Shaw 2012 Annual Report Download - page 12

Shaw Communications Inc.
MANAGEMENT’S DISCUSSION AND ANALYSIS
August 31, 2012
August 31, 2012, Shaw served approximately 2.2 million cable television customers in five
provinces (British Columbia, Alberta, Saskatchewan, Manitoba and certain portions of Ontario),
representing approximately 31% of the Canadian cable television market.
The Company’s cable television business is operated through its extensive fibre optic and
co-axial cable distribution network. Shaw’s fibre backbone and interconnect network link its
cable systems and subscribers together. Shaw receives originating television signals at its
head-end sites and re-transmits these signals via its network to customers’ homes in its cable
serving areas. Digital cable customers receive additional services via digital cable terminals
(“DCTs”) which translate encrypted signals delivered to customers’ homes over Shaw’s network.
Digital cable significantly expands the range of services that may be offered to a subscriber and
extends programming capacity. Digital cable, which is delivered by the Company’s network to
DCTs deployed in subscribers’ premises, also enhances picture and sound quality and provides
the platform from which Shaw has launched, and expects to continue to be able to launch, new
revenue-generating video and interactive services. Shaw offers customers a variety of DCTs for
purchase or rent.
To its Digital subscribers, Shaw also offers On Demand viewing options, including Pay-Per-View
(“PPV”) and Video-on-Demand (“VOD”) services. The PPV service allows customers to select
and pay for specific programs which are available on various channels with different start times.
The VOD service enables customers to select programming from a library of titles through an
on-line ordering system or directly through the set-top interactive program guide, and to view
the programming on their television at a time of their choosing, with pause, skip backward and
skip forward functionality. On Demand programming includes movies, sports, concerts and
other special events, with prices dependent on the nature of the programming. Shaw also offers
a wide variety of free On Demand programming including hit TV series, movies, events, music
videos and more. Shaw offers On Demand programming to over 97% of its customers.
As at August 31, 2012, the Company had approximately 1.9 million Digital subscribers,
representing a penetration rate of over 86% of Basic cable subscribers. Of the Digital
customers, over 1.0 million have HD capabilities. Shaw continues to launch HD channels which
offer superior picture detail and sound quality in a format that fully utilizes the capabilities of
wide screen, HD ready televisions. In support of HD, Shaw offers for purchase or rent DCTs
which support the decoding and processing of HD content, as well as DCTs which incorporate
HD and Personal Video Recorder (“PVR”) features.
Shaw recently launched the first phase of its TV Everywhere service, Shaw Go, which allows
customers streaming access to TV shows, sporting events and movies on popular mobile
devices. The first phase of the service includes the Shaw Go Movie Central and Shaw Go NFL
Sunday Ticket apps.
Internet
Leveraging its cable television infrastructure, Shaw provides high-speed Internet access services
to residential and business subscribers in almost all of its operating areas. The Company
currently offers a wide variety of residential Internet service levels to match the speed, usage
and budget requirements of its subscribers. Similar to its residential Internet service, Shaw also
offers a variety of Internet services for small and medium business customers. As at August 31,
2012, there were over 1.9 million subscribers (connected and scheduled installations) to
Shaw’s Internet access services.
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