Monday, October 20, 2008

UAE ripe for Silicon Valley-type boom

Original Article

The UAE is ripe for a Silicon Valley-style explosion in innovative technology start-ups, the authors of a new report say.

In a study released yesterday, the management consultancy AT Kearney identified small- and medium-sized technology companies as the most likely to benefit from the rapid economic boom sweeping the Gulf.

“Companies here are willing and able to invest, and they want to be innovative, to be the best,” said Dan Starta, a partner at AT Kearney. “You have companies saying ‘I want to be different, I want the next big thing’. You don’t see that in many places, but you would see it on the West Coast of the US, for example.”

An environment that welcomed innovation was an important enabler for the development of a vibrant ecosystem of start-ups in Silicon Valley, Mr Starta said.

While the same conditions are not replicated in the UAE, he believes there are similarities. “The things you had in the Valley were venture capital and close relationships between universities and the industry,” he said. “Here, you have these companies and individuals who want to be unique, they are playing the role of venture capital, encouraging innovation.”

Niche businesses that customise and localise mainstream software, hardware and services were in high demand, Mr Starta said.

With larger businesses working at a breakneck pace and struggling to keep up with demand, the doors are open for smaller companies willing to make the investments and partnerships needed to enter the market, he added.

The report, which was commissioned by Dubai Internet City, said that small, innovative companies targeting the government, financial and telecommunications sectors could all thrive in the current environment.

“The technology industry in the region is the fastest growing market in the world,” said Malek al Malek, the executive director of Dubai Internet City. The special investment zone has become the largest collection of technology businesses in the Middle East, with its model being emulated across the region.

Its success, according to Mr Malek, can be attributed to a simple fact. “We are offering what IT companies require,” he said. Commissioning the report was “an example of the community services we provide”.

The full white paper study will be launched at a gala dinner event during Gitex technology week, an industry gathering that begins on Sunday in Dubai.

Its organisers, the Dubai World Trade Centre, expect 130,000 visitors and say that the sold-out exhibition will feature 3,300 companies from 83 countries.

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