For Darren Entwistle, Telus Corp.'s plan to spend $1-billion in fibre-optic expansion in Vancouver is more than just a prudent investment, it is yet another example of taking a risk he is convinced will pay off over time.
During an interview on Friday, Mr. Entwistle, now back on the job as chief executive officer, recalled decisions over his long tenure at the Vancouver-based telecommunications firm that were met with skepticism but later recognized as cunning strategic moves.
"Something I look back on with some semblance of curiosity is all the great investments that have paid off for Telus didn't start out as popular ideas. Quite the antithesis of that and maybe there's significant tuition value to be garnered from it," he said.
Having a board that was willing to look past the quarterly pressures and focus on the long game helped, he said, pointing to Telus's national wireless expansion through the purchase of Clearnet Communications Inc. shortly after he joined the company in 2000, as well as later initiatives to focus on customer service and get into the health-care industry.
Mr. Entwistle moved from executive chairman of the board back to CEO when the company announced Joe Natale's departure from that role in early August. He said on Friday he was "thrilled to be back, thrilled to be alongside my Telus team members," and excited to announce the five-year plan to upgrade the company's existing copper-based infrastructure in Vancouver.
"I think this is another example of how Darren has always led us to make long-term bets that are right for our shareholders, right for our customers," said Josh Blair, executive vice-president of Telus Health and one of Mr. Entwistle's most trusted associates.
Yet, the Vancouver announcement is also part of a larger capital spending push by Telus and other telephone companies such as BCE Inc. to upgrade their networks to fibre, which transmits data over ultra-thin strands of glass using pulses of light. Fibre is fast and has much greater bandwidth capacity than the copper wires traditionally used for the "last mile" in telephone networks.
Telcos need to upgrade so they can keep up with speed and capacity demands as both residential and business customers use more and more Internet data. They also need the upgraded infrastructure to support their wireless services, which rely on the wires in the ground to provide a connection to the Internet.
Their cable company competitors have a head start because by using newer generations of DOCSIS (data over cable service interface specification) technology, cable operators can deliver broadband Internet speeds over their existing last-mile copper wires that outpace what telcos can deliver on their legacy networks.
That's why there has been a spike in billion-dollar spending announcements recently, with Telus announcing similar fibre investment plans for Edmonton and BCE unveiling its own plans to expand its fibre network in Toronto within weeks of each other in June.
Telus has been installing fibre in smaller communities across British Columbia, Alberta and Quebec – where it operates its legacy wireline business – since 2013. It is now taking the experience it gained through 60 such projects (with 28 now fully built) and will apply that to larger ones in cities like Edmonton and Vancouver. The Vancouver project is part of a plan to invest an additional $4-billion in B.C. through 2018.
The company said on Friday the first Vancouver neighbourhoods to be connected next year will be able to access download speeds of 150 megabits per second. In the coming years, it will offer increasingly higher speeds over its "gigabit-enabled network" as demand increases.