Mobile Entrepreneurs Work at Innovation's Edge in the Middle EastPublished February 05, 2013 in Arabic Knowledge@Wharton
The mobile revolution has swept over the technology sector. Mobile Internet users are expected to far exceed wired users in the near future because of increasing popularity in developed countries. The money, business leaders say, is sure to follow. Watching advertising trends on mobile over the coming years will be one of the most telling signposts of where the industry is headed.
While the United States, China and South Korea have dominated the spotlight for mobile innovation, the industry is far more diverse than those three hotspots. Interesting applications are being introduced from emerging marketplaces that lack the kind of ecosystem to support a full-blown industry, such as the Middle East and North Africa (MENA) region.
"There's still space for innovation in the region; there's so many bright minds and hungry people," says Sarah Karam, partnerships manager at Shopkick Inc., a mobile-shopping company in Palo Alto, Calif.
That's in spite of the difficulties, she notes. She started Mobilab Lebanon based on Siri, the intelligent personal assistant software created for Apple's iOS. But potential local investors repeatedly dismissed the viability of the project.
"It forces you in Egypt and Lebanon to really push yourself, to think outside the box. You can't just wait for things to happen. No one is going to come knocking on your door with US$5 million. You have to be much more proactive. These guys are pretty savvy, probably much more than other areas."
The region will more likely experience Arab versions of Amazon.com because it is safer than pure innovation. "There's nothing new to innovate on for early stage entrepreneurs in developing countries," adds Karam. "They need to build to base before they can innovate on it."
However, Tim Draper, a managing director of venture capital giant Draper Fisher Jurvetson in Menlo Park, Calif., gushed about the potential of the Arab world during a speech at the Global Internet Mobile Conference. "I know nobody's looking there," said, adding his interest has been piqued after witnessing how wireless applications were used to help overthrow governments in Egypt and Ukraine.
"We live this news every day," says Mohamed Kash, CEO and co-founder of Yadget. "It's not affecting what we want to do in our future. For me, the revolution didn't make the entrepreneurs but the entrepreneurs made the revolution."
A year ago Kash, 30, and a partner created Yadget, a Cairo-based social network mobile application that lets users tag objects and locations. The tags are linked to a barcode or to a location on a map for others to find. "This bridged the gap with all the online content and the physical world around you," says Kash.
It currently is available as an app for Android and Chrome plug-in and is offered for free. Yadget hopes to make money through brand subscription for the landing page and payments for key words and product categories. Brands can use Yadget to aggregate their existing social network posts and leave notes about their products or venues.
For the Yadget project Kash and his co-founder looked globally. It might have been a smart move according to Phil Libin, chief executive of Evernote, a collection of note taking and sharing productivity apps. "It's not true you need to make a product specific for a region," he said during a panel discussion at the mobile conference. "You just need a great product."
Kash sounds like almost any promising entrepreneur matriculating out of Silicon Valley when saying he wants to create great products that solve problems. He has re-located to Silicon Valley through the help of Tech Wadi, a Bay Area non-profit dedicated to promoting Arab entrepreneurs.
Kash hopes to remain at the cutting edge of the mobile movement by having firm footing in America's technology hub. But he's doing it to showcase Arab knowhow. "I have to prove we can do it," he says.
Kash is not the only Egyptian with such ambitions. Mai Medhat, 25, also is trying to make her mark in the mobile world as CEO and co-founder of Eventtus. Her team launched the mobile application in October that can be downloaded for iOS or Android systems.
It works similarly to online social networking portals such as MeetUp and EventBrite that facilitate group meetings around the world. The tool is tailored for business conferences but also works for social outings among friends. The site helps users find events that might pique their interest and share them with friends. It also allows users to interact with others attendees without having chance meetings at social mixers.
Medhat expects to grow Eventtus in the Arab region for some time. Although the service faces competitors such as Facebook, Medhat is betting that her team's local knowledge will lead to regional success.
A mobile shift
Bit by bit such enterprises could eventually help broaden MENA's budding high-tech sector. Meanwhile, the high tech industry in Silicon Valley pivots to serve mobile users.
The popular social media giant Facebook is following users to mobile devices to continue being at the heart of their online experience. Mark Zuckerberg's mobile agenda underscores the seismic shift taking place as more and more customers rely on devices such as smartphones and tablets to navigate their lives.
"Facebook used to think of it as an afterthought and now they are seeing mobile is the core," says Rob Trice of Swisscom Ventures. "Now as products are being launched mobile is being built in from day one."
Facebook vice president Vaughan Smith bolstered Tice's observation during a speech at the Global Mobile Internet Conference held in the fall in San Jose, Calif. A year ago the popular platform spent 80% of its product review talking about desktop websites. But in an about face "we pivoted our thinking to how can we create the right mobile experience first, and the desktop can catch up later," Smith said.
Facebook isn't alone in the race to remain relevant in a business where it's easy to become passé overnight. This past December, new Yahoo chief executive Marissa Mayer announced a redesign interface for Yahoo Mail that was tailored to fit mobile gadgets. It was Mayer's first big move since taking the reins of the flagging company in the summer.
"Since the start of this year, if you turned up at a product review and showed anything other than mobile at the start or for the bulk of the presentation, you'd be asked to go back and do it again," Facebook's Smith said.
Facebook executives ultimately spent 2012 changing the mindset inside its campus. "Now most of the mobile code submissions are coming from the teams responsible for news feed, Messenger, Timeline, or whatever product we happen to be rolling out," Smith said. "That's a huge change for us."
The social media company has improved its applications for more efficient use on iOS and Android systems. It also has facilitated e-commerce by making it easy to buy gifts or advertisements from phones.
"When we see people make the switch from using Facebook on desktop to mobile they get 20% more engaged," Smith said. He added that the platform has more than 140 billion friend connections. "The reason that that's important is because we feel like we have laid the foundation for developers and for us and for partners to do really amazing things on mobile that couldn't be done before."
Smith concluded, "Facebook is the number one place that people are spending time online. It's the Super Bowl of mobile."
The Facebook push parallels similar campaigns around the world according to other speakers at the Global Internet Mobile Conference. Lei Jun, the so-called Steve Jobs of China, said virtually every region must have a social network and an established e-commerce to be a successful global player.
"The biggest change in the next 12 months will be the penetration of smartphone usage," said the billionaire chief executive of Xiaomi through a translator. "This year has been the biggest increase in smartphone transition from regular phones, which nobody had predicted."
While users are migrating to mobile devices by the tens of thousands the industry has struggled to find the right formula to make money off the trend. Press reports have highlighted this vacuum whereas industry leaders seem to ignore it in their enthusiasm to embrace mobile.
Experienced technology analysts understand it takes time to allow advertisers to figure out the best way to engage a new frontier. Companies such as Facebook say they must react to the marketplace so that their services have real-time relevancy to worldwide audiences.
"What typically happens is the consumer adopts new technology first, and they go 'This is really something cool, this is something fun,'" Draper said. "It takes a while for the enterprise to come in but they do come in, in a big way."