Internet price cuts fuels demand in KSA

Internet service providers (ISPs) in Saudi are demanding greater bandwidth capacity from the Kingdom’s two governing Internet custodians.

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By  Peter Conmy Published  August 6, 2000

Internet service providers (ISPs) in Saudi are demanding greater bandwidth capacity from the Kingdom’s two governing Internet custodians, if they are to take advantage of a predicted Internet boom generated by recent price cuts.

In mid May, King Abdulaziz City of Science & Technology (KACST), surprised end users and ISPs by slashing its ISPs charges by 45%.

Not to be left out the Kingdom’s sole network service provider, Saudi Telecommunications (STC) announced its intention to bring the cost of Internet access down to five Halals per minute — the same cost as a local telephone call.

“KACST’s price cuts have allowed us to drop our own prices by 50%,” Rashid Al Snan, executive director of Atheer, the jointly owned Batelco/Jeraisy ISP venture, told ACN.

“But the problem remains the lack of capacity, it hinders our goal of achieving the maximum number of users.”

Capacity Problems

The capacity problems facing ISPs exit at two points; STC’s Kingdom wide network infrastructure and KACST’s international connection.

There are conflicting reports from the ISPs about just when they might see some relief, but it appears to be generally accepted that by the end of August, KACST will have resolved its international bandwidth issues.

STC for its part is constantly working to enhance the bandwidth within the Kingdom, but demand is still outstripping supply.

“The bandwidth capacity problem is at two levels, with KASCT’s international connection and with STC’s infrastructure,” said Al Snan.

Restricted capacity makes Web surfing slow for all, but in particular business users needing leased lines are thought to be suffering.

Although STC slashed the costs of leased lines at the start of July by 25% in an effort to encourage companies to go online, the existing digital data network is widely thought of as “busted,” said Al Snan.

Long Delays

STC’s miscalculation of the demand for leased lines has left many users waiting anywhere between four to six months before being connected.

One end user in Saudi has already postponed plans for using the Internet within the business. “We think that the local prices are a little high, but in the company environment you can handle that,” Reda Islam, information systems manager, Yanbu Cement Company, told ACN.

“It’s the quality of service that is not very encouraging. One of our plans with our ERP system was to use the browser… but those plans have to be delayed.”

Echoing calls for transparency from the ISPs themselves, YCC’s IS manager also said that the unscheduled service shut downs made the Internet too unpredictable to run business processes across.

“The problem for company’s in general is dependability, you don’t know when there will be congestion, you don’t know when there will be a scheduled shut down. There is no warning, there is no time to plan,” said Islam.

For information visit: www.atheer.net.sa.

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