2008 IT agenda

As the new year looms, Middle Eastern enterprises are putting the final touches to their 2008 IT spending plans. But as ACN discovered from a recent IT workshop, regional issues are hampering organisations' desired IT strategies.

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By  Eliot Beer Published  December 3, 2007

The Middle East's IT sector is poised at an interesting point at the moment. On the one hand, forward-looking governments and organisations, in countries such as Saudi Arabia, Egypt, Qatar and the UAE, are pushing the adoption of advanced systems, in business and for consumers. Technologies such as WiMax are seeing commercial deployments in the region well ahead of many European countries, and mobile penetration rates continue to soar, especially in the GCC.

On the other hand, messages coming out of regional enterprises suggest that, as they enter a new year, they feel hampered by issues such as a lack of infrastructure - including power transmission as well as telecoms - and lacklustre support from both vendors and business leaders for technology projects.

This has led to a relatively conservative assessment by some enterprises of what is achievable in terms of deployments over the next 12 months. But while advanced deployments are unlikely, many firms are looking at new technologies keenly, and are constantly evaluating their value.

These were the messages to come out of a recent workshop, held at the inaugural Distree Secure Enterprise Summit (SES) in Fujairah. Participants in the small seminar included IT and finance representatives from mid-sized to large enterprises, primarily based in the UAE, but with operations and business interests throughout the Middle East and Africa.

A straw poll of the participants at the workshop produced an unscientific list of spending priorities for the year ahead - but much more interesting than the raw rankings were the factors the decision-makers were using to form their spending priorities.

External factors

"Communication is a major factor, especially where it's very variable across the region," says K Neelakantan, area financial controller for the Middle East and Africa at Lloyd's Register. "I travel to many African countries, and I find it difficult to log in to our network remotely a lot of the time. We try to carry BlackBerry devices now, instead of laptops - but in most countries it still doesn't work.

"When we spend money, we have to look at each country we operate in. We render a certification service, for example to ships - wherever a ship is, it should get the same service, but unfortunately due to communication this can be difficult."

The issue of inadequate communications infrastructures was common among the participants, with one regional IT manager pointing out the very direct limitations it can put on an enterprise.

"We've been in communication with a regional provider for three years now - because we provide services to our clients both locally and globally. But we couldn't offer them the services that we have in our infrastructure, just like that," says the workshop participant, who asked to remain anonymous. "We cannot take any kind of risk, even to reveal to our clients we have a particular capability. We couldn't give them the concept - say, of a remote office - because it needs to be done through VPN, and how many VPN connections can you do through a 2Mbit/s leased line?

"You then have the risk that the clients will use the service, and drive up our bandwidth costs - if we have to pay for this, where is the profit? So we cannot offer it as a service, as a marketing tool," he adds.

Several participants predicted there would not be substantial movement in the region's telecoms sector, in terms of upgrading and improving available services, and that this would limit uptake of certain key technologies. The suggestion of centralising and virtualising the region's IT systems for one company was dismissed thanks to the lack of available bandwidth.

Regional regulations and barriers to trade were the other main factors identified as impinging on IT planning. One workshop member contrasted the experience of purchasing a server in the UAE - either immediate delivery, or a few weeks' wait if not in stock - to Saudi Arabia, where he said he would routinely have to wait a minimum of two months for delivery.

Derek Holland, head of ICT at Abu Dhabi Media Company (ADMC), formerly Emirates Media, likened the situation to Europe before trade harmonisation came in: "Taking equipment in and out of a country, you'd be stopped at the border and questioned about it, and often told it couldn't be brought in."

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