I am happy to inform you as a result of this post ArabCrunch.NET http://arabcrunch.net was developed and launched in private beta around 1 month ago to help Arab startups and help the region innovate, continuing ArabCrunch Mission. anyone needs an invite connect me plz

It does seem however that it is turning a little sour and personal and is distracting from the main issues and points of the initial post. Without sounding patronising, I really do think we should focus on combining the talents, thoughts and initiative from all of us and come up with some tangible actions rather than argue over some of the detail.

Personally, I don’t really care who’s right or wrong. I thought the initial post was timely and brought up some interesting points, and it clearly stimulated some discussion. The fact remains that we are behind, in R&D, Venture Capital, Government Support.. we have a low resource of human capital (although improving rapidly), and lack of experience in management and entrepreneurial approaches.

It seems futile to argue over how far back we actually are, or how much support we actually need… or even compare ourselves to everyone else. We have our own circumstances and market, and we should combine forces and focus on tackling it.

I hope my comment is accepted with the good will that is intended and hope I have not caused offense.. I only mean to bring us back to the main points of the topic. Onwards and upwards…

With regards to the data you provided, it’s really nice to see that you’ve finally done some reading up on the topic and told us what we already know. R&D is really lacking in the Arab World, there’s a ton of research on that in the last 15 years, which is why that specifically wasn’t the disagreement.

Lack of R&D can be recited by any person with enough time to attend conferences and listen to speaches, so it’s nothing new. The problem here Ghaith is the way you write; you say the obvious, things that you would hear on the street (or in any conference) but then start preaching about how to solve them as if you actually know. There’s no problem in quoting experts and people of knowledge on those proposed solutions, but you don’t. You didnt’t provide a single credible source when you quote you heard or someone told you.

p.s. the difference between 3,4,and 5 billion is alot, but I can see how that difference may appear trivial to someone who looks at them as simple digits

Thank you.

khair: I said “R&D in the Arab world is also not visible too. So there should be national and regional funds for R&D. A $ 5 Billion regional fund can be a start. This can be done via a small cut from Oil profits and another cut from each Arab country, which would be a healthy start to finance all the needed money for R&Ds and VCs activity the region.”

So this fund is also for R&D why 5 billion, it can be more, but because Arab sovereign funds assets are valued around 2 trillion mostly invested in the west, 5 billion is not a large amount.

You want some data here you go:
WEF:
Number of Patents Registered
Global competitive index.
in the USA, 1976-2002
Yemen 3
Lebanon 4
Syria 16
Jordan 22
Tunis 23
Morocco 65
Kuwait 75
Egypt 104
Saudi Arabia 225
Israel 11,071
Sweden 26,318
South Korea 27,298

Number of utility patents (i.e., patents for invention) granted between January 1 and December 31, 2007, per million population | 2007 global competitiveness index/ World Economic Forum
RANK COUNTRY/ECONOMY HARD DATA
1 Taiwan, China………………..270.4
2 United States ………………..261.7
3 Japan……………………………260.0
4 Finland………………………….160.4
5 Israel ……………………………158.1
6 Switzerland …………………..141.8
7 Korea, Rep. …………………..130.9
8 Sweden………………………..116.6
9 Germany ………………………109.4
10 Canada …………………………100.9
51 Saudi Arabia ……………………..0.8

Research and development expenditure (% of GDP) http://hdrstats.undp.org/en/indicators/128.html
HDI Rank Country 2000-2005
1 Iceland 3.01
2 Norway 1.74598022358616
3 Australia 1.70497399344551
4 Canada 1.93
5 Ireland 1.21
6 Sweden 3.74
7 Switzerland 2.56702710606346
8 Japan 3.14540285993759
9 Netherlands 1.84822798236219
10 France 2.16
11 Finland 3.46
12 United States 2.68
13 Spain 1.10532054929947
23 Israel 4.46
33 Kuwait 0.195154797264097
35 Qatar ..
39 United Arab Emirates ..

