Liberalization Drives Network Growth

The Arabian Gulf ICT market is one of the fastest growing in the world with the Middle East telecommunications and broadband Internet sectors expected to generate $70 billion in annual sales revenue by 2015, claim the organizers of MECOM 2008.

“Over the next decade, the GCC countries are planning to spend approximately 25 percent of their infrastructure development funds on the expansion of ICT,” said Trevor Punt, Group Exhibition Director for IIR Middle East, organizers of Middle East Communications 2008 (MECOM) – May 26-28, in Abu Dhabi..

The biggest growth potential for ICT in the region is seen in Saudi Arabia, where the market is being liberalized, and in conflict-torn Iraq, which is quietly building one of the best communications infrastructure networks in the region.

“Overall, information technology spending in the Middle East and Africa is expected to cross $40 billion in 2008 with the GCC accounting for nearly 23 percent of the total, says industry research company IDC. The ICT sector, along with financial services, oil and gas and the public sector, accounts for the bulk of IT spending,” commented Punt.

Several factors are behind the expected ICT growth in Saudi Arabia. The Kingdom’s telecoms regulator estimates the number of mobile users to have risen from just 2.5 million five years ago, to 20 million today. In the coming five years mobile penetration rates in the Kingdom are expected to catch up with the UAE and Qatar and rise to well over 100 percent.

Saudi Telecom (STC) is currently the dominant mobile phone operator. Mobily is second. The new operator Zain is likely to be third with a projected share of between 18 percent and 20 percent. The regulator has also licensed two data service providers, Bayanat Al Oula and Integrated Telecoms, readying the market for WiMax as well as other wireless technologies. There are also three newly licensed fixed line operators: Optical Communications Company (Verizon), Al-Mutakamilah (PCCW-Hong Kong) Telecom Company and Atheeb (Batelco) Telecom Company.

“The number of Internet users in Saudi Arabia reached 4.7 million in 2007. But, in contrast to mobiles, broadband penetration remains low at below 2 percent of the population,” Punt added. “The introduction of WiMax and high speed downlink packet access services is expected to change this.”

Iraq is providing hidden surprises in the development of its ICT infrastructure. By the middle of 2009, the country will have one of the best network infrastructures in the Middle East, according to Bob Fonow, a senior consultant to the Iraqi Ministry of Communications at the US Embassy, Baghdad.

“More than $1 billion in US and Iraq reconstruction funds and approximately $6 billion in private sector investment is resulting in an advanced information and communications infrastructure,” Fonow wrote in a report for the Iraq Development Program. “Iraq’s youth is now part of the global Internet community with up to three million paying surfers and bloggers on WiFi and WiMax networks connected to a robust satellite communications system.”

The Iraqi cellular market is also growing at a phenomenal rate. Market researchers Arab Advisors Group claim that the total number of cellular subscribers in Iraq will exceed 27 million by 2011, with a penetration rate of 89 percent of the population.

ITWorx Opens Office in Riyadh

ITWorx, a global software services organization, has established a local presence in Saudi Arabia. Some of ITWorx’s key customers in the Kingdom include the Municipality of Jeddah, the Ministry of Labor and the Ministry of Health.

“Saudi Arabia is one of the fastest growing ICT markets in the Middle East, and the largest. Our new office in Riyadh puts us where the market needs us, creating an on-the-ground relationship with customers and partners,” said Hafez Hamdy, marketing director, ITWorx. “Our new office allows us to fulfill needs specific to the Saudi market, respond faster to these needs, and build long-term relationships that will help us realize our customers’ business objectives.”

As part of its support of the Saudi initiative toward greater ICT E-adoption, ITWorx will be a sponsor as well as an exhibitor at the Middle East e-Government Conference & Exhibition to be held at the Four Seasons Hotel in Riyadh from March 15-18.

Improvement in e-Govt Readiness

The United Nations Department of Economic and Social Affairs (UNDESA) has released its 2008 e-Government Survey showing all GCC member states significantly improving their e-Government Readiness since the 2005 survey. In this year’s global e-government readiness rankings, the UAE came in 32nd, improving from its previous rank of 42nd; Bahrain moved up from 53rd to 42nd; Qatar moved up from 62nd to 53rd; Kuwait moved up from 75th to 57th; Saudi Arabia moved up from 80th to 70th; and Oman moved up from 112th to 84th. The strong performance by the GCC countries has been attributed to heavy investments in deploying broadband infrastructure, coupled with increased implementation of e-government applications for their citizens.

The UAE also topped the ranking in the region in Web Measurement coming in 12th place worldwide, surpassing fellow GCC countries and many developed countries. This measurement rates the online presence of national websites and selected ministries, which include health, education, welfare, labor and finance. The UAE and Kuwait have upgraded their government portals, with the UAE Ministry of Labor (http://www.mol.gov.ae/) being an excellent example of a one-stop shop facility offering transactional features such as payment by credit card, online submission of forms and permits and the creation of personal accounts. It is also one of the few government sites that have an electronic signature. The Kuwait Ministry of Social Welfare (http://www.mosal.gov.kw) is another example of a progressive website which offers e-mail notification to citizens’ requests, allows online submission of forms and payment and allows online creation of personal accounts.

CIO Executive Summit

Oracle is set to host many of the region’s chief information officers (CIOs) in Riyadh, today. Mohammad Jamil Mulla, the minister of communications and information technology, will make the keynote address focusing on the challenges facing CIOs, namely ROI and the infrastructure demands presented by diversified economies. During the conference a presentation will also be given by Sergio Giacoletto, executive vice president, Oracle EMEA. The event will also see the launch of Oracle’s Saudi Arabia User Group, which aims to enable Oracle customers from around the Kingdom to discuss Oracle’s technology and solutions and how best to leverage their IT investments.

“The Middle East’s CIO community is facing pressure from both the public and private sector to demonstrate significant return on investment around some of the region’s largest technology and business software deployments,” said Giacolette. “While regional enterprises are investing unprecedented amounts into technology to make them more competitive, efficient, and service-focused, the stakes are higher than ever before to ensure that these companies make informed decisions about how to best utilize their corporate information for better decision-making.”

SPS Official Epson Distributor

Epson has appointed Samir Photographic Supply Co. Ltd. (SPS) as official distributor for all its printer products across Saudi Arabia. Early this year, SPS started marketing EPSON Printers in Saudi Arabia through both its own retail venues as well as through partner outlets throughout the Kingdom — including hypermarkets and other premium resellers. The company will offer Epson’s full suite of consumer and business printing solutions to customers across Saudi Arabia.