MVNO licence in Saudi Arabia: rules, hosts, launch

Saudi Arabia licenses MVNOs through the Communications, Space and Technology Commission (CST) under regulations adopted as decision 484/1443 on 20 April 2022, with a separate set of rules covering the host operator’s obligations. Four MVNOs are licensed and trading: Virgin Mobile and Friendi on stc, Lebara on Mobily, Salam Mobile and Red Bull MOBILE on Zain. Together they hold about 11 per cent of the subscriber base on EFG Hermes’ estimate, in a market CST put at 68.2 million mobile subscriptions for 2024. Licences have come in rounds rather than on demand, and the last award we can confirm was July 2021, so the first question for a new entrant is whether a window is open at all.

Who regulates, and under which law

The sector runs on the Telecommunications and Information Technology Law, issued by Royal Decree M/106 of 1 June 2022 and in force since 7 December 2022, which replaced the 2001 Telecommunications Law (Clyde & Co, August 2022). The regulator is CST, the former Communications and Information Technology Commission, renamed when space regulation joined its mandate.

Two documents govern the MVNO relationship, both adopted under decision 484/1443 of 20 April 2022. The Regulations of the Provision of the Mobile Virtual Network Operators Services bind the MVNO. The Regulations of the Provision of MVNO Hosting Services bind the operator whose network carries it. Splitting them matters more than it looks, because the obligations that decide whether an MVNO can actually trade sit in the hosting regulation: access, wholesale conduct, and whether the host may favour its own retail arm.

One honest caveat. CST publishes the metadata for both documents but not their text, and we could not obtain either. The figures in the next section come from the 2020 application round and the 2012 public consultation, which CST and the Saudi press did publish. They describe how the regime has been run, not necessarily how the 2022 text reads. At the point of applying, get the current terms from CST and local counsel rather than from a vendor’s article.

What the licence has required

In the 2020 Request for Application round, Saudi press reported a ten-year licence, an application fee of SAR 100,000 and a licence fee of SAR 5 million (Ajel, February 2020). The applicant had to be a Saudi entity with 40 per cent Saudi ownership, consistent with the 60 per cent cap on foreign ownership in telecommunications services described in the ICLG 2025 country chapter, and had to bring a foreign operator partner with relevant experience. Where several foreign partners were involved, one had to hold at least 15 per cent and carry the management agreement. Commercial launch was required within twelve months of the licence being issued.

The 2012 consultation that shaped the first round adds three structural conditions. An MVNO may not be controlled or majority-owned by a licensed host. Each MVNO works with a single host. Each incumbent was obliged to take on one MVNO. That last condition explains the pairings you still see: one MVNO per network in the first wave, a second added to Zain later.

The neighbouring IoT-VNO regime, which CST documents in more detail, shows how the commission thinks about virtual operators generally. Al Tamimi’s 2019 summary describes a Class A licence, limited in number, normally ten years, with commercial launch required inside twelve months. The application package includes a business strategy, a market analysis, a customer service plan, a technical plan and an HR strategy with Saudisation targets. The host’s duties are spelled out: negotiate in good faith, do not price the wholesale service worse than it prices its own retail customers, do not tie the deal to other agreements, and put no technical obstacle in the way of a customer moving away. A hosting permit for IoT-VNO services carries a SAR 100,000 fee on CST’s own service page, and supporting agreements are filed in Arabic.

Four MVNOs, three hosts

Licence dates from Saudi Gazette (July 2021) and Developing Telecoms (October 2014). Trading dates from Argaam (September and December 2014) and AGBI (January 2026). CITC described the 2021 awards as doubling the number of MVNOs in the Kingdom to four.

The two 2014 operators went at the same segment from opposite ends. Lebara launched at what it then put at ten million expatriates, distributed through Saudi Post, and Mobile World Live reports around 2.5 million customers and roughly 30 per cent of the Kingdom’s international traffic. It later moved from a light MVNO to a full one, migrating onto its own core with Huawei in seven months. Virgin Mobile ran two brands from the start, Virgin for a younger domestic segment and Friendi for expatriates, with stc holding ten per cent of the venture. Salam Mobile came from the other direction, launching a consumer service on top of ITC’s existing enterprise base, on an Optiva cloud BSS, and renewed its hosting partnership with Zain through 2030.

A counting note that matters when you read market reports. Some analyst coverage lists Jawwy and Yaqoot among Saudi MVNOs. Those are sub-brands of stc and Zain, not third-party licensees, and market sizes built on the wider definition are not comparable with CST’s count of four.

What the Red Bull MOBILE reversal shows

The most instructive event in this market did not involve a launch. In September 2024 Mobily announced a six-year hosting agreement with Future Networks Communications, the licensee behind Red Bull MOBILE, putting its value at more than five per cent of Mobily’s 2023 revenue and expecting the effect from the fourth quarter of 2025. On 25 December 2025 Future Networks sent written notice discontinuing the project. Mobily told the market the termination would have no material impact on its results or its strategic targets, and that it reserves the right to take all necessary regulatory and legal actions (Argaam, September 2024 and December 2025).

Red Bull MOBILE stayed on Zain. EFG Hermes’ reading, quoted by AGBI in January 2026, was that it had secured a better wholesale arrangement from its existing host. An MVNO’s economics are set by a contract it does not control, and the credible threat of moving is one of the few instruments it has. The threat works only if moving is possible. If the subscriber base, the product catalogue, the rating logic and the billing history live in the host’s systems, there is nothing to move and nothing to negotiate with. We make the same argument at more length in the comparison of MVNO in a box against your own BSS.