Researchers in R&D (per million people)
http://hdrstats.undp.org/en/indicators/129.html
HDI Rank Country 1990-2005
1 Iceland 6,807
2 Norway 4,587
3 Australia 3,759
4 Canada 3,597
5 Ireland 2,674
6 Sweden 5,416
7 Switzerland 3,601
8 Japan 5,287
9 Netherlands 2,482
10 France 3,213
11 Finland 7,832
12 United States 4,605
13 Spain 2,195
14 Denmark 5,016
15 Austria 2,968
16 United Kingdom 2,706
17 Belgium 3,065
18 Luxembourg 4,301
19 New Zealand 3,945

http://oberon.sourceoecd.org/vl=1917787/cl=11/nw=1/rpsv/sti2007/a-4.htm

You want some data about the US and “Israeli” government involvements in R&D here you go:
National Science Foundation (NSF) estimates indicate that U.S. spending on research and development (R&D) totaled $368.1 billion (current dollars) in 2007, up from $347.9 billion in 2006.

>>>In 2007, The (US) federal government conducted $38.6 billion, or 10.5%, (including federal intramural, $24.7 billion, and federally funded research and development centers, $13.9 billion[3]). Other nonprofit organizations performed $15.3 billion, or 4.2%.

>>>In 2005, Israel had the world’s highest R&D intensity, spending 4.5% of GDP on civil R&D, twice the OECD average. Chinese Taipei and Singapore were the only other non-OECD economies with an R&D intensity above the OECD average.
20 Italy 1,213

http://oberon.sourceoecd.org/vl=1917787/cl=11/nw=1/rpsv/sti2007/ga4-2.htm

>>>>“Isreali” government budget for civilian R&D in 2005 amount to about €770m
http://cordis.europa.eu/erawatch/index.cfm?fuseaction=ri.content&countryCode=IL&topicID=329&parentID=50
http://www.nsf.gov/statistics/infbrief/nsf08317/

>>>Arab countries spend less than 0.2% of their national budgets on science and technology research and development. This is more than ten times less than the amount that developed countries spend.
The results become clear if we consider the publication of scientific research papers and/or patent registration. Results of research conducted in Arab countries are rarely published in international professional journals. The number of patents produced by Arabs is meager; during the past two decades, South Korea registered in the U.S. over 44 times the number of patents from all Arab countries combined.”Dr. Farouk El-Baz, member of the U.S. National Academy of Engineering,”
http://www.strategicforesight.com/iwf_farouk_el.htm

More about “Israeli” Government involvement in the “Israeli” tech industry and the Legal Framework -
http://globes.co.il/serveen/globes/nodeview.asp?fid=962

Research & Development Strategy for Information and Communication
Technology, 2007-2009 in Jordan, has some nice info too http://www.moict.gov.jo/downloads/Jordan_RD_ICT_Strategy_Volume_1-Final%20May%203_07.pdf

Khair you said “The US government is only giving money to the auto industry to save it from collapse and therefore the collapse of the US economy because millions of people depend on the auto industry for pension and health car” it also is giving 10s of billions to banks, this crises is a proof that markets are not self correcting, it is not just “only giving.” and as you said save “therefore the collapse of the US economy.”

In 2007, The (US) federal government conducted $38.6 billion, Americans are around 400 million people, Arabs are the same number do not you think 5 billion is not too much? And by the way many Arab governments recognize the lack of R&D activity and funding and the lack of VC funding, you see that in Jordan R&D strategy, also Jordan is gona launch soon a government VC fund, do not you think if there was enough VC they would not launch it? The problem is that every Arab government is having its own initiative for its own country not a pan Arab or pan Islamic one. The regional and pan Islamic work is not a must because we are brothers, but also because it is our future and our national interest that lies ahead.

