City limits

ACN recently met with Dubai Internet City (DIC) executive director, Malek Sultan Al Malek.

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By  Patrick Elligett Published  October 16, 2008

ACN recently met with Dubai Internet City (DIC) executive director, Malek Sultan Al Malek, to get his thoughts on fending off competition from similar vertical-specific IT clusters across the Middle East region.

Can you describe how Dubai Internet City (DIC) has progressed over the past 12 months?

I would say we have maintained steady growth since inception. We have maintained 25%-30% growth, and that's talking about the number of companies in DIC and also the physical presence and property expansion within the zone itself.

So maybe yes we were busy building and attracting IT companies, but that doesn’t mean we were simply a landlord.

Today we have about 1,200 companies after almost eight years. We have maintained the same growth pattern since inception. I think last year we saw around 300 companies. Some of them are very large companies, some of them are medium sized and some of them are small starters. Last year we had Google, BT and Qualcomm.

Are you confident that DIC and Smart City can compete with similar clusters in the Gulf region?

I am always asked this question - will DIC maintain the same image when these other clusters are established in the GCC and in the Middle East? The answer is, now that we have almost completed our eighth year and we have 1,200 companies, we are mature enough not to be compared to a start-up or a new cluster. We want to maintain our position.

We have reached a certain stage where we are the global marker and we need to continue developing DIC to reach the global standard, instead of worrying about these new starters.

Most of these global clusters are also adding value, because they keep expanding the market, they open other markets for our companies.

We have a lot of companies that have their regional headquarters in DIC but have local offices in places like Saudi Arabia, other GCC countries and all over the Middle East. They are not a threat to us. They are in fact good for the overall business, because it opens a new market for our business partners.

The edge many of these competitor clusters have is cheaper land values - is DIC doing anything to address higher rates.

I think that statement is correct outside this area, because we have maintained a very low rate compared to the market, actually way lower than the wider market today. We try not to overcharge the customer, we try to maintain steady incremental goals that maintain the same quality of service that we deliver to the customer.

So if you look at our rate today it is quite a bit lower than the surrounding areas. That is a commitment we have to our business partners, and I think we have managed to maintain it at a good rate. I think our commitment to the industry and to industry creation is there.

We have subsidised a lot of costs to maintain the current growth of the industry, rather than pass on the incremental increases in various areas to our clients.

Do you expect the current rate of growth to continue?

It has been fairly consistent. So we assume that we will continue to grow at the same rate, not only from new businesses but also from existing business partners expanding. We have seen a lot of this in the past three years and have huge expansion from existing companies. A lot of them start very small but because business is good they grow and become a big part of IT in the region.

Does the growth of existing companies outweigh growth from the introduction of new enterprises?

Expansion from existing clients means that these customers have been successful. And most of their expansion will be high on the value chain rather than soft activities.

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