Q4 Wireless Forecast

The competitive landscape, uncertain retail environment, weakening consumer confidence and how much they are actually willing to shell out makes predicting trends all the more difficult in 2009.

The fourth quarter for Canada’s wireless sector likely started off strong in October, slowed in November, but sales picked up in December as a result of the holiday season, according to UBS analyst Jeffrey Fan. Overall, he estimates that industry postpaid net subscriber additions were up 10% year-over-year in the quarter, a slower pace than the first three quarters.

Mr. Fan said in a research note:

While subscriber adds should not disappoint, the key focus will be on average revenue per user (for wireless and wireline/cable), which could see greater impact from the economy.

For Rogers Communications Inc. (RCI), which releases subscriber results on Jan. 6, the analyst said the iPhone remains a strong seller. He raised his estimate for the number of Apple Inc. (AAPL) smartphones sold from 155,000 to 200,000, with roughly one third coming from new subscribers.

“Although it seemed the Fido re-branding got off to a slow start, our checks indicate that popularity picked up later in Q4,” Mr. Fan said, adding that Rogers likely gained postpaid market share to 49% this quarter. BCE Inc. likely saw its share fall to 20%, UBS estimated, as “momentum slowed in Q4 due to credit system checks which led Virgin customers to choose prepaid.”

Kodoo continues to do well and checks confirm that it remains a popular choice among low-end plans, Mr. Fan said, noting this should help Telus Corp. (TU) maintain its 31% market share. However, BlackBerry Storm shipments have been limited since its release, with some stores receiving few or no units.

Meanwhile, engagetmobile.com is reporting that Sprint (S) is looking to release the BlackBerry Niagara sometime this quarter. This is the CDMA version of the Bold, which should please Telus and Bell customers waiting in envy of their GSM counterparts for a successor to the BlackBerry 8830.