Khair you said” There are few VCs in the Arab world, but only a handful of startups got funded by them simply because the rest are no viable. Those VCs are crying out for more deals. If you do your research and talk to them you would know it.” I think I answered you many times before I talked to some VCs in the region and also startups, everyone agrees that VC’s mostly in the region do not invest (specially at seed stage), and actually many are not VCs it is not just there are no viable ideas as they (or you) claim, but because its their mentality.
I also mentioned in the post the viable idea problems look at section 1-Entrepreneurs & Opportunities where I suggested how entrepreneurs should think, plus when there are R&D funds we’ll have inventions which can be turned into innovation if you know the difference between both. The ecoy-system I proposed is not a final say it is open for discussion and more points to be added and things are interconnected, I Think at the begging of this post I said “In this post I would highlight a few points that I think can help in creating a vibrant startup-based IT sector in the Arab world “ underscore few points.

Khair you said “I’m not the journalist, so I’m not obligated to support my opinions with data” well if you do not support your opinion with date then do not accuse others of writing “the rants of any frustrated person who blames the microsofts of the world and the governments for everything.” of being “baseless and very superficial this whole article is” and “damaging” “a someone.” And do not through accusations and take words of course.

Khair you said “opinions are written by 50 year olds” this is a jock, I can give you many example of people who achieved great things or taken higher positions when they were much younger, do you not know that Osama bin zaid lead an army when he was 18? Do not you know that Yang started Yahoo when he was in School? Dell? King Hussein became King when he was 18? ….etc

“just blogging (as you put it)” no shame in just blogging, this is a specialized blog not a personal blog, do some Googling to understand what blogs are all about. and just look at blogs stats, over 200 million people visits blogs each month.

“Maybe if you interview or quote some of them to support your views, it would help make this blog more credible and less about just the opinions of Ghaith Saqr, don’t you think?” ya that is coming inshallah, for the VC part. As if you do not think this blog not credible, well I’d not think that the 5 of the top 10 blogs in the world think agree with you. Not to count over a hundred more blogs who cite ArabCrunch as a source for many news.

There are few VCs in the Arab world, but only a handful of startups got funded by them simply because the rest are no viable. Those VCs are crying out for more deals. If you do your research and talk to them you would know it.

I’m not the journalist, so I’m not obligated to support my opinions with data, but if you start looking at the number of deals available in IT, you can start to get the idea that it doesn’t take billions of dollars to fund all of them. The main problem is the lack of viable startups.

Again, I urge you to not write “opinions” but to write well investigated reports. opinions are written by 50 year olds who have seen this and done that in the world, who have started a handful of multi-million dollar companies and succeeded. I would accept opinions from any one of existing successful startups or VCs, but not from a someone who is just blogging (as you put it).

p.s. Maybe if you interview or quote some of them to support your views, it would help make this blog more credible and less about just the opinions of Ghaith Saqr, don’t you think?

Thank you.

The fund number I gave is ya just a number! It is an idea, but again it should be in billions of dollars, Do not you agree? and it is not just a VC fund but Also for R&D as I said in the post, do not tell me we do not need an R&D fund, just google the amount of patents all the Arab countries produced in the last 10 years and compare them to the number in USA, Japan and “Israel”.
U said that “I guess I have a view about the technology industry in the region (investment included) which is much more optimistic than yours” but u did not tell us your view. If you think this post is so damaging go ahead and tell us the truth you know. You tell me how many patents the Arab world produce? How many tech companies get funded every month? How many R&D centers we have in the Arab world? Mention to us one R&D center for Microsoft, Intel, Oracle or IBM that is equal to the size of their centers in “Israel”? If you provide some good info I’ll report that here, and If I posted any wrong info I am ready to correct.

I really wish you would support your opinions and numbers with facts, but you don’t. In your own words you confirmed my guess that this article was not based on any research, which makes your arguments no different than the rants of any frustrated person who blames the microsofts of the world and the governments for everything.

Nobody likes Microsoft or Oracle, but its really not about them or FOCC, but about where you come up with those views… I think throwing a number like 5 billion which -Yousuf asked about- is really an example of how baseless and very superficial this whole article is. Do you know how much it takes to start a VC? do you know how many VCs the Arab world needs right now? and do you even know the amount of deals in the market right now to support those VCs?

