H108 launch for Zain's Saudi operations

Zain aiming for first half of next year to launch operations; no price war with STC or Mobily says CEO

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By  Ronan Shields Published  November 4, 2007

Saudi Arabia's nascent mobile phone operator Zain will commercially launch its services during the first half of 2008, according to company CEO Marwan Al Ahmadi.

Speaking to members of the local press, Al Ahmadi revealed that he had no intention of starting a price war with existing mobile operators, Saudi Telecom Company (STC) and Etisalat-backed Mobily, both of which currently enjoy an average revenue per user (ARPU) of $33.

Al Ahmadi also predicted that the Saudi Arabian market would hit the 28 million-subscriber mark over the next five years and that mobile penetration would reach 100% by 2010.

In addition the company has also reported receiving 14, 000 employment applications from Saudi nationals, and 20, 000 applications overall, since advertising vacancies in September.

Zain was granted the country's third mobile licence by Saudi Arabia's telecommunications regulator, the CITC, after bidding $6.11 billion for the 25-year concession in March 2007.

The launch of the Saudi operations will take Zain's regional footprint to 21 markets making it the fourth largest telecommunications operator in the world by geographical coverage.

The Kuwait-based company is also considered one of the frontrunners for the second mobile licence in Qatar with the eventual winner to be unveiled later this month.

Zain is also reportedly interested in bidding for a stake in the Lebanese state-owned mobile phone operator where it currently operates one of the two state-owned mobile operations under the MTC Touch brand.

However, Zain Group CEO Saad Al Barrak has been quoted as saying that the $7 billion the Lebanese government hopes to raise through the auctions is "bigger than the value of both companies".

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