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A well-rounded and well-healed communications juggernaut

Fri, 11/30/2001 - 7:00pm
James Careless

Google Factor: 4,370

Thirty years ago, Shaw Communications was just a small cable TV system in Edmonton, Canada. Today, Shaw has 2.8 million subscribers through the company's Star Choice DTH and Shaw Cable TV, making it Canada's largest provider of relayed TV signals. Shaw has 356,000 digital cable subscribers in Canada, making it the largest provider of digital cable signals north of the border. In comparison, Rogers has 247,000 digital subs, even though Rogers has 2.3 million cable TV subscribers compared to Shaw's 2.1 million.

Shaw also has more than 600,000 subscribers to its high-speed data service, which is why Shaw is the largest member of the @Home consortium in all of North America. Yup, Shaw has more high-speed subs than other Excite@Home members, including AT&T, Cox, Charter and Adelphia.

Additionally, Shaw had the foresight to build its own Internet backbone, which it lovingly calls "Big Pipe." That backbone helped Shaw reduce its exposure to @Home's technical and financial problems. The result: when @Home recently filed for bankruptcy and temporarily ceased provisioning new subscribers, Shaw was unaffected.

Big Pipe also provides a high-speed route for 41 business clients. Moreover, Big Pipe stretches across the U.S. as well, with points of presence in Seattle, Sacramento, Detroit, Washington, New York, and Washington, among others.

Meanwhile, Shaw's decision to buy Canadian Satellite Communications –Cancom–allows it to share Cancom's resources with its Star Choice DTH service. Better yet, Shaw makes money by supplying distant signals not just to DTH subscribers, but to other cable TV MSOs across Canada–even though Star Choice is competing in their territories for subscribers!

Then there's Corus Entertainment. Also controlled by the Shaw family, Corus owns and operates 52 radio stations in Canada's top markets, plus all or part of TV channels such as YTV, Country Music Canada, and The Comedy Network.

Like everyone else, Shaw's been hurt by the recession. In fact, Shaw lost $189 million in 4Q2001, compared to $7.9 million net income in 4Q2000. Much of this loss came from write downs in tech stocks, including $94.8 million lost on 360networks, and $89.6 million on Liberty Digital. Still, Shaw can lean on its solid portfolio of businesses, and investors like Bill Gates and Warren Buffet.

In fact, "entering the States may be our next move," says Jim Shaw. Given this family firm's track record to date, such a move seems more than likely.

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