Telus to Launch iPhone Soon

Telus Corp (TU - Analyst Report), Canada’s second largest telecom carrier, has officially announced the launch date and pricing of Apple’s (AAPL - Analyst Report) iPhone (3G and 3GS). The company will commence selling the highly popular device on Nov 5, 2009. Moreover, Telus will also unveil its new HSPA (high speed packet access) based 3G wireless networks on the same day to support the iPhone launch. 

Telus will sell iPhone 3G (8GB) for $99.99 with a 3-year contract and for $599.99 without any contract. The company has priced iPhone 3GS (16 GB) at $199.99 with a 3-year contract and $699.99 without contract. The 32 GB version of iPhone 3GS will be sold for $299.99 (with contract) and $799.99 (without contract). 

Canada’s largest wireless carrier Rogers Communication (RCI - Analyst Report) has been the sole distributor of iPhone in the country since July 2008, leveraging its GSM and HSPA wireless networks. However, the company has recently lost its exclusive marketing rights on the device. 

Telus contends with a weakening Canadian economy and domestic competition which is set to intensify with the entry of new wireless players in late 2009 and early 2010. So far, the company is operating its wireless network based on the relatively backdated CDMA technology that does not support the iPhone. 

To upgrade its CDMA network to high-speed HSPA, Telus has collaborated with its peer Bell Canada, subsidiary of incumbent Canadian telecom carrier BCE Inc (BCE - Analyst Report). The upcoming 3G HSPA network will deliver peak downlink speeds of up to 21 megabits per second (Mbps), addressing 93% of the Canadian population. Bell Canada, which will also market the iPhone in Canada, is yet to announce a specific launch date. 

iPhone represents a major opportunity for Telus to boost the performance of its wireless business as the company is experiencing declines in wireless ARPU (average revenue per user) and new subscriber additions. Service deactivations by customers have increased in the last quarter due to the weak economic conditions. 

iPhones have a greater contribution to ARPU than regular handsets, which will foster wireless revenue growth. The device will offer a substantial opportunity to Telus to boost its market share through improved customer retention.