What Happened to Shaw’s Wireless Plans? Is a New Partnership in the Works?

by Jordan Richardson on July 25, 2011

Shaw Communications is, according to many telecommunications analysts, pulling out of a “prolonged slide.” The company has brought about faster Internet speeds and better retail packages, including unlimited Internet, in order to take on their chief rival Telus Corp. The Calgary telecom corporation, fresh from the time and money drain of purchasing Canwest Global Communications, appears to be getting its feet back under it.

There are a few foreseeable difficulties for Shaw, though.

Once upon a time, Shaw boasted of bringing about a wireless network and entering the game current dominated by the big providers. Along the way, new carriers have thickened the stew to the point that Shaw is going to have to produce something truly remarkable to make the splash they’re banking on.

Of course, there’s the consideration that Shaw isn’t even working in a wireless direction any more. Back in January, Shaw apparently stopped building the network in Vancouver and Edmonton. In April, they stopped working on it in Calgary. After purchasing $189 million worth of spectrum in Western Canada and Northern Ontario, it was a strange to see. Shaw executives claimed to want to focus on the “core business” instead, but an internal memo circulating through the company said that the Calgary wireless build-out was completely halted.

On an earnings call that took place at the end of June, Brad Shaw said that the management and the board was going to “evaluate technology” required to launch wireless. The company has put a hold on wireless capital spending, so some unsurprisingly interpreted Shaw’s comments as a dismissal of the wireless direction entirely.

So what happens next?

Some are suggesting that Shaw is prepping to jump into bed with Rogers Communications. With precious little spectrum to go around in the upcoming federal auction, this makes sense from a strategic standpoint. Out West, Rogers is relying on microwave systems that will probably run out of steam as data usage increases. Forming some manner of strategic partnership with Shaw would let them hop aboard existing networks and eliminate any stress on the microwave front.

It could be, then, that Shaw hasn’t ditched the wireless plans entirely but instead has ditched the notion of going it alone. In dropping capital expenditures, perhaps temporarily, it could be that Shaw is putting more time in to ironing out boardroom deals than it is actually building new networks.

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Written by: Jordan Richardson. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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