ICT Indicators in the Kingdom of Saudi Arabia (2009)

1- Mobile Telecommunications Market:

Competition in the mobile telecommunications market, which started in 2005
with subscribers less than 20 millions has witnessed a very vigorous growth in
the last 5 years , In 2007, the Saudi cellular market experienced the largest
growth in its history. By the end of 2007, the mobile market had added 8.72
million subscriptions , translating to market growth of 44.3% and 116%
penetration. In 2008, the Saudi market continued its growth, but at a slower pace
than in 2007 when the operators added 7.6 million subscribers in 2008. By end of
2009, the total Saudi cellular subscriptions amounted to 44.80 million (175%
penetration) which represents a 43% annual growth. . The majority of these
subscriptions are pre-paid (86%). Figure 1 depicts the mobile subscription
evolution from 2001 to 2009.

2- Fixed Telephony Market:

Figure 2 below shows the evolution of fixed telephone service in Saudi
Arabia from 2001 to 2009. Fixed telephone lines reached 4.171 million at
2009, of which around 3 million or 72% were residential lines. This
represents a household teledensity of around 67%. The population
teledensity is around 16.3% .

3- Broadband Services Market:

The number of broadband subscriptions has grown from 64,000 in 2005 to
over 2.75 million at the end of 2009, a 106% increase from 2008. The
broadband penetration rate stood at around 10.7% of population by the end
of 2009, Broadband household penetration is a more relevant indicator as a
single broadband connection in a house can provide high speed data access
to all members of a household. By 2009, household broadband penetration
stood at around 32% or 32 broadband connections for every 100
households. CITC is in the process of finalizing its broadband strategy and
has also launched a project to promote broadband for an accelerated
growth in broadband penetration rate. When implemented, these will lead
over a period of time towards creating a knowledge economy and an
information society.

4- Internet Services Market:

The number of Internet users grew from around 1 million in 2001 to an
estimated 9.8 million in 2009, as shown in Figure 4. This corresponds to a
cumulative average growth rate (CAGR) of around 35% per year (2001-
2009). Internet penetration increased to 38% of the population in 2009.
This rapid growth is attributed to increased public awareness; growth in
availability of broadband services; decreasing cost of personal computers
and Internet access; and enhanced usefulness of the Internet brought about
through increased availability of local content, of Arabic language sites,
and of e-services such as online banking, e-commerce and e-government
applications.

5- Telecom Services Sector Revenues:

Telecom services revenues(from KSA market operations) have been
steadily growing at a cumulative average rate of around 15% annually,
increasing from around SR 20 billion (US$ 5.3 billion) in 2001 to around
SR 52.5 billion (US$ 14 billion) in 2009. Mobile services revenues
represent around 77% of all telecom sector revenues in the Saudi market.
In addition to revenue from the domestic market, investment by Saudi
licensed telecom companies in foreign telecom markets, have led to rapid
growth of revenue for the sector from foreign operations, from zero in
2006 to SR 455 million in 2007 and to more than SR 14.5 billion(US$ 3.8
billion) in 2009. the local telecom services revenues represents more than
78 % of the total telecom services revenues SR 67 billion (US$ 17.9
billion),

6- Telecom Services Prices and Inflation:

The liberalization of the telecom sector, and the resulting competition in
the market, has led to remarkable benefits for the economy at large and for
the consumers in particular – in terms of increased service availability,
better quality services, improved customer care, more consumer choices,
and lower prices.
While the cost of living index continued to rise in the last few years due to
increased prices of most of its components, the prices of telecom services
progressively decreased.
Figure 6 depicts the relative changes in the overall cost of living index
(CLI) and of its major expenditure groups, during the period 2002 to 2009.
The telecommunications services subgroup is also included in the Figure
for ease of comparison. While the general CLI index increased by around
25% cumulatively over the last six years, with most of its expenditure
groups rising, the transportation and telecom groups decreased by around
7.4%. Most notably, however, is that the telecom services subgroup went
down during the same period by 25.5%.