RIYADH, 25 April — The Saudi Telecom Co. will slash Internet rates very shortly in a bid to get more people in the Kingdom surfing the net.
The Kingdom, with a population of 22 million, has only 460,000 Internet subscribers and some 1.2 million users, STC Chairman Khaled Melhem told an e-commerce conference in Riyadh yesterday.
“We will reduce the prices of the service to the lowest level possible. This will be done very shortly. We will make the prices affordable to the users,” Melhem said.
The penetration rate of Internet users in Saudi Arabia is around five percent, or one-third of the rate in neighboring Gulf states.
Up to 70 percent of users are not regular Internet subscribers but use the service “occasionally” through widely available pre-paid cards, according to market analysts.
“The potential in this market is more than six million” users, Melhem said.
Monthly Internet subscription costs an average of $35, while users are required to pay an hourly on-line charge of $1 for the use of the telephone line.
The service is controlled by STC as the telephone line provider, King Abdul Aziz City for Science and Technology (KACST) as the main domain provider and around 30 private Internet Service Providers (ISPs).
The groups have formed a committee to draw up new rates.
Saudi ISPs have already started merging in a bid to cut down on operation costs and upgrade services in readiness for foreign competition.
This month recorded two significant mergers between five of the largest ISPs. The newly-formed companies say they control up to 50 percent of the Saudi market.
Prince Mohammad Khaled Al-Faisal, president of Al-Faisaliah Group — owner of AwalNet which merged with Naseej and Al-Alamiah — said he expected the current number of ISPs to shortly shrink to five or six merged firms.
