JEDDAH, 11 July 2004 — “Saudi Arabia is one of the major countries both in market size and in the terms of the vision we have of establishing ourselves in the Middle East,” said Aysegul Ildeniz, Intel’s recently appointed regional director for the Middle East. Here on her first visit to the Kingdom, Ildeniz met with her local managers and IT professionals because she wanted to “get a closer grip on the market.”

“Saudi is one of the top four most important countries out of the 80 in the region I am responsible for,” she said.

“More importantly, I am here to talk with our customers and meet industry leaders to understand how the IT industry here ticks.”

As a leading manufacturer of processors, Intel is one of the building blocks of the computer and IT industry. Without chips, nothing will run. It is in the company’s interest that the whole IT deployment in a country is in an advanced state. Ildeniz is fully aware then when Intel builds customer bases in emerging countries where the growth rate is much faster than in the West, it presents an exciting opportunity.

“Half the population under 22 means that in the coming 10 or 15 years, any investment Intel makes in developing the IT sector in this country will be coming back as return on investment,” she said.

Most of the investments Intel makes are strategic. Ildeniz outlined a twin track approach to investment in an emerging market. One is to help the local integrators, the companies who assemble computers: there are almost 2,500 of them in Saudi Arabia. She estimates that in two years, based on IDC numbers, the Saudi IT market is going to be close to $2.5 billion. “That is a sizeable market,” she said, “and 60 percent of that is on hardware.”

The second track is education and support. “At a higher level, we give them the holistic view of which way the world is going from our experience as a global company.”

From the consumer and retail perspective Saudi Arabia is closer to mature markets in that there are increasing numbers of retail outlets. The highest selling area in Saudi Arabia is laptops, with a market share of nearly 20 percent compared with the average 5 percent in emerging markets, suggesting that people are interested in IT, embracing it and are willing to pay for the new technology. “They are not adopting the attitude that they are an emerging technology and don’t need the latest and the best technology,” said Ildeniz. “But they do want the latest and the best.”

PC penetration here is low. Out of 20 million people Ildeniz estimates there are only 1.5 to two million PCs installed. She says there needs to be a critical mass of people using computers and the Internet such that all the services and manufacturing can operate on the Net and via IT. “Then the development level of the country moves one step higher. That’s our goal,” she said

At the national level, Intel works as an advisor to governments. “We know where the technology is going, what is going to happen in three to five years.”

Ildeniz gave the example of the current world trend toward wireless communications. “We are working to develop with partners in the industry a technology called ‘Y-max.’ Today, a wireless card only works in a 100-meter radius. With Y-max you have one station with a 50-km range, no wires and Internet access on broadband.”

Integration of computer systems and convergence technology — where computers and the connected infrastructure all communicate to each — other may be the stuff of science fiction nightmares, but it is planned. “One day, all the communications devices will compute and all the computing devices will communicate,” Ildeniz quoted the CEO of Intel as saying.

Intel is investing time and effort in the strategic initiative of setting up programs to teach teachers to teach children using computers. Called “Intel Teach to the Future,” it’s a long-range program, and negotiations are under way to start the training in Saudi Arabia.

“We have reached more than a million teachers since we started in 2000,” said Ildeniz. Training programs in the target country involve the teachers of primary school children. The teachers can use any content and teach it in a computer environment. The program teaches the teachers how to produce content on the Internet as well as on the computer so that the children learn how to learn on the computer.

“The pedagogical content is aimed at making computers a lot less scary,” said Ildeniz, “to finally create an output that helps the student think for themselves.”