Atheer to purchase rival ISPs

Atheer is set to take advantage of the thinning Saudi Arabian ISP market by purchasing two struggling operators.

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By  Matthew Southwell Published  September 24, 2001

Atheer is set to take advantage of the thinning Saudi Arabian ISP market by purchasing two struggling operators. Currently under negotiation, the deals may be the first of many as the combination of high prices, low margins and even fewer subscribers has left many ISPs struggling to break even.

“We are increasing our customer base and capitalising on the facilities we have. [We will further] increase the user base by buying other ISPs. We are currently in negotiation to purchase a couple [of ISPs],” says Rashid Al Snan, executive director, Atheer.

Al Snan believes that so many Saudi ISPs are in trouble — and therefore purchase opportunities — because the market has failed to grow as rapidly as was predicted when the original forty-one ISP licenses were handed out. The twenty-nine ISPs that actually initiated operations have been left to fight over a disappointing 300,00 subscribers.

“The main issue is that when [the Saudi Arabian market] started we had a large number of ISPs because investors thought that it was a good business and applied for licenses. However, the competition did not leave any margin,” he explains.

While Atheer looks to buy two of the failing ISPs others are just giving up and leaving the ISP game. Earlier in the year Primanet ceased to trade and Al Snan predicts that another ten of the currently functioning ISPs will disappear within the next 12 months.

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