Google and Egypt Signed a $10 Million Deal

26 Jun, 2009

UPDATE: More details of the deal at the end of the post.

WebProNews reports that Google and the Egyptian Ministry of Communications and Information Technology have signed a $10 million contract regarding business and workforce development in Egypt.  According to the site the deal was signed in Washington D.C during the Egyptian Minister of ICT, Dr. Tarek Kamel, visit this week along with a representative for the Information Technology Industry Development Agency (ITIDA) .

WebProNews news says that The Google deal was made for the promotion of Egyptian products and services using Google’s advertising platforms. And under the agreement, Google will invest 25% of the money back into the Egyptian economy. “Over the medium to long term, Google’s USD $2.5 million investment agreement may include: growing digital media start-ups, incubation venture capital, angel funding of the ICT sector and potentially training students in online advertising.”

So this seems like Google is winning a major advertiser for its Adwords (and possibly DoubleClick) in the region, however giving back 25% of the deal to support entrepreneurship in Egypt is something great for Egypt’s IT sector and the Arab region in general, and something that we at ArabCrunch applaud Google for. I’ve never heard of any International tech company giving some money it makes from government deals in the region back to help the IT startup seen of that country (excluding AMD). I know Intel, Cisco, and Microsoft offering many initiatives to support in bridging the tech divide. (Sun Microsystems donated several servers to universities in Jordan during the last years.) But these were not cuts from a deals they made, if anyone knows otherwise please let us know.

I encouraged before here on AC and else where; Arab governments to ask International IT companies to open R&D centers when they consider buying their solutions with millions of dollars. We need R&D centers in the region because they transfer technology and skills that are very much needed to take the IT industry in the region to its next level. I’ve heard that the Emirate of Abu Dhabi has plans to open a chip factory for AMD in UAE soon, since it has acquired about 20% of AMD through its sovereign fund vehicle Mubadala Development.

Google has been moving strongly in the region with new products and initiatives, such as Google Online Business Plan Award with Queen Rania Center for Entrepreneurship. That’s why ArabCrunch has added a new Category titled “Googlewhich marks Google’s related posts in our Category list.

I’ll contact Google to get more details of this deal and update you here accordingly.

Update 1: According to Wael Ghonim, Google’s Product & Marketing Manager, Middle East & North Africa, Egypt will promote by using Google advertising technologies the following sectors: Tourism, IT and Industrial Business.

Campaigns will have a global nature and will target audience in US & Europe as well as the Arab countries. He added nothing has been decided yet in terms of the details, but the ad campaigns are expected to be combination of text / display ads. Sources say MCIT will be managing this for all the different Egyptian ministries, and there will be different landing pages created to brand Egypt and specific businesses. Egypt has been doing a nice job online with sites such as Egypt Memory and Eternal Egypt web sites.

As for the $2.5 million reinvestment, sources say it is part of MCIT policies (so it’s not specific to Google), this is what Microsoft also do in Egypt .

“We are really excited about this partnership as we are committed to add value to Egypt.” Said Wael.

An email will be sent to Egypt’s MCIT to get a better understanding about the reinvestment policy.

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  1. Amad  |  June 26th, 2009 at 10:46 PM #

    Good Stuff Gaith..

    These type of transactions happen all the time, but maybe not in such a clear setting. For example, I work for Boeing, and when we sell airplanes to India or China, they always put a condition to get some of our supply procurement from their markets, or to build some parts in their markets.

    Great step by the Egyptian Minister, other Arabs should follow. I agree that we need more technology transfer, but more importantly we need knowledge transfer. Bringing an R&D center to the region without employing local professionals won’t do much. Even if we do get some jobs, that also is not enough. We need to learn how to do reverse engineering to make sure that we capture the knowledge and the execution capability.

    Here is a good question for everybody:
    How come Intel, Cisco, Motorola, Yahoo, Google, etc.. have R&D centers in Israel, and they only have Sales & Customer support centers in the Middle East?

    Please, don’t bring politics into the topic – keep the discussion in the realm of technology and economics !

  2. Gaith Saqer  |  June 27th, 2009 at 12:19 AM #

    Thank you Amad, I updated the post, yes it seems this is a policy in Egypt. However in Jordan, where I am from does not have this policy, since many years Microsoft struck Multi Million deal with our government, and we did not see any reinvestment, they say we are giving yoi open licenses, “ya I can get free licenses from Linux” just recently they are opening an innovation center at Al Hassan science city, but it is small and they have it in Egypt already, they also launched BizzSpark, but BizSpark is a global initiative by MS not specific to the region.

    I’ve visited early this year MS innovation center in Cairo, the people who work there are nice and smart, one of the managers have several patents, (The Microsoft innovation center in Egypt is “interested in applied research and development initiatives in the Middle East and Africa “and they have a small team about 17, mostly c++ geeks, http://bit.ly/2Ud7k they also have image cup competition).

    But there are no massive R&D centers like the ones these companies have in “Israel”. I totally agree with you “we need R&D center that employing local professionals ,doing things such as reverse engineering to make sure that we capture the knowledge and the execution capability.” This will help create the poll of engineers than can then come up with new innovations and start their own companies. –point= “Israel” between “ “ not a political statement but to point out it is a conflict area/name-.

    I did a research back in the day about the IT sector in “Israel” for a class at university, to sum it up these people had polices to help the tech sector since decades, they deployed different plans and projects since back in the day, in the Arab world all the tech talk is recent, or at least some actions are happing recently. In “Israel” for example, they have a position called the Office of Chief Scientists, does any country has such a position? One of the success factors for the ICT industry in “Israel” is its military, where many eng. developed or worked in some telecom systems for the military for example , in which later they span off for civilian use.
    The problem is that each country is doing it alone, they have not figured a regional plan to support Tech innovation yet, if they agree and lobby I do not think Multinational IT companies won’t open R&D centers in any suitable Arab country.

    You can read my post about the IT industry and the edgy discussion here: http://arabcrunch.com/2009/04/towards-a-vibrant-startup-based-it-sector-ecosystem-in-the-arab-world.html

    This website
    http://www.globes.co.il/serveen/globes/docview.asp?did=258636&fid=954 has good info about IT sector in “Israel”. Lailatov :P .

  3. currency  |  June 27th, 2009 at 5:05 PM #

    Pra quem tem Google Earth as coordenadas da ilha do LOST : COORDENADAS 4,8,15,16,23,42

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