iPhone may mean big growth at Rogers: analyst

Mon Aug 25, 2008 12:07pm EDT
 
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TORONTO (Reuters) - Rogers Communications Inc could have a record quarter for wireless subscriber growth following the launch of Apple's iPhone and Research In Motion's BlackBerry Bold on its network, an analyst said on Monday.

The two smartphones target complementary segments of the market, with the iPhone aiming for retail customers and the Bold targeted at high-end business users.

"The two hottest device launches to date could lead to the greatest subscriber quarter in Rogers' history when it launches (third quarter) 2008 results," National Bank Financial analyst Greg MacDonald wrote in a note to clients.

"These two products alone will be a huge catalyst to this stock in the coming quarters."

Rogers, the owner of Canada's biggest wireless firm, launched the iPhone on July 11 and the Bold on August 21.

MacDonald said that, given that the average iPhone customer spends about C$90 ($86) a month using their devices, "revenue growth at Rogers Wireless stands to improve, and while initial phone subsidies may pressure margins in the near term, cash flow benefits will quickly follow."

How well the devices perform at luring new subscribers will be closely watched by analysts and investors, especially following the latest set of results Rogers reported in late July. The company said at the time that stiff competition and a slowdown in the wireless market stifled the growth of its mobile phone business.

Rogers' main rivals are BCE Inc and Telus Corp.

Rogers shares were down 34 Canadian cents to C$37.16 on the Toronto Stock Exchange. They have a year high of C$49.81 set in November 2007 and a year low of C$32.92 set this March.

($1=$1.05 Canadian)

(Reporting by Wojtek Dabrowski; editing by Rob Wilson)

 
<p>A man holds his new Apple iPhone 3G at Telcel Center in the eastern Indian city of Kolkata August 22, 2008. REUTERS/Jayanta Shaw</p>