IDC Announces Opening of New Regional Research Center in Egypt

Egypt's ICT Minister witnessed the signing of the agreement between IDC and ITIDA during Cairo's CIO Summit International Data Corporation (IDC) today announced the opening of its dedicated new office in Cairo's Smart Village. The global technology research and consulting services firm says a number of analysts and consultants are already on board and that recruitment efforts are continuing after today's formal inauguration at the IDC Egypt CIO Summit 2016, which took place at The Nile Ritz-Carlton Hotel under the patronage of H.E. Yasser El Kady, Minister of Communications and Information Technology.

The new office was officially launched by members of IDC's senior management in the presence of representatives from Egypt's Ministry of Communications & Information Technology (MCIT) and IT Industry Development Agency (ITIDA).

According to IDC's latest forecasts, the Egyptian ICT market is expected to total around$8.95 billion in 2016 and grow to $10.32 billion in 2019. Much of this growth will be driven by spending on IT services and packaged software, which are expected to experience compound annual growth rates (CAGRs) of around 9% through to 2019. And as the country emerges from its previous period of transition, the economy is expected to demonstrate solid economic growth under the new government, spurred by significant reforms and external investment.

"I'm delighted to witness the launch of IDC new research office in Egypt, thus supporting expansion and job creation for highly-skilled research professionals," says Yasser El Kady,Egypt's ICT minister. "The MoU comes as part of Egypt's endeavors to attract foreign direct investment and is clear confirmation that the country has evolved into a high-end service delivery favored destination for Europe, Middle East and Africa,"

"Capitalizing on the increasing level of investors' confidence in the ICT sector, Egypt is currently implementing a developmental strategy to establish technology parks across the country that serves as a catalyst for Egypt to become a leading, globally-recognized hub for electronic design and ICT innovation," the minister added.

Together, ITIDA and IDC have successfully developed and executed programs that encourage cooperation between Egyptian IT players and the systems integrators and solution providers they need access to in order to thrive in these target markets. Bundled with unstinting access to IDC's expert analysts and research capabilities, the partnership is enabling ITIDA's mission to promote trade in international markets and become a strategic advisor to local, regional, and global companies.

"Egypt is a natural fit with IDC's strategy to invest and grow its presence across the Middle East and Africa," says Jyoti Lalchandani, IDC's vice president and managing director for the Middle East, Africa, and Turkey. "IDC has been researching the Egyptian ICT market since the mid-1990s and our research coverage today encompasses the entire spectrum of the industry, including hardware infrastructure, packaged software, IT services, telecommunications, vertical markets, and our recently launched IT Executive Programs, which have been designed with the specific needs of CIOs and IT leaders in mind. In light of this expanded coverage, it made perfect sense for us to open our new office here alongside the second annual IDC Egypt CIO Summit, and I look forward to making a further announcement about our new Country Manager in the coming weeks."

The new office is not IDC's first foray into the Egyptian market. Indeed, over the past few years, IDC has been supporting ITIDA to promote Egyptian IT and ITES companies in export markets across the GCC and Africa.

SOURCE IDC International Data Corporation

Egypt: Expanding technology infrastructure | ICT | Africa | Oxford Business Group

The government is reaffirming Egypt’s commitment to the planned expansion of its broadband infrastructure, in the hopes of spurring new development in technology-based industries. ICT has grown rapidly in Egypt over the past decade, both in terms of take-up by Egyptian consumers and outsourcing and offshoring activity.

OBG

In March 2013 Atef Helmy, the minister of communications and information technology, announced that the first phase of Egypt’s broadband strategy, initially unveiled a year and a half ago, would be completed as expected within the coming two years. The strategy, known as eMisr, focuses not only on infrastructure, with an emphasis on developing high-capacity connections at public venues such as schools and health care facilities, but also increased data storage and access for government agencies.

eMisr was launched in November 2011 with a range of ambitious goals to be met by 2015 and 2021.

Formal implementation began in July 2012 when various task forces set about planning exactly what needed to be done to meet those goals. Around $2.4 bn of public and private investment was envisaged in the first four years of the plan. The eMisr roll-out is expected to generate 11,000 jobs per year and support broad-based economic and social development.


Particularly as Egypt is struggling to re-gain economic momentum, these sorts of enabling investments can have a broad range of positive externalities (In economics, an externality is the cost or benefit that affects a party who did not choose to incur that cost or benefit.). Research by the World Bank has suggested that a 10% increase in broadband penetration can yield an extra 1.38 percentage points of economic growth in emerging markets.

The World Bank

Meanwhile, a report by telecoms firm Ericsson and Sweden’s Chalmers University of Technology, published in September 2012, suggested that doubling Egypt’s broadband speed would lead to a 0.3% rise in GDP worth almost $688.59 m, while quadrupling internet speeds would add around $1.38 bn.

It has not, of course, been all smooth sailing. As a result of the broader political uncertainty, pending reforms in the telecoms sector, and the cost and technical challenges of upgrading infrastructure, some goals set for 2015 have been pushed back by at least one year. Initially eMisr estimated 75% of households having access to 2-Mbps broadband and about 98% of the population to have coverage by mobile 3G networks by 2015.


Ensuring physical connections has been one of the primary hurdles to increasing internet penetration. Helmy’s predecessor, Hany Mahmoud, said in October 2012 that infrastructure was the biggest challenge to broadband development. In this regard, Telecom Egypt (TE), the legacy fixed-line operator, was in the process of converting its copper cables to fibre-optics. Plans have also been in place to encourage greater fixed-line competition between TE and the three Egyptian mobile operators, which hitherto has been a monopoly by the 80% state-owned TE.


As well as supporting broader GDP growth, expanding broadband capacity should help Egypt’s export-oriented ICT service sector, particularly the outsourcing and offshoring segments. In recent years, Egypt has become a favoured destination for international companies establishing business and knowledge-process outsourcing centres. Consultancy AT Kearney ranked Egypt fourth in the world on its global services index in 2011.

New investments, however, have been sluggish since the revolution, but with greater political and economic certainty, Egypt’s competitive advantages should re-assert themselves. They include location, a sizable pool of well-educated and multilingual graduates, strengthening international cable connectivity, relatively low overheads, and government support. In March 2013, Helmy announced plans to establish two technology parks in Upper Egypt to support the development of ICT – and specifically outsourcing – in the region.


Karim El Fateh, the country manager at Intel Egypt, told OBG that he sees three challenges for the industry. “Firstly, increasing broadband connectivity, including looking at ways of reducing cost and making the service more affordable, through either monthly or data subscriptions,” he said. “Secondly, increasing local content and applications, and creating the necessary infrastructure to foster innovation of local content, specifically in education, entertainment and services, as innovation can enhance competitiveness, diversify industries, and realise all the benefits of the rapidly expanding market. And lastly, developing financing mechanisms that will allow for commercialisation of our research, innovation and development through the use of private or public technology incubators and investment funds.”


Achieving these goals will require a degree of political certainty and private sector will to invest, both of which have been in short supply in Egypt recently. However, the government and the private sector are both clear about the need to strengthen ICT infrastructure to support domestic demand and economic growth, and to help the export-oriented sector regain its competitive position.


Source: http://www.oxfordbusinessgroup.com/