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Saudi ordered to end free roaming service

Riyadh, February 13, 2010

Saudi Arabia's telecom watchdog has ordered the kingdom's three mobile phone firms to end a bar on charging a roaming premium on incoming calls made abroad from Saudi-registered phones, the three firms said.

Officials at the CITC watchdog could not be reached for comment.

But Zain Saudi Arabia said in a statement that it would implement the decision as of Saturday and would later announce fees for the service. Kuwait's Zain holds a 25-per cent stake in Zain Saudi Arabia.

Officials at the kingdom's leading mobile phone operators Saudi Telecom (STC) and Mobily also confirmed the CITC decision.

Hesham Abu-Jamea, head of asset management at Bakheet Investment Group, said the move was better news for dominant mobile phone firms STC and Mobily than for Zain Saudi Arabia, the last firm to enter the Saudi market.

CITC issued the decision because many clients had been subscribing to Saudi mobile services while living elsewhere.

Saudi Arabia is home to about 8 million expatriates from dozens of countries.

CITC wants a rate to be fixed for the reception of roaming calls, which will probably be half the cost of an international call from Saudi Arabia, sources at the three firms said.

Analyst Abu Jamea said: 'At first glance this is good news for all the operators because it brings additional revenue. But it will present Zain Saudi Arabia with a problem'.

Zain Saudi Arabia shocked the global telecom industry when it paid a hefty $6.1 billion for a 25-year licence to enter a saturated market where cash-laden operators STC and Mobily - affiliated to Emirates Telecommunications - were already engaged in a fierce turf battle.

Zain Saudi Arabia's argument was that its global presence would appeal to Saudi-based users and help it reshape the Saudi mobile phone landscape. About 15 months after it started business, Zain Saudi Arabia claims an 18-per cent market share.-Reuters




Tags: Saudi | ordered | watchdog | CITC | free roaming service |

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