Microsoft Invests $400m in Rogers Communications for High-Speed Internet Access

Strategic Insights -

Microsoft has made a significant investment in Rogers Communications, the largest Canadian cable television services company, with the aim of boosting high-speed internet access and interactive television services. This investment is part of Microsoft's strategy to take minority stakes in communications companies and provide access to its software and internet services. The partnership will enable Rogers to accelerate its efforts to provide advanced internet and interactive television services via its broadband network, serving 2.2 million homes in Toronto and Vancouver.

Key Takeaways:

  • Microsoft invested $400m in Rogers Communications, the largest Canadian cable television services company.
  • The investment aims to boost high-speed internet access and interactive television services.
  • Rogers will use Microsoft software in at least 1 million new digital set-top boxes to provide internet access.
  • Microsoft will develop branded e-mail and Canadian content services for Rogers.
  • The agreement will help Rogers accelerate its efforts to provide advanced internet and interactive television services via its broadband network.
  • Rogers' cables serve 2.2 million homes, mainly in Toronto and Vancouver, with two-way capability installed on 89% of its network.
  • Rogers had $2.8 billion (C$5.3 billion) in revenues last year, with 36% coming from its cable operations.
  • Microsoft has also invested in several other communications companies, including Comcast, TCI, AT&T, and United Pan-European Communications.
  • Microsoft's vice-president, Thomas Koll, stated that the goal of the partnership is to accelerate the widespread adoption of broadband content and services in Canada.

Statistics:

  • 1 million: The number of new digital set-top boxes that Rogers will use Microsoft software in.
  • 2.2 million: The number of homes served by Rogers' cables, mainly in Toronto and Vancouver.
  • 89%: The percentage of Rogers' network with two-way capability installed.
  • $500 million (C$900 million): The combined annual revenue of Rogers (C$2.8 billion) and Microsoft's (estimated).
  • $1.9 billion: The US dollar equivalent of Rogers' annual revenue.
  • 15%: The increase in Rogers' share value over the final two trading days last week.
  • 36%: The percentage of Rogers' revenues derived from its cable operations in 1998.
  • 1998: The year Rogers reported debt of $5.3 billion in its annual report.

Sources:

  • "Microsoft invests $400m in Rogers Communications" - The Financial Times, 1999.
  • Rogers Communications, 1998 Annual Report.