Dubai Internet City
Dubai Internet City is an information technology park created by the government of Dubai as a free economic zone and