Services investment increases in Saudi

Growing services and training businesses indicates a rapidly maturing market in Saudi Arabia

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By  Greg Wilson Published  May 5, 2002

I|~||~||~|Saudi Arabia has typified the ultra-cost sensitive nature of the Middle East IT market. However, there are signs that businesses in the Kingdom are becoming increasingly willing to invest in services and human resources. “The market is definitely maturing… more organisations are seeing the value of services and training” says Tarek Abbass, sales & marketing manager, central region, Al Moammar Information Systems (MIS).

“Companies are becoming more sophisticated in their approach to IT projects. The market is shifting towards solutions,” he adds.

Historically, the Saudi market had given a cold shoulder to ‘services’ with many companies failing to see the need for services around hardware or software solutions. But organisations, particularly the Kingdom’s enterprise sites are changing their mindset.

“Services used to be a hard sell and many companies have failed to see the value,” says Sami Said Hassan, executive director, Al Alamiah, Computer Systems Division.

“But there has been a lot of education going on and services is definitely one of the fastest growing areas of the business,” he adds.

Although more organisations are reporting to have cracked the services market in the high end, the small to medium (SMB) segment is still proving to be a challenge. “We have to tune our services for the SMBs within the Kingdom. There is still educational work to be done in this area,” says Abdullah Mohaisen, general manager, Al Alamiah.

Ibrahim Abdullah Al Moammar, vice president of MIS agrees that the SMB segment still has to learn to meld the business needs with their IT strategies. “Although the enterprise market has started showing more interest in value added services the SMB market has still to appreciate such services,” comments Al Moammar.

Several vendors are also reporting that local organisations are more willing to invest in training. The booming training market in Saudi Arabia is being feed by a growing demand for certification. “This is showing the maturity of the market… there is a real drive to get people certified, particularly students,” says Alwaleed Aldryaan, president, New Horizons.

“More corporates are putting in place certification drives within their organisations… they are realising the need to invest in their human resources,” he adds.

However, one training area that has still to take off in the Saudi market is e-learning or web-based training. According to Aldryaan, corporate clients have shown very little interest in virtual learning techniques.

Although much of New Horizon’s online content has still to be translated and localised for the Middle East, Aldryaan is determined to promote its e-learning strategy. “With our diploma we are making students take at least one module online… [Online learning] will take time, however these products need to be pushed into the market,” he adds.

The relatively recent pro-IT approach of several government ministries, particularly on the protection of intellectual property rights has also encouraged many vendors.

The Ministry of Information is thought to be working on another copyright law, which extends intellectual property rights further and provides the ministry with the tools it needs to step up the fight on software piracy.

“We’ve been hearing about a new copyright law for some time, but we’re not sure of its contents,” comments Bilal Sununu, country manager, Kingdom of Saudi Arabia.

“The existing laws have become outdated… The new legislation shows the government’s emphasis on intellectual property rights and the desire to build a software economy within the Kingdom,” he adds.

According to Sununu, aggressive copyright legislation is vital if the Kingdom as a whole is to kick-start its own software economy. “There is a strong corporate development market here… However, with new copyright legislation there is a chance for the Kingdom to start its own software economy,” he adds.Services investment increases in Saudi||**||

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