Shaw president: Arrival of iphone has changed business model

The arrival of Apple’s iphone has tripled the number of Shaw Communications Inc.’s subscribers and has completely transformed the way the company is competing against Canada’s three big national wireless carriers, the company’s president said Thursday.

The Calgary-based cable, internet and satellite company is a relatively new player in Canada’s hotly contested wireless market but Shaw president Jay Mehr told analysts he thinks Shaw’s Freedom Mobile is ready to take on the Big Three.

“It does feel like a new business, starting in December,” Mehr said on a conference call to discuss Shaw’s results for its fiscal 2018 first quarter, ended Nov. 30 — just prior to the addition of Apple’s products to its lineup for the first time.

Among other things, Shaw added 34,000 wireless subscribers during the months of September, October and November, bringing its total number of wireless customers to 1.18 million.

That was up from 9,500 net additions in the comparable months of 2016, which was a low point for Shaw since it become Canada’s fourth- largest wireless carrier with the purchase of Wind Mobile in a deal closed on March 1, 2016. Mehr said that Shaw’s wireless business — now named Freedom — has changed fundamentally with the arrival of Apple at the beginning of this year’s fiscal second quarter.

“It has changed all aspects of our wireless business,” Mehr said.

Until reaching its first commercial deal with Apple, Freedom sold few phones and focused almost entirely on customers who used their own devices (BYOD) and generated about $37 per month in average revenue.

With the arrival of the iphone, which can only work on the portions of Freedom’s network that has been upgraded to fourth- generation standards, Shaw is aiming to push Freedom’s average revenue per user above $50 per month.

“In Q2, we haven’t put any energy into BYOD ... It’s hard to say two things at once and we’ve been saying iphone as loudly as anyone will listen,” Mehr said.

Among those listening were Shaw’s biggest competitors, who ramped up their pricing promotions in December and wooed away many of Freedom’s established customers.