JEDDAH, 3 January 2003 — The sudden hike in the prices of prepaid mobile phone cards SAWA has raised many an eyebrow. On its part, the Saudi Telecom Company (STC) has denied any connection with the price hike and blamed a few unscrupulous SAWA dealers for the phenomenon.
An STC official told Arab News that STC has nothing to do with it because it is selling the cards from its head office in Riyadh through approved agents across the country. “Those authorized distributors’ role is to sell the cards to thousands of retail outlets all over the country for a specific commission they get in return” he said.
There is, however, a possibility of close link between the authorized agents, who stock a large quantity of SAWA cards, and retailers who sell it on the black market at a premium of 13 to 15 percent.
A visit to the crowded mobile phone market on Palestine Street would convince one of the bargain deals that occur there daily between customers and black marketers who wait outside the retail outlets to lure customers.
Reacting to the sudden increase in SAWA card prices, Thamer Al-Ali, who was looking for a new card for his wife, said: “I am really shocked to see prices vary from place to place. I was told that prepaid mobile phone cards are sold in some outlets for SR120 but I had to pay SR150 which really amazed me as a SAWA user.”
Bandar Al-Harbi, another SAWA card customer, told Arab News that there was apparently a shortage of prepaid cards but he did not know who to blame. “Ten days ago, I went to buy a card and could not find it anywhere because SAWA cards had disappeared from retail outlets amid news that SAWA cards were available everywhere. But the next day I found it as being sold for SR140. As far as I know it is an artificial shortage created by dealers whose intention is to raise black market prices,” he added.
Khaled Tamimi said that the sudden price hike has prompted many people to hoard as many as they can for around SR120 and sell them later at SR150.
A retailer, who refused to be named, blamed STC for the high prices because it did not distribute enough mobile phone cards in the market. Retailers took the advantage of that and jacked up the prices.”
Naser Hamdan and Waheeb Al-Abdaly blamed STC for not taking immediate action against violators despite continued calls by retailers and card users. “STC promoted the black market indirectly because it did not impose tough restrictions on dealers and did not even dare interfere to stop violations.”
Hamdan Al-Selami, owner for a mobile phone outlet, said the price hike has created a big problem with customers. “We are not responsible for what is happening because distributors are selling us SAWA cards at high prices. Earlier, cards were sold for SR95 but recently it was hiked to SR100 which forced us to sell at a higher price in order to make a reasonable profit,” he said.