Finally, reporting on news is one thing, but doing a long article that talks about the state of the Arab VC environment seems way out of your league if you’re not willing to do the proper “research” (as you said).

I think it’s actually damaging to Arab entrepreneurs to be reading opinions not based on facts. Opinions they can hear if they talk to any frustrated IT person in the Arab world.

p.s. Ghaith, to put things into prespective, I’m curious to know about your background and experience, and why you decided to become a journalist in this particular sector if IT?

Thank you.

@Ahmad Khair I did not establish that u did, i said instead for Arab governments paying millions to Microsoft’s of the world they can use it to train people and advocate open source. Not saying everyone should abandon Microsoft .Net necessarily

It seems that you work for Microsoft! or an undercover MS fanatic look I am not against MS or Oracle, but few of the things which I mentioned here are backed by people who worked with Arab government and aware about things there.
Do not tell me to disclose sources, bc if I do not have permission from the sources to mention their name, then I cannot ethically and professionally. And Habibee, this post is not a research so do not expect everything to be referenced.

if you have something against FOSS remember AC would not be here if WordPress was not free and open source, maktoob would not be what it is today without it. Google, Yahoo, facebook they all use FOSS, Oracle bought Sun for the sake of Open source stuff: Java and MYSQL – separate post with an insider info about Oracle/Sun will be here soon- . The most popular web hosting platform is Linux not Windows. However Microsoft has recognized that startups generally will go for free tools, with its launch of bizpark offering their tools free for starups in the 1st 2 or 3 years of operations. Feel free to elaborate and post ur thoughts but do not expect me to reply back specially if u were being rude or when you mention false accusations.

Also why not, when Arab governments pay millions to these companies make a condition that they should open R&D centers in the region? Thus help in tech transfer and in creating experienced poll of engineers, Abu Dhabi bought around10% of AMD and they will be opening manufacturing or R&D center in UAE.

Any logical man will say for US sanctioned countries like Syria and Sudan, Open source is the only way for them to go since they cannot use propriety software from US companies, right!

Interesting article. One thing caught my attention; you said that (a $5 Billion regional fund can be a start) Do you have an inside info that you’re not telling us ? I’m curious how you came up with this number?

Thanks.

I Don’t sell software, I’m just a developer who happens to love any and all technologies. I guess I have a view about the technology industry in the region (investment included) which is much more optimistic than yours

I have a lot of comments about this particular article -and forgive me if I seem too harsh- but it’s really full of holes. You take one topic, touch on it very superficially -and inaccurately- and then derail into a bunch of unrelated topics which in my opinion are typical rants stemming from some sort of frustration.

If you want, I can elaborate more and maybe you can shed some light on some of the ideas you touched on.

I really enjoy most of your reporting on events and latest news that don’t require alot of thinking of me. But, when I read analysis like this, I am forced to think

Besides many other IT companies at least in Jordan, face problems when it comes to find good techies, whether it is .Net or PHP. And from my experience and from what people have been telling me, the quality of computer science graduates in Jordan is mostly low, I do not know about other Arab countries, but it seems similar. The problem is the IT student does not spend time to learn things.

I do not know how many companies that provides open-source solutions in the Arab world to be honest, but I know a few in Jordan and Egypt. In anycase. whether it is International vendor or an open-source solution. Both need some level of training. So why not spend that money in Open-source training. And the amount of Money the’ ll spend on licenses can be spent in training and using Open-source technologies that are based on homegrown talent, and thus you are not under the mercy of anyone.

Look Syria and Sudan cannot buy Microsoft Windows because of US sanctions; I do not know what they use. But do you suggest using a cracked version of Windows with no support? Or is it better for them to use Linux tweak it and do whatever with it? (PS: I am not endorsing any government here.)

