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WRAPUP 3-BCE, Telus wireless results hit by recession fallout

Thu May 7, 2009 11:36pm IST
 
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* BCE, Telus blame economy for denting wireless results

* Telus says wireless subscriber additions down 46 pct

* BCE says consumers using cellphones less amid recession (Adds Telus CEO comments)

By Wojtek Dabrowski

TORONTO, May 7 (Reuters) - Two of Canada's biggest telecom companies warned on Thursday that recession is battering their key wireless businesses as consumers keep a tight rein on spending and use their mobile phones less.

In reporting first-quarter results, both BCE Inc (BCE.TO: Quote, Profile, Research) -- Canada's biggest telecom company -- and Telus Corp (T.TO: Quote, Profile, Research) said that, on average, they are bringing in less revenue per wireless user each month. Both blamed the weak economy.

"I just think people in general are cutting back," said Troy Crandall, an analyst at MacDougall, MacDougall & MacTier. "If they might have wanted that BlackBerry Storm, maybe they're holding off for right now."

Feature-rich smartphones like Research In Motion's (RIM.TO: Quote, Profile, Research) (RIMM.O: Quote, Profile, Research) BlackBerry and Apple's (AAPL.O: Quote, Profile, Research) iPhone have been a crucial driver of profits for Canadian carriers like BCE, Telus and rival Rogers Communications Inc (RCIb.TO: Quote, Profile, Research).

The trend stumbled in the first quarter as customers tightened their purse strings amid widespread layoffs, weak stock markets and general economic uncertainty.  Continued...

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