Software Business in the Middle East

Time to time you might see really interesting events taken place in Dubai. One of them this week was a meeting with Craig Barett, the chairman of Intel.

It’s always interesting to listen to the people who have managed to make such amazing carrier as Craig – to see how they think and what they are doing at the moment. In his 69 Craig has clear mind and he seems having a lot of energy living very active live.

Below are just a few excerpts from that meeting.

History of Intel

The company was founded by Robert Noyce and Gordon Moore. At that time it was not very common to get funded by venture capitalists – entrepreneurs borrowed money from banks. It was kind of difficult task for Intel founders to get money from a bank as their first business plan consisted of less than 180 words. Somehow they managed to find their first investor – Arthur Rock, whom Craig called as the first venture capitalist in Silicon Valley.

Arthur Rock, by the way, was also an early investor in Apple – it seems this guy has an excellent sense of the right investment.

Entrepreneurship

There are three things needed for successful business – smart well educated people, smart idea and right environment. As an example, three large challenges for Microsoft didn’t come from other big competitors. The large challenges came from individual people who invented Netscape, Yahoo and Google.

Culture and Entrepreneurship

Craig had interesting discussion on how culture affects a number of people who want to start their own business. In Mexico, for instance, it’s not allowed to have a failure. If you fail, you become a looser there – so there are not so many people who want to take the risks. In other countries, where failure doesn’t mean bad thing, there are more people who become entrepreneurs.

It is good not to be afraid of failure, anyway.

Investments into Education

It is almost impossible to calculate the return of investments made into education. Probably, these investments are returned back one day when graduates start working for the company. Or graduates keep using the same products of the company in their daily jobs as they used to during their studing. But formally, there is no proper way to calculate if there is any return.

I appreciate the fact that Intel shareholders, according to Craig, have never expressed any concerns about investments made by Intel into education despite the fact that it is impossible to measure the profit.

Wal Mart in India

Somebody from the listeners asked the question about the protests against Wal Mart entering the Indian market. People over there have serious concerns that Wal Mart will kill small retailers.

Craig suggested to look at the situation from the consumer’s point of view. If Wal Mart gives no value to the customers, then it will definitely die. But if customers go to Wal Mart to buy stuff, it means Wal Mart adds some value for them. As result, small retailers might get closed. But at the end of the day it is a consumer who wins.

______________________
RSS Subscription for this blog

(c) Picture from ArabianBusiness.com.

The list of the most influential Arabs in the World has been published.

It is not very clear what they actually mean by word “influence”. In the original article they say it is a kind of ability to affect thoughts and behavior of other people. Or “if one man dyed his hair green, how many others would follow? The more that did, the more powerful that man is.”

It doesn’t explain much about how to measure the influence, especially remembering how some magazines used to award the best software solutions or best small companies in the region – kind of example from here. But I hope this list is compiled by serious people with serious arguments.

The leading position in the list is kept by Prince Al-Walid bin Talal for the past four years . The World’s Most Powerful Arabs list is divided by countries and industries. There are only seven persons from Technology, and three of them are from UAE:

Mohammed Omran – the chairman of the leading mobile operator Etisalat that was the only mobile operator in the country until 2007.

Ibrahim Sharaf – the first person from UAE who will take the journey into the space by 2009.

Osman Sultan – CEO of the second mobile operator du in UAE.

Despite the fact that members of the royal family are not normally included into the list, this year you will find HH Sheikh Ahmed bin Saeed Al Maktoum in it. As they say, it’s only thanks to his business achievements – being CEO of Emirates Airlines, he led the company to become the most profitable airline in the world with the ambition to become also the largest airline company. As part of company growth, on the past Paris Air Show Emirates Airline made a purchase of 93 airplanes for about US$23 billion (via ArabianBusiness.com)

______________________
RSS Subscription for this blog

I’ve read these two articles in March about software piracy in the Middle East: Saudi company’s pirated software leads to SR5 million lawsuit and Oman reseller jailed for software piracy.

Undoubtedly, software piracy is evil. You start understanding it clearer as soon as you start selling your own software. Large companies like Microsoft lose millions, if not billions from it.

But if you cannot fight the piracy, you can probably try turning it out for getting more sales in the future. It might be a kind of marketing that costs you almost nothing. I’ll give an example from our experience.

In the first version of our software we made a license key linked to the hardware where software is running – I wrote about it here. Also, we had activation over Internet or phone to make sure that each license key is activated only once.

Everything worked just fine until we had started our sales in Saudi Arabia. It seems that Internet is not yet very popular thing over there. It cost a lot of time and efforts to activate licenses over phone. And it cost a lot of money too. Finally we found ourselves working a lot on license activation rather than on making new cool stuff in our software.

After all, we have changed our licensing policy. Now it is very simple – user enters the license, and it is registered on our server automatically. This way we get statistics about how many times each key was activated. If customer has no Internet, then software gets activated on the user’s computer anyway, so we don’t get any phone calls asking for activation.

Recently one of the universities purchased a license for using our product in their computer class for the Faculty of Pharmacy. Next day I saw the license activated 8 times, couple of minutes one after another from different IP addresses – couple of minutes is just enough to install software on a new computer and enter the license key.

Does it mean we lost money? Yes, we did. In short run. But in long run I don’t really think we’ve lost anything. The university might install the program on one single machine, as they’re supposed to. Probably, they would purchase couple more licenses if they didn’t want their students staying in the queue waiting for the moment they could use the program.

But in fact, those 7 unlicensed copies of our software in the university class is just very huge benefit for us. All these copies are used by students who will then work as doctors or pharmacists. They will work for hospitals, clinics, pharmacies, health insurance companies as well as pharmaceutical companies – all of these organizations are our potential customers. Getting used to our software, these students might ask their employers to purchase the legal copy of the program.

So it seems we would even pay the university for installing our software on each computer in their computer class Later, I believe, it might be very good idea to give away our software to universities and students for free.

______________________
RSS Subscription for this blog