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IDC says Canadian cell phone industry ‘on the mend’

The Canadian mobile phone market shrunk approximately 1% in the second quarter, according to IDC Canada’...


August 12, 2009  


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The Canadian mobile phone market shrunk approximately 1% in the second quarter, according to IDC Canada’s preliminary second quarter Mobile Phone Tracker results, a dramatic sequential improvement which suggests the cell phone industry is on the mend.

 

Handset makers shipped 2.36-million units to the channel in Canada, just shy of the 2.4-millon units sold to wireless service providers and other channel partners in the same quarter last year.

 

The closely watched converged mobile device (also known as smartphone) segment grew 49% in the April to June timeframe when compared to the same quarter a year ago.

 

Kevin Restivo, lead analyst for IDC’s Mobile Phone Tracker in Canada, attributed the smaller market retrenchment last quarter to a greater number of new product introductions, a stabilizing economy and the rebuilding of channel inventory on the part of partners last quarter, which helped drive shipment volumes close to second-quarter levels in 2008.  

 

“The market is slowly recovering from a rocky start,” said Restivo. “The rebound last quarter can partly be attributed to the growing popularity of QWERTY slider messaging phones and smartphones with consumers. These form factors helped the market improve upon the disastrous first quarter.”

 

The Canadian cell phone market got off to a rocky start in the first quarter as shipments to the channel declined approximately 23% when compared to the same prior-year period. It was the largest quarter-over-quarter cell phone shipment decline in 5 years, IDC Canada reported in June.

 

For the year, IDC still expects Canadian mobile phone manufacturers to ship approximately 4% fewer devices to the channel versus 2008 due largely to lower demand caused by the economic recession.