So Ahmad why do not you tell us about your experience? Do you sell to any government? What company you work with?

Your statement was very clear, and is –understandably- a very common mistake people make when they haven’t had that much practical experience –and suffered- in the IT industry… things aren’t that simple.
I don’t think you realize the real issue that comes with adopting opensource in such a large scale org like the government. When the government chooses a solution, they are really looking for a complete “solution”, one that is guaranteed and supported. Adopting opensource in this era means having your own in-house experts. We all know how scarce these are when it comes to open source technologies.
I also think you contradict yourself when you say “I know many web companies in Jordan for example, who adopted open source, struggle to find adequate PHP and Perl developers” when you want our government to run on these technologies ???
I hope when we say opensource you don’t just talk about price. Getting a CMS for free –like Drupal- is just step 1 of 50. Do you know how many people in Jordan –for example- are very capable Drupal developers? On a scale relevant to the needs of a government project, none. Remember, we’re talking about proper Drupal development not what you get from two months of playing around with the modules.

p.s. Sometimes you provide anecdotes from real live examples but you never mention names. Like here you say “I know many web companies in Jordan for example”… and early in the post you say “a friend of mine who is a geek told me” …and then.. “a very senior executive from a well known US based vendor met with a ruler of an Arab country…that country’s official media said ….multi million deal with that country’s government, basically a fat sale for him!”… You always quote anonymous people which doesn’t look good. It’s much better to give names so that these statements can have some credibility.

Always like your stimulating posts… Keep em coming

I said “if an alternative is available.” “1st buy” means favor them, this is not protectionism, and will not demise innovation. I also said they should adopt Open source. Because some countries spend millions of Dollars on non local but on International platforms. And actually the sellers are mostly local agents for international companies.

Why not run the whole government on Linux for example? Would not it be cheaper for them? Moreover does not Linux have the reputation of being more secure and reliable than Windows? We have local companies who can do open source projects in many fields. And besides most International vendors have many Local alternatives from this region. ERP, CMS? And GRP? We all have that, it can be developed using any language, PHP, Perl, and even .NET

There is even open source software for this kind of stuff like Drupal for CMS.
Some will say we do not have enough talent in Open-Source technologies. Well I am not sure at the current curriculum of the IT departments in our universities. But I am sure they do not teach PHP or Unix and Linux. Community colleges in USA teaches those things! We should also teach them in our universities, at least to have open possibilities for the student and the market. I know many web companies in Jordan for example, who adopted open source, struggle to find adequate PHP and Perl developers. Actually most Linux admins and PHP developers are even self learned or took a private course. I would like to point out here we do have open-source talented geeks, but we do not have the right amount of the. So there should be an effort to increase them

hamad tarek made a good point “that all Arab startups need to be treated as contenders without discrimination.” I agree, because many times customers in this matter governments will look high and favor big international brands, so at least treat them as equals, I’ve seen Arab IT companies -and worked with one- that does the same or better than the International rivals.

There should also be R&D investment in military technologies, why? Because many have dual use and can spin off as a civilian innovative projects, this has been the case in “Israel” for example. In this area for instance there should be joint Arab and Muslim R&D efforts in Telecommunications, which can be used for civilian and military purposes. You’ll never know the next Cisco might come from one of these R&D projects.

if you want a good example of protectionism’s downside, look at india before the 1990s where industry and innovation was lethargic because of state protected licenses to private businesses and similar obstacles. only when policy drastically changed and there was open global competition did you see india as a business builder excel.

I have one comment though; I sense a lot of frustration in your post and I think it might be clouding your vision on several topics, namely the issue of “Arab governments should 1st buy from regional based IT companies if an alternative is available”… I believe that will mean the demise of Arab innovation because if we don’t feel the need to compete, we will never innovate. This is proven by all the smart ideas coming out of the Arab world that aim to take a piece of the global market share.

I don’t know why anyone would want to take us back to the 1970′s when local businesses were “protected” from competition and therefore survived with very bad services and products.