Expanding small cableco in B.C. says it’s unaffected by DTH competition, piracy

Asmall cable operator based in Salmon Arm BC is going against the grain and expanding in the face of continued pressure from direct-to-home (DTH) satellite TV competitors. While many other small cablecos are lobbying for increased regulatory help as they face expensive plant upgrades and the challenge of bringing new options such as video-on-demand (VOD) to a small customer base, Mascon Communications Corp. says it is feeling few competitive effects from either Star Choice Communications Inc. or Bell ExpressVu LP. "We haven’t lost that many customers to DTH, and we have a great buyback program that we’ve introduced. I mean DTH costs are rising every month from what we see, and the costs for our packages are very competitive," says Mascon technical manager Craig Mackay. And while many distributors whine that satellite TV piracy is cutting into their business, Mackay notes that Mascon has not really been affected by it. Established in 1983, the cableco provides cable TV and high-speed Internet services in a dozen communities, with its basic cable subscriber base currently at about 6,500. It owns Lumby Cable Ltd., Sicamous Cable Ltd., Pender Island Cable TV Ltd., Chase Cable Ltd., Sun Peaks Cable TV & Internet Inc., as well as 50% of Wood Lake Cable Ltd. The company’s expansion has resulted through the acquisition of existing systems, as well as the establishment of a new one, and the addition of new services such as digital cable and more importantly the continued rollout of high-speed Internet access. Earlier this year Mascon formed Cayoosh Communications Inc. to construct a new cable system in Lillooett BC. It also acquired the cable assets of Sun Peaks Cable, and bought cable systems in Mayne and Galiano islands from Gulf Islands Cable as an extension of its Pender Island cable system within the last year. In May, it announced that it was beginning an extensive rebuild at Mayne and Galiano to make way for its digital cable offering and high-speed Internet access. Its recent acquisition trend is in contrast to the years 2000 and 2001, when the company sold some of its cable assets at the top of the market. It sold Peachland Cable to Shaw Communications Inc. in October 2001, and transferred ownership of its wholly owned subsidiary Barriere Cable Ltd. in September 2000 to Paul and Karen Caissie of KC Holdings Ltd., the owners of Raftview Communications Ltd. that operates Clearwater Cable TV. About three months ago, Mascon took the unusual step of building a cable system from the ground up in Lillooett. "We saw an opportunity and went in and built the system," Mackay says. "There are fewer and fewer rural communities that have no services and I think that was one of the last ones (left) in B.C. And it had good demographics." Cayoosh Communications has been operational in Lillooett for only about two months, but Mackay says the cableco has already reached the company’s six-month customer target. He would not provide concrete figures for the company’s subscriber goals. In March of this year, Mascon announced that it was purchasing all the cable assets of Sun Peaks Cable and subsequently rebuilt the plant, launched high-speed Internet there three weeks ago, added 15 more analog channels, and is looking at bringing the community digital TV. Mackay says the resort area, dubbed by some as the next Whistler, is rapidly growing and that business plans are more than on track. Mascon offers its services, including wireless Internet connections to hotel restaurants and lounges, and other businesses in Lillooett. "It’s really growing up there. They expect to have 10,000 people living there within five years," Mackay notes. He sees a lot of growth in the Internet area, and says Mascon will continue to pursue further acquisitions. "Within the next year, the Internet will be the next push and cable will be something that you get on top of Internet. We’re probably at 60% penetration of our cable subscriber base with the Internet," he says. "Anywhere that makes sense to us, we’ll go there. At this time, we don’t see anything (that would fit), but everything changes day-to-day in this business."

Expanding small cableco in B.C. says it’s unaffected by DTH competition, piracy

Broadcast | August 22, 2003

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