Sixteen months passed between signature and abandonment, and no service ever launched. That is also worth knowing when you plan a timeline.

The market an MVNO sells into

CST reported 68.2 million mobile subscriptions for 2024, up seven per cent year on year, in an ICT market it valued at SAR 180 billion. GASTAT put the population at 35.3 million in 2024, of whom 44.4 per cent were non-Saudi. That share is why every MVNO in the Kingdom so far has been built around expatriate communities rather than against the incumbents’ mass market.

The money behind that segment is visible in the remittance data. SAMA figures reported by Argaam in August 2026 put transfers by expatriate workers at SAR 165.5 billion for 2025, a record and 15 per cent above the year before. A mobile brand sitting next to a remittance corridor sells international minutes, data for video calls home and, increasingly, a payment relationship. We traced the same logic for cross-border MVNOs in Africa.

Pilgrimage is the other structural feature, and there is nothing like it elsewhere in the region. GASTAT counted 1,673,230 pilgrims for Hajj 1446H in 2025, of whom 1,506,576 arrived from abroad, and 20.66 million Umrah pilgrims in the first half of 2025, 7.84 million of them from outside the Kingdom. In May 2025 CST, the Ministry of Interior and licensed operators launched instant eSIM activation for pilgrims through Absher with biometric verification. For a platform, a pilgrimage cohort is a specific set of demands: activation in minutes rather than days, a service life measured in weeks, sharp seasonality in provisioning and charging load, and self-care in the languages the pilgrims actually speak.

Rules that reach into the platform

Three Saudi rules land on the platform rather than on the licence application.

The first is number portability, and it is the sharpest. CST’s Regulations for Number Portability between Fixed and Mobile Services, decision 1-195-2025 of 3 July 2025, set intervals that are short by any standard. For mobile numbers the donor must accept the request within 30 minutes and the recipient must activate the service and confirm readiness within 15 minutes. Porting runs through a central electronic request-management system with a reference database of every ported number. Fifteen minutes is not an interval a manual process or a nightly batch will meet, so porting has to be an automated path through ordering, provisioning and the subscriber record.

The second is personal data. The Personal Data Protection Law took effect on 14 September 2023, with the transition period closing on 14 September 2024, supervised by SDAIA. Clyde & Co’s September 2024 summary describes restricted cross-border transfer, registration in the National Register of Controllers for some categories, and a mandatory data protection officer where the core activity involves monitoring data subjects or processing sensitive data at scale. For a platform decision this lands on deployment: where the subscriber database physically sits, and who can reach it, becomes a licensing question rather than an IT preference. The Avante MVNx Suite runs on-premises, in a local cloud or as SaaS for that reason.

The third is localisation, which is the easiest to underestimate. Documents filed with CST go in Arabic, and the VNO application package includes an HR strategy with Saudisation targets. Arabic-first customer interfaces are a commercial requirement in this market whatever the licence says, which for a BSS means right-to-left support in self-care, invoices and notifications, not a translated front end bolted on at the end.

The rest of the Gulf, briefly

Oman has the region’s most developed MVNO segment by share. Telecom Review reported in January 2026 that Friendi and Renna together hold around 19 per cent of the market, aimed at younger and expatriate customers. That is a striking figure next to Saudi Arabia’s estimated 11 per cent, and it survived heavy attrition: of six resellers licensed in 2008, two remain.

Kuwait issued its first MVNO licence in March 2021, to a consortium of stc Kuwait and Virgin Mobile Middle East & Africa (Telecompaper, March 2021). The UAE is a different case. Virgin Mobile UAE, launched in 2017, is a brand of EITC alongside du rather than an independent licensee, and its managing director said exactly that in a Telecom Review interview at the time. Qatar’s regulator stated in 2010 that no MVNO was licensed there, and we found no more recent regulatory source either way. For Bahrain we found no confirmed framework at all.

The pattern across the region is that MVNO segments grow where the regulator obliges hosts to carry a tenant, and where a large migrant population gives a challenger something to sell that the incumbent sells badly.

Before you approach a host

Six things are worth settling before the first conversation with a host’s wholesale team.

Confirm the window first. Licences have come in rounds, so ask CST directly whether applications are open and under which class instead of assuming one can be filed at any time.

Budget the licence separately from the platform. On the 2020 terms, SAR 5 million on award plus SAR 100,000 to apply is a line item with nothing to do with software.

The Saudi entity and the operator partner take longer than people expect. A 40 per cent Saudi shareholding and an experienced foreign operator partner were conditions rather than preferences. Start both before you start shortlisting platforms.

Read the hosting regulation, not only the MVNO one. Non-discrimination against the host’s own retail pricing, no bundling and no technical obstacles to customer migration are the clauses that decide your margin.

Assume twelve months to launch, and start the integrations first. Salam did roughly that. The 2013 cohort slipped on interconnection and on Saudi security requirements rather than on software, which is the pattern we describe in the stage-by-stage launch guide.

Decide what you own before you sign. Red Bull MOBILE is the worked example: the ability to change host is real only if the catalogue, the rating and the subscriber data are yours.

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