Shaw job cuts match erosion of cable base, U of C expert says

Gregory Taylor, the author of Shut Off: The Canadian Digital Television Transition, says he foresaw Shaw's shift from cable to wireless.

The head of Canadian Spectrum Policy Research at the University of Calgary spoke Wednesday on the Calgary Eyeopenerabout the telecommunications giant offering buyouts to 6,500 employees.

The Calgary-based companysaid this week it expects to shed at least 650 positions across the country.

Q: Were you surprised by Tuesday's announcement?

A:I expected there might be some sort of moves, because we've seen this over the past couple of years with Shaw. This is not coming out of nowhere.

They're making a big change in the corporate strategy at Shaw and I think the main thing is to look at their move into wireless. Shaw is a company built on the cable industry, and the cable industry even though it's still extremely strong is in decline. And nobody sees that decline ending anytime soon.

We're seeing Shaw really make a shift from their traditional area of cableinto the really very capital intensive new area of the wireless sector withFreedom Mobile, which they launched last year [after purchasing and rebranding Wind Mobile].

Q: Fair enough. Does wireless have to equal jobless?

A: They're trying to do as much online throughappsandthroughautomated service online instead of speaking to someone individually. We'll have to see if that works, becausesometimes people find that quite frustrating. They want to speak to an actual human being. But for now, their focus for where their investment is going right now is less on the personnel required for the workforceand [more focused on] building the network they're going to require to compete with Telus and Bell.

Q: The big three telecoms in Canada are Bell, Rogers and Telus. Where does Shaw fit into that group?

A:As far as ingratiating themselves, they've been a pain for the other three in that sense, they've really announced their presence. We saw that over the Christmas break, when we suddenly had all of the big three in unison offering these really good deals [on data plans]. And that was kind of a trial balloon. We saw lineups in shopping malls around the country of people trying to get this deal.

But you're right in saying the Big Three are a pretty cozy little group. You're not going toget a lot of differencesin pricing of the Big Three.If you take a look across the country, [the province]where you really see differencesin your mobile priceis where there's a fourth player in Saskatchewan for example, where there's SaskTel.

Q. Who pays in the end, in terms of reduced service?

A:The cable services have been pretty consistent. Now when I say consistent, it depends on your age group. People basically over 40 are carrying the cable industry right now but the cable industry has not seen the big plunge that some people had foreseen. There's been a slow decline in cable. It's dropped about 4 per cent. And if you take a look at these cutsthey're offering in their workforce, it works out to about 4 per cent of their workforce.

I don't think cable is going to suffer. I don't think the prices for cable can go up very much more. They're already getting people really on the verge of cutting their cable and they can't afford to lose many more.

But the one thing you never see in the cable industry is a drop in prices. That doesn't seem to cross their minds.

And they will nickle and dime it up in the coming years.

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With files from the Calgary Eyeopener