, senior vice-president of planning Michael D’Avella said: “That’s certainly a possibility… “The evolution of LTE is happening a lot faster than anyone anticipated… The prudent call is to step back, watch LTE evolve.”
Shaw executives made it clear they are not walking away from the spectrum or from wireless in general, but that with the world very rapidly going to LTE technology, despite how new HSPA still is, it could no longer justify “being the sixth HSPA player,” CEO Shaw said.
Executives were further asked if the company would consider wholesale agreements with other existing carriers as an interim measure to be able to provide wireless to Shaw customers. “We’re open,” is all CEO Shaw would say.
The company also wouldn’t commit to being a player in the 700 MHz auction coming in 2012. “We’re going to wait and see what the auction framework looks like before we make that call,” added D’Avella.
During the call, Shaw executives also confirmed what was an open secret – that the new gateway box it will begin deploying in May to combat the various telco TV Microsoft Mediaroom powered services – is the Arris Moxi device.
– Greg O’Brien
