Shaw poised for boost from new iPhones

Apple Inc.’s new iPhone X, iPhone 8 and 8 Plus, announced Tuesday, are compatible with spectrum bands used by Shaw Communications Inc.’s Freedom Mobile, though not extending that capability to older models could dampen the positive effect on the company, according to analysts. Barclays Capital analyst Phillip Huang wrote in a research note Monday that if Apple were to launch “iPhones tomorrow (especially cheaper older models) that support band 66, we believe Shaw should be able to significantly grow its LTE iPhone BYOD subscriber base, even if it does not immediately begin selling iPhones.” Apple’s website Tuesday confirmed that the iPhone X and iPhone 8 do support band 66, though the older iPhone SE, iPhone 6s, and iPhone 7 do not. In a research note Wednesday, Canaccord Genuity analyst Aravinda Galappatthige said that not extending band 66 capability to the older models leads him to “wonder how material the impact of this would be for Freedom in the near term.” He noted that due to Shaw’s spectrum holdings, “device availability has been a major limiting factor with only a handful of devices being able to benefit from Freedom’s new LTE service.” Huang added that given Shaw is also expected to complete deployment of “almost all” of the 700 MHz and 2500 MHz spectrum it purchased from Quebecor Inc., “the pieces are quickly coming together for Shaw to turn more aggressive on wireless, perhaps in 2018.” Macquarie Research analyst Greg MacDonald wrote in a Monday note that Shaw and Quebecor are the Canadian carriers “best positioned to leverage their excess spectrum position to offer differentiated service as they further expand their LTE networks with the deployment of the 700MHz and in some cases 2,500MHz spectrum, and in Shaw’s case as more handsets (potentially the upcoming iPhones) are compatible with Band-66.” The phone was unveiled during Apple’s annual keynote Tuesday, which marked a decade since the release of the first iPhone. Macquarie’s Benjamin Schachter wrote in a separate note Monday that since the iPhone 6, “there has been relatively limited innovation and visible change” when it comes to iPhones. “We think that with expected innovations around , wireless charging, viewable screen size, OLED, and more, the next iPhone is clearly poised for its largest upgrade cycle yet,” Schacter said. Those expectations were correct, with Apple announcing Tuesday that the iPhone X does include an OLED display, wireless charging, and an increase in viewable screen size due to the elimination of the home button. It also uses facial recognition to allow the user to interact with the device — to unlock it, make purchases with Apple Pay, and animate emojis that reflect the facial expressions of users. Those innovations also come with a higher price tag, with the Canadian prices for the new phone starting at $1,319 for the 64GB version, up to $1,529 for the 256GB model. It will be available for pre-order Oct. 27, and available on Nov. 3. Galappatthige noted that the high prices could also limit the benefit for Shaw, given that “the lofty iPhone 8/X price points may be above Freedom’s current value conscious target market.” On Tuesday, Apple also announced that its Apple Watch will have cellular capability. Earlier versions of the wearable device paired with the iPhone for cellular functionality. In Canada, only BCE Inc. and Telus Corp. are listed as supporting the new watch, with Bell providing cellular service “in all Canadian provinces except Manitoba and Saskatchewan, and Telus service “coming later this year.” The watch will be available for orders Friday, with a general availability for most models coming on Sept. 22, the same as the new Apple TV device, which supports 4K content. Its Apple TV app, to be available a few days earlier, will offer live news and sports, including content from Rogers Communications Inc., Bell and CBC/Radio-Canada. “You’ll find your favourite sports from apps like NBA and Sportsnet, and late breaking news from apps like CBC News and Fibe TV, so it’s easier than ever to watch the live programming you love,” Apple’s website says. “You’ll find your iTunes purchases, your subscription services and a wide variety of free content on the Apple TV app. It even offers handpicked recommendations. Everything you want to watch is right here.” — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Charelle Evelyn at cevelyn@thewirereport.ca

Shaw poised for boost from new iPhones

News | September 12, 2017

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