Telecommunication services in the KSA were provided by the Post, Telegraph and Telephone Ministry up until 1998, when a royal decree was issued to separate these operations from the ministry. The Saudi Telecommunication Company (STC), established in 1998 as an independent joint-stock company became the sole telecommunication services provider in the kingdom. According to the initial plan, STC was to go through a privatization process starting 2000, eventually reducing the government’s stake in the company to zero. Given that the sector represented at the time the second largest source of government revenues after oil, the decision to privatize telecommunications services was a significant event for the Saudi economy. However, when talks broke down over the transfer of a large bulk of shares to the American telecommunications firm, Southern Bell Communications (AT&T), the process of privatization was delayed, and later took the shape of a public flotation.

In 2002, the Saudi government privatized 30% of STC’s capital by floating 20% on Tadawul and offering 5% to a public pension fund and another 5% to the General Organization for Social Insurance in Saudi Arabia.

STC currently provides fixed line, Internet and mobile services in Saudi Arabia, and while it is no longer the only telecom services provider, it is the only integrated operator to offer all three services in the kingdom.