Home » Canada »Competition »Public Policy & Gov't »Shaw » Currently Reading:

Shaw Invades Ontario With Approval of Mountain Cablevision Acquisition, Becomes Canada’s Largest Cable Operator

Phillip Dampier October 29, 2009 Canada, Competition, Public Policy & Gov't, Shaw No Comments
Mountain Cablevision becomes part of the Shaw Cable family with the approval of the CRTC

Mountain Cablevision becomes part of the Shaw Cable family with the approval of the CRTC

The Canadian Radio-television and Telecommunications Commission has given approval to Shaw Communications for its acquisition of Hamilton-based Mountain Cablevision, Ltd., a small independent cable operator in southern Ontario.  The $300 million dollar transaction brings 41,000 cable customers, 29,000 Internet subscribers, 30,000 digital phone lines, and 135 Mountain Cablevision employees into the Shaw family, making the Calgary-based cable company Canada’s largest.

“This is a great move for us to come in there and be able to start being around that market. We always said that […] we want to be in Alberta, British Columbia, and Ontario,” Shaw chief executive Jim Shaw said Friday.

“Rogers had passed on the acquisition so we decided to go in there,” Shaw told analysts. “This is a great move for us, being around that market.”

Mountain Cablevision serves a small part of Hamilton and surrounding communities in southern Ontario

Mountain Cablevision serves a small part of Hamilton and surrounding communities in southern Ontario

Shaw’s entry into Ontario upset Rogers Communications, eastern Canada’s dominant cable provider.  Rogers sued Shaw in an Ontario court, claiming the purchase violated a near-decade long agreement made personally between Ted Rogers and Jim Shaw to stay out of each other’s territories — Shaw stays out of eastern Canada if Rogers moves no further west than Ontario.

Canadian courts aren’t compelled to recognize handshake deals made over dinner, and the court ruled against Rogers.

With the agreement swept away, some analysts predict Rogers will investigate acquisition opportunities in western Canada, probably in the more populated regions.

Shaw claims it will upgrade Mountain Cablevision’s small cable footprint, which serves only a portion of greater Hamilton – Hamilton Mountain and East Hamilton, as well as the communities of Mount Hope, Caledonia, Hagersville, Jarvis, Dunnville/Byng, Cayuga and Binbrook, all in Ontario.  The company promises better broadband, cable, and telephone service after the upgrades are complete.  Shaw also says it will expand the Mountain Cablevision system into several unserved neighborhoods and townships.  That’s an important distinction, because it indicates Shaw has no intention of competing head to head with Rogers or Ontario’s other dominant cable company Cogeco.

The deal comes during challenging times for Shaw, who announced a 6% decline in profits in the fourth quarter, with gains only from new digital cable additions.  More than 110,000 Shaw customers signed up for digital cable in the third quarter, up from 23,000 in the third quarter a year ago.

In other areas, Shaw lost customers — 5,000 canceling broadband, 4,500 dropping Shaw’s direct to home satellite service, and nearly 9,000 disconnecting their Shaw digital phone line.

Shaw’s next product introduction will likely be its new cell phone service.  The company spent $190 million dollars last year acquiring 18 airwave licenses in northern Ontario, Manitoba, Saskatchewan, Alberta, and British Columbia.

Mountain Cablevision's concentrated service area in the city of Hamilton

Mountain Cablevision's concentrated service area in the city of Hamilton (click to enlarge)

But Shaw is taking a “very cautious approach” to wireless mobile services, according to the company.  It has refused to set a timetable when service would begin.  Shaw faces a growing number of wireless competitors introducing service in Canada late this year and into early 2010.  DAVE Wireless, Wind Mobile, and Public Mobile are all poised to launch in major Canadian cities, expecting to put competitive pressure on pricing and bring about lower priced, more generous service plans.

Shaw claims it’s not concerned, telling The Financial Post, “If they’re in there, we don’t really care. We already have a relationship with customers and they have zero,” Shaw said. “We have 3.4 million customers we have a relationship every month with.”

Telecommunications companies are increasingly concerned with offering customers “bundles” of telecommunications services from video, broadband, wired phone lines, and now increasingly wireless data and mobile phone services.  Customers purchasing bundles tend to remain loyal to the companies offering them.

Search This Site:

Contributions:

Recent Comments:

  • chickenpatti13: I'm not going to be upset over loosing favorite channels.Once upon a time,there was no TV.I'll use all that free time to expand my farm.You can't wear...
  • DCUNY: 113/12 now in area of Hilton, NY. Was 70/6 last year or so....
  • Daniel Haro: no WORRIES FOR US IN San Antonio TX. Google FIBER HAS LAUNCH SHOULD BE AVAILABLE TO MOST OF San Antonio IN THE COMING MONTHS. WeCAN FINAL DITCH THIS P...
  • bc: woke up to 130/15 speeds this morning batavia ny 14020...
  • Racerbob: Confirmed upgrade here in West Webster. 60/5 is now 100/10 for me. http://beta.speedtest.net/result/6880083440.png...
  • Fred Pilot: Interesting that "the Internet" is still discussed as if it's something new circa early 1990s when in fact it's been widely available for some number ...
  • Don: I just got off the phone with Spectrum and I asked about the small speed increase. He said that I am part of the new lift area. He said that in my are...
  • Racerbob: A friend here in Webster started seeing 150 Mbps download speed yesterday. A chat with Spectrum today told him that more speed would be seen next week...
  • Don: I'm in Gates, New York and I'm on the ultra plan and my speeds were around 117/11.5 but now are showing around 141/11.5 but not sure why. The speed re...
  • Reuben Mahar: New Speeds are online in Waldoboro Maine. 04572. Testing at 112 x 11. I wonder if this has anything to do with LCI offering fiber in my area,,,,, ...
  • Peggy: Sorry to tell you but they set up the account based on your address, not your name. And the other thing is, it does depend not only on your address bu...
  • EJ: I am curious to see the specifics of this "DEAL". How bulletproof does this need to be, how much redundancy does there need to be, who decides what an...

Your Account:

%d bloggers like this: