By CHRISTINE DOBBY
Saturday, January 6, 2018
When the Shaw and Rogers Canadian cable families expanded from television subscriptions into internet service in the early 2000s, then-CEOs Jim Shaw and Ted Rogers waged a friendly war over who could win the most new customers.
"Ted lost a bet so Jim sent him a whole case of baked beans," Jim's younger brother, Brad Shaw, the current Shaw Communications Inc.
CEO, recalled in a 2016 interview, laughing at the memory. "And when Ted won the next one, he sent a whole bunch of cows to Jim's house in Calgary. ... The next bet was for $1,000 and Ted won and so Jim sent him a wheelbarrow of pennies."
The antics were classic Jim Shaw, evidence of both his irreverent sense of humour and fierce competitive streak. Rogers Communications Inc. was an ally of sorts to Shaw - the two CEOs had recently hammered out an agreement to swap cable assets in each other's regions - but he still couldn't stand to fall behind.
Mr. Shaw died on Wednesday at the age of 60 after a brief illness, leaving friends and former adversaries alike to remember a man unlike any other telecom executive this country has seen.
He memorably wore motorcycle leathers to a cable convention and famously taunted the chairman of a powerful regulator, but over a dozen years as CEO, Mr. Shaw steadily built his family's cable company into a vertically integrated telecom and media empire.
James R. Shaw was born in Sarnia, Ont., on July 29, 1957, to Carol (née Bulman) and JR Shaw. The eldest of four children, he made a stab at a formal business education, but dropped out of the University of Calgary to work odd jobs around the farm outside of Edmonton where his family lived, including one scheme to start a Christmas-tree business. By 1982, his father convinced him to join the company, where he started at the bottom, digging cable ditches and later working as an installer, traipsing into customers' homes to connect their TV sets.
He eventually moved into management roles and was named vicepresident of operations in 1987. Two years later, he hired Peter Bissonnette, who would himself go on to be president of Shaw for more than a decade. By that time, Mr. Shaw already had big plans for the business.
During Mr. Bissonnette's first week on the job, the pair spent five days driving around Vancouver Island in the new recruit's blue Chevrolet Astro van, touring the company's cable systems and meeting key managers.
"When we sat at night having dinner, Jim set out the vision he had for the company," Mr. Bissonnette, who is still a board member, recalled in an interview this week. "He said, 'This is all about growth and acquisitions. We are not a seller. We are a buyer.' " JR Shaw had started the business in the 1960s when cable television was beginning to take off. He won his first broadcasting licence from the Canadian Radio-television and Telecommunications Commission (CRTC) for Edmonton in 1970. He spent decades convincing other small cable operators to sell to him, which mirrored what Ted Rogers, who started his own radio and cable business in Toronto in the 1960s, was doing.
By 1994, JR struck a deal with Mr. Rogers to divide up Maclean-Hunter's cable assets, beginning an informal agreement that would see the companies carve up English Canada to give Rogers control of the East while Shaw dominated in the West. The deal eventually led to that swap of cable assets, over which Jim Shaw presided in 2000, shortly after he became CEO in 1998.
As CEO of the company, by then headquartered in Calgary, Mr. Shaw doubled down on his father's expansionary bent. He continued to acquire independent cable systems and used aggressive tactics such as threatening to "overbuild" in an acquisition target's territory to convince less-willing operators to sell. He snapped up media assets as well, capping his tenure in the company's top job with a deal to buy CanWest's broadcasting assets for $2-billion in 2010.
Along the way he pushed Shaw in new directions, selling internet and launching home-telephone service - then a novelty for cable companies - and began to eat away at Vancouver-based rival Telus Corp.'s main business.
Shaw's market value grew dramatically over his years with the company, from $189-million in 1990 to $2.2-billion in 1998, when he became CEO, and $9.5-billion when he retired in 2010.
"JR built the foundation. Jim's legacy was the consolidation of the industry," Mr. Bissonnette said this week.
Telus CEO Darren Entwistle said of his old rival, "Jim was a terrific competitor throughout a sea change that transformed Canada's telecommunications and cable sectors."
