Feature: The UAE and California's much heralded Silicon Valley region may be closer than you think.
Web of inspiration
They are thousands of kilometres apart, but the UAE and California's much heralded Silicon Valley region may be closer than you think. First, the two areas are flooded with potential sources of capital and the financial backers holding the purse strings have made lots of money by spotting profits in a world of risky ventures. But if there is one thing Silicon Valley has that many other high-profile financial hubs have struggled to duplicate it is a sense of community, a spirit of innovation and idea-sharing that has cultivated such powerhouses as Facebook, Google and Yahoo. It is tapping into that one missing element that could help create an internet developer base in the region, ultimately driving in billions of dirhams of revenue. Finding that key piece has spurred the application developer Rida al Barazi to launch Submit 2009, a conference in Dubai next month aimed at fostering ideas among the region's internet entrepreneurs. "The community is not that strong yet and I think it's because the market doesn't recognise the need for good developers or designers yet," says Mr al Barazi, a partner of SpinBits, a web consultancy based in Dubai. Failure so far to find that community is not from a lack of effort on Mr al Barazi's part. Along with his SpinBits partner, Cloves Carneiro, he has held several DemoCa grassroots developer meetings in Dubai and Saudi Arabia. And it certainly feels like the time is right to be an Arab web entrepreneur. The Internet Corporation for Assigned Names and Numbers (ICANN), the governing body that oversees the internet addressing system, plans to introduce Arabic-language domain names in May while the UAE leads the world in mobile adoption with almost two mobile phones per person. There have been some successful start-up ventures in the Arab world, with the media portal Maktoob and the web software developer Koein prime examples of Middle-Eastern ingenuity. But there could be many more success stories, especially given the area's propensity for mobile usage, says Ryan Carson, a speaker at the conference and co-founder of Carsonified, a web consultancy based in the UK. With Facebook recently launching an Arabic-language version of its highly popular website, Gulf entrepreneurs should not have to wait for the West to cater to the Middle-Eastern audience, he says. "I'm surprised no one has created an Arabic version of Twitter. Given how big texting is in the area, that could be huge. It's almost as if what is happening in the Middle East is behind enough that there is going to be a huge gold rush in the next five, 10 years specifically related to web tech. There are probably thousands of niches available for Arabic-speaking people that the West is ignoring." Having an idea and the technical know-how to bring it to fruition is one thing, but like all other businesses capital is required to commercialise a web-based business, something that has been lacking in the area, says Mr al Barazi. "The overall challenge that you face is not only from getting your clients but also from the support of banks for e-commerce," he says. The lack of funding has hindered start-ups, says Dr Ashraf Khalil, a computer science professor at Abu Dhabi University. "The internet altogether has been ignored in the Middle East and we rely heavily on what the West gives us. We don't see a lot of creative ideas coming out of this area. It's not because of the lack of talent, it's the lack of will and very little investment being put into that area." Dr Khalil adds that investors should begin to create venture capital funds and educate entrepreneurs on how to take the right risks. "Not every country is willing to take such risks," he says. They want something risk-free. But we are ready for it. All of the elements are there. We just need more focus and will. It's fertile land for entrepreneurs, for sure." Industry watchers agree that if there is one other element that has prevented the Emirates from being thrust into an internet gold rush of its own, it is the dearth of broadband usage in the region. Only 528,000 people, or about 11 per cent of the population, has access to high-speed internet, according to the Telecommunications Regulatory Authority. The Middle East also has one of the lowest broadband adoption rates worldwide, at 5.6 per cent, whereas North America and western Europe are about 26 per cent, the research consultancy TeleGeography says in a recent report. However, with the exception of Cyprus, the UAE leads all other Middle-Eastern countries in broadband penetration. If the costs of broadband for users were reduced, not only would it attract more developers to the area but it would also create an influx of potential customers who could easily access sophisticated web-based applications, says Said Irfan, the research manager for telecoms for the consultancy IDC Middle East. "These entrepreneurs need to have the type infrastructure that actually helps deliver those types of services to the market," he says. If the right tools are set in place, the seeds of innovation could blossom in the area. As Mr Carson puts it, the next major business application, social media website or green technology breakthrough in the UAE could be just moments away from reality. "As [the price of] oil decreases, a lot of people are probably going be to thinking that they need to find a different business model and could switch their focus to tech in general," Mr Carson says. "There are billions of dollars to be made in that specific market and I think the UAE could lead the way there." email@example.com Submit 2009 will be held at the Habtoor Grand Resort & Spa on April 8 and 9. Registration costs US$800 per ticket. For more information on the conference, visit www.submitconf.com