Shaw scraps plan to build wireless network, opts for Wi-Fi network

It’s been a long time in the making but Calgary-based Shaw has finally announced what they are doing about their wireless plans, or now lack of. Shaw won 18 licenses in Western Canada and Norther Ontario and has been sitting on their $189 million investment since the 2008 wireless spectrum auction.

Today Shaw stated in a press release that they have “completed a thorough strategic review of the wireless business opportunity” and “we could not justify a wireless network build at this time”. The reasons are the high upfront cost for a new entrant to build out a wireless network, coupled with the incumbents coverage and their “extensive device ecosystems, deep spectrum positions and large retail networks” it would basically not pay off for their shareholders.

So what are they doing? Shaw has decided that “a more prudent approach” is to deploy a Wi-Fi network. Shaw stated the rationale for this move is that it’ll save “well over $1 billion in capital expenditures on a traditional wireless network build… given that Wi-Fi spectrum is free and there are no device subsidies, we can build extensive Wi-Fi coverage at a substantially lower cost relative to a traditional wireless network”. So you can expect tablets and other Wi-Fi only devices.

CEO Brad Shaw said that “We have decided to focus on strengthening our core business and leveraging our media and programming assets to support our leadership position in broadband and video. Our decision not to pursue a conventional wireless business is consistent with this strategic approach and our focus on shareholder value.”

TELUS, Rogers, Bell and the other new entrants must LOVE this news. No word on what they have planned for their spectrum licenses.

Source: MarketWire