Mr. Shaw also became known for scrapping with the CRTC, taking non-politically correct positions he said were all about consumer choice. He complained about being forced to carry channels that he said his subscribers didn't want - notably OUTtv, an LGBTQ station that Shaw frequently moved around the dial. He also griped about being forced to contribute to the Canadian Television Fund (a predecessor of the Canadian Media Fund), calling the homegrown content generator a waste of customer money. He pulled Shaw's payments to the fund at one point, prompting CRTC chairman Konrad von Finckenstein to call a public hearing. But when Mr. Shaw heard the chairman would not be at the hearing he said he would not attend, declaring he had no interest in negotiating with the regulator's "B-team."
"Everyone remembers Jim's interactions with Konrad," says Leonard Katz, a one-time executive at Rogers who later became a commissioner of the CRTC and was at a hearing when Mr. von Finckenstein fired back at Mr. Shaw for sending his own "B-team" in his stead. "He was a maverick, he wasn't happy with the status quo and always wanted to make changes."
Mr. Shaw could be hard to coach and was known to "just talk off the cuff" in CRTC hearings. "He'd have meetings with his lawyers and they'd tell him what to say and they'd write it down and he'd have this binder he'd walk in with," Mr. Katz says. "But he never bothered opening the binder or reading from a script or anything. He'd just say what he wanted to say and didn't care what people thought."
It wasn't an act, though, Mr. Bissonnette says. "He was prepared to bump heads with the CRTC to advocate for our customers. But that was a genuine passion he had. He thought things should be right by customers and his legacy will be in the customer service DNA of Shaw."
Mr. Shaw made life easier for the executives who worked for him by compensating them well. Very few ever left the company and when they did retire, Mr. Katz says, "They all walked out of there multimillionaires."
The Shaws are known to pay themselves well, too, even when they step away from the top jobs. After he retired, Jim Shaw began collecting a pension worth $5.9-million per year and under a 1997 agreement with JR Shaw - who remains executive chairman and still collects an annual salary of over $1-million - the company pays JR between 0.5 and 1 per cent of operating income before restructuring costs and amortization, which came in at $9.6-million last year.
Phil Lind, an executive and now a board member at Rogers, remembers Mr. Shaw as "very creative, hard-working and astonishingly good at pulling off the deals that he did." The hard-driving CEO admittedly played hard, too, and in 2008, he took some time off work for health problems related to bleeding ulcers. He did not go into detail on the affliction, but told The Globe and Mail during a 2009 interview that it led to "a regeneration of Jim," prompting him to lose weight and eat healthier.
"Basically, all the doctor said to me is, 'Jim, you can't keep going that way or you'll just fall over dead one day,' " Mr. Shaw said at the time. "I was getting pretty heavy, and then you don't eat right. There's all sorts of things, drinking too much - a whole bunch of everything."
By the time the CRTC approved the CanWest takeover in October, 2010, younger brother Brad Shaw was tapped to take over as CEO the following year. And Jim Shaw's departure was accelerated following what became an infamous lunch CIBC hosted in Vancouver during which he reportedly appeared drunk and belittled investors.
Mr. Shaw maintained a low public profile after that, though he remained vice-chairman of the company's board of directors. He married his third wife, Kathryn O'Neill, on Feb. 24, 2012, and the two exchanged whimsical vows about their love inspired by the style of Dr. Seuss's Green Eggs and Ham. In 2014, the pair donated $19-million to Shawnigan Lake School, the B.C. boarding school Mr. Shaw graduated from in 1977.
He maintained a large circle of friends from his decades in business and enjoyed taking in football games, hosting large dinners in Las Vegas and sailing. In 2012, when his old friend Phil Lind was inducted into the U.S.-based Cable Centre's Cable Hall of Fame, Mr. Shaw brought his luxury yacht to Boston for the ceremony and hosted an on-board reception.
Last summer, loved ones from around the country gathered for Mr. Shaw's 60th birthday party at his lakeside home in Kelowna, B.C. It was a chance, Mr. Bissonnette says, for people to come together "united in our love for Jim." The setting was fitting too, he says, for Mr. Shaw, the former workaholic CEO, was finally living a more balanced life there.
Mr. Shaw leaves his wife, three children and three stepchildren, as well as his sisters, Heather and Julie, brother and parents.
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Jim Shaw steered Shaw Cable through a period of aggressive expansion and consolidation in the telecom sector.
THOMAS FRICKE/THE GLOBE AND MAIL