Shaw 2011 Annual Report Download - page 10

Download and view the complete annual report

Please find page 10 of the 2011 Shaw annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 149

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149

Shaw Communications Inc.
MANAGEMENT’S DISCUSSION AND ANALYSIS
August 31, 2011
I. INTRODUCTION TO THE BUSINESS
A. Company overview – core business and strategies
Shaw Communications Inc. (“Shaw” or the “Company” or “Corporation”) is a diversified
Canadian communications and media company whose business is providing consumers with
broadband cable television, Internet, Home Phone, telecommunications services (through Shaw
Business), satellite direct-to-home services (through Shaw Direct) and engaging programming
content (through Shaw Media). Shaw Media operates the second largest conventional television
network in Canada, Global Television, and 18 specialty networks. It provides customers with
high-quality entertainment, information and communications services, utilizing a variety of
distribution technologies.
Shaw’s business is encapsulated within its vision statement: “We, the leading entertainment
and communications company, deliver exceptional customer experience through outstanding
people sharing Shaw values.”
Shaw’s strategy is to maximize shareholder value through the generation of free cash flow.1The
key elements of this strategy include: leveraging its network infrastructure and programming
assets to offer customers a wider variety of products and services; enhancing existing products
to provide greater value to customers; providing best-in-class 24/7/365 service; bundling
product offerings to provide value to both Shaw and the customer; and focusing on sound
capital management and operational efficiencies to maintain a competitive edge.
The strategy also includes promoting brand awareness, strengthening the Shaw name from
coast to coast. The Shaw brand is synonymous with diverse product offerings and exceptional
customer service.
During 2011 the Company operated three principal business segments: (1) Cable – comprised
of cable television, Internet, Digital Phone and Business Solutions operations; (2) Satellite
- comprised of direct-to-home (“DTH”) and Satellite Services; and (3) Media - comprised of
television broadcasting. As a percentage of Shaw’s consolidated revenues for the year ended
August 31, 2011, the Cable, Satellite and Media divisions represented approximately 64%,
17% and 19% of Shaw’s business, respectively. During 2011 Shaw’s businesses generated
consolidated revenues of $4.74 billion.
A fourth business segment, Wireless, was in the development/construction stage during 2010
and 2011. During 2008 the Company participated in the Canadian Advanced Wireless
Spectrum (“AWS”) auction and was successful in acquiring 20 megahertz of spectrum across
most of its cable footprint. In March 2010 the Company commenced activities on a traditional
wireless infrastructure build and late in 2011, after completing a strategic review of this
initiative, concluded that the economics as a new entrant would be extremely challenging, even
with the Company’s established base and considerable strengths and assets. Shaw decided to
not pursue a traditional wireless business and instead plans to focus on initiatives that align
with leveraging its Media and programming assets and strengthening its leadership position in
broadband and video.
The description of these operating business segments, including more specific details for the
last three fiscal years follows.
1See definitions under key performance drivers on page 20.
6