Courtesy of Intel)
By Mohamed Alaa and Sara Aggour
With the government constantly announcing new plans to develop its information and communications technology sector, Daily News Egypt sat down with Intel’s regional business director for the Middle East, Turkey and Africa (META), Frederico Carvalho, to discuss potential opportunities in the market, the future of tablets, and big data in Egypt.
How do you evaluate the investment environment in Egypt during the current period?
Well, it’s my first time, so I am still getting to know Egypt. But everything that I have heard has been positive and everyone is very optimistic about the future, which is a very good sign.
What about the economic and political instabilities that the region has been experiencing. Do you think that affects the investment environment?
Not from our side specifically. It affects, obviously, foreign direct investments, which try to run away from risks. In our case, it did not really have any effect. We saw a decrease in the volume of computers consumed in the market, but that’s now picking up again and we know that these things take time and then come back. Hopefully, things will continue to be stable.
How much does the MENA region comprise of Intel’s global business?
It is really hard to say, because if you look at the business of Intel, you’ll know that basically our business is around designing and manufacturing processors that get sold in computers. So it is really hard to pinpoint the investment based on the region. I personally don’t have any details, but in terms of contribution to the consumption of technology, we’ve seen the MENA region increase very rapidly. It is one of the fastest growing regions in terms of consumption of mobile devices, as well as software and services.
What about Egypt compared to the MENA region?
Egypt is recovering very fast. In Egypt, I see the market growing in general.
From your presence in the Egyptian market, what are the trends that you’ve been noticing?
We see enormous growth on mobile devices. That is happening across the world and Egypt is no exception. It’s beyond just smart-phones, but also in tablets and laptops. We see mobility growing very fast. As the number of these devices increase, the number of servers [they require] increase as well.
How can you compare Egypt to the MENA region countries in terms of opportunities and challenges?
Egypt is the second largest population in my region after Nigeria. As the economy develops and as the country matures economically, it will be one of the most important countries for us in the MENA region, but my expectations are very high.
Do you have a time expectation for Egypt to become one of the most important?
I wish we did. It seems that the government is taking the right steps and rebuilding the (information technology) structure, which is critical. There’s a plan on the usage of broadband internet and usage of connectivity, which is critical for the development of the country. We see that we are heading in the right direction. It’s very important that we cooperate with the private sector with the incentive of raising awareness and to make things materialise. It is really important to address affordability. Although Egypt may know how to use technology, it can’t necessary afford this technology. So we need to cooperate in order to make that [technology affordability] possible. We are very committed and we see Egypt as a massive potential. If it continues to develop positively, it will continue be a market for us in the future.
What about the investment opportunities you see in the country?
We will follow the market as we did in every single market we are in. If you isolate our manufacturing form our sales operations, you’ll find that sales at Intel are quite different from everybody else because we are not a direct supplier. We are an intermediate supplier and our costumer is the manufacturer. Our sales department is very small compared to other multinational companies. Our role in the country is more of an advisory consultancy, rather than a supplier. We will staff as the market requires.
What is your personal opinion on how the country can attract investment opportunities?
As I mentioned, I am starting to get to know Egypt. Money is risk averse, especially in traditional companies like Intel. The information and communications technology market looks for stability. So stabilising the economy and showing that Egypt is a country that welcomes investments and business development [is necessary]. Also, seeing the government taking a very positive role in the space of technology and promoting the use of technology and developing the skills of Egyptian and making Egypt a very competitive country in the worldwide scale will be the foundation for any company to want to invest in Egypt. And we are no exception
What’s the volume of processers Intel ships to the MENA region annually?
According to International Data Corporation (IDC), the expected size of my region is about 20 million desktop and laptop computers, and if I am not mistaken 300,000 servers. We consult IDC because they track the market and what all manufacturers sell into the market. We need to separate the market between manufacturing and consumption. Manufacturing is when you import components to build products in the country, while consumption is when you acquire finished goods. The figures that I gave you were the overall consumption figures.
The field of tablet devices has been growing during the past couple of years. Do you expect it to outgrow the laptops market?
Yes, the number of tablets worldwide just overcame the number of desktops and laptops. If you compare tablets with personal computers, you’ll find that overall sales of tablets are slightly higher this year than personal computers. What we see is that the growth of tablets is flattening. It was accelerating and now it is just flattening. The reasons [for the flattening growth] can vary. We see that people that are buying tablets are usually people who have already been using technology. So as you have your tablet, you don’t continue to buy tablets every year. That could explain the flattening in growth.
Did tablets takes shares from personal computers then?
The evidence tells us that this did not happen because the personal computers market has continued to grow. If the personal computers market slowed down substantially, we could think about this scenario. We are seeing the personal computers market pick up again and if there was some kind of share taking, it would’ve been temporary.
What are the updates on your operating system, Tizan?
Not much, as far as I know to be honest. There has been on and off interest but nothing really materialised. We believe that the market was looking for alternatives but we haven’t seen any pick up till now.
The government is seeking to use big data. What are the opportunities for Intel in that plan?
Big data is all about capturing, storing and analysing data while extracting insights out of that data and studying the probabilities of occurrences. That requires huge processing power and storage and network to make that possible. We might see increase demand for servers, CPUs, storage and network. We’ve been working very closely with some of the leading platforms, such as Adobe, which is an open source for big data systems.
Do you plan for that in Egypt?
Across the world, yes. We are in constant contact with different parts of the government in Egypt and we have an open channel. We bring a lot of insight for the ministers in terms of big data specifically. We are trying to assist the government with decisions about the best [ICT] solutions and how they could be used.
