By Mohamed Alaa Eldin
ITWORX Education, which has been reviewing its plans to penetrate the Egyptian market, has already achieved success on global markets. An Egyptian company set up in 2003, it specialises in offering technological education solutions. With just over a decade of experience in its field, it was chosen by Microsoft as the best global partner in the field of education.
ITWORX has delivered its services in many global markets, including Canada, the US, Norway and the UK, in addition to a number of regional markets in Qatar, the UAE and Saudi Arabia. There are ongoing negotiations with the Egyptian Ministry of Education to activate a project utilising technological tools in public schools, according to the company’s CEO, Hatem Sallam in an interview with Daily News Egypt.
How do you view information technology infrastructure on the Egyptian market?
The Egyptian market was advanced in terms of information technology infrastructure rankings until 2009, but developing this infrastructure has stopped since then, creating a digital gap in comparison with other Middle Eastern states. This gap stretches across internet services, electronics, mobile phones manufacturing, and even shipping services. The proof is Egypt’s global rank in software exports, being the 10th in 2004 and 2009, then moving all the way down to 70 this year.
What created this gap?
Large government projects and private sector companies have stopped injecting investments into the sector due to the circumstance the country was experiencing. Even mobile companies didn’t invest in their networks as usual, and university graduates equipped to work in the technology sector do not exceed 20,000 students per year, which is a small number compared to 1 million such graduates in China annually.
Are there industries in the IT sector that Egyptians are characterised by?
Egyptians are characterised by four basic industries in IT. At the forefront of this is design, and there are more than 40 Egyptian companies in this sector that specialise in designing computer processors, tablets and smart phones. The second type of industry is the Egyptians’ ability to create products able to compete with global ones. This is the field in which ITWORX Education operates.
The third type of IT industry is planning and technological consulting. Egypt has competitive characteristics in this sector compared to India and Italy, who are the best in this sector.
The last type of industry is the call centre. This industry is labour-intensive and earns low revenues. Egypt stands out in this industry because of a better English accent compared to Eastern Europe and India, and also because of cheaper prices.
What are the most important challenges facing Egyptians in competing globally in the field of IT?
IT infrastructure development is one of the main challenges faced by Egyptians, as well providing trained manpower, especially since the majority of high-school students flee from science and turn to humanities, which reduces the scope of manpower for the IT field.
How can these challenges be overcome?
The government has much to do in order to help the sector overcome these challenges. It must offer mega-projects to develop infrastructure in partnership with the private sector, and the government also needs to move in the direction of supporting manufacturers through marketing subsidies in friendly states to open markets for them.
Currently there are talks underway for a global IT company to acquire our company, and we recently won the award for best partner for the Microsoft Corporation in the field of educational technology.
Why are distinguished Egyptian companies bought out?
There are two trends in the work plans of the IT sector. The first is manufacturing a product and market penetration to build a distinct brand, and Egyptians stand out here. The second trend is growth and this requires a substantial amount of investment being supplied for research and development in order to achieve growth, which is beyond the ability of Egyptian companies. For example, Microsoft is spending $6bn annually on research and development and Google spends $4.5bn; therefore Egyptian companies end being acquired by global companies.
What is the reason behind your focus on the Egyptian market during the current phase?
ITWORX Education currently has 1 million customers worldwide, but the Egyptian market is large and promising and has more than 18 million students who require educational technology. Once they use our products, we will have 18 million customers in Egypt alone, which contributes to a major expansion in the MENA region. Therefore we offer our products for a fee 10 times less than that of the prices we offer in other markets.
What are the markets in which that you offer your educational technology solutions?
We offer our solutions in many markets around the world, most notably in four provinces in Norway, and two provinces in the UK, including a school that received the best school development award. We also have a number of customers in Canada and the US, in addition to the fact that all public schools in Qatar use the technology that we offer with 125,000 student beneficiaries. Other public schools in the UAE, in which our technology is used, have received the award for best application of technology worldwide. We also offer our services to 10 international schools in Egypt with the help of Telecom Egypt, which is our main partner in the country. We have a presence in the Saudi, Jordanian, and Lebanese markets as well.
What are your plans for foreign expansion?
We are currently engaged in final negotiations to apply our education technology system in Nigeria as well as Algeria, and we are planning to enter the Brazilian and Indonesian markets.
What are the main plans for developing your products?
In the next phase we are focusing on research and development. We are spending more than 25% of our revenues on scientific research, and are working on raising awareness among governments of the role of technology in education. This will help opening up new markets, and we are also looking to develop our products using educational games to make a change in the educational process.
What are the available investment opportunities in education technology in Africa?
There are many African countries that have investment opportunities in the field of education technology, led by Sierra Leone, Gabon, Madagascar, Ethiopia, Kenya, Niger, and Sudan. And these countries began allocating large budgets to develop education, following in the footsteps of neighbours like South Africa and Botswana, which ranked among the best 20 countries in terms of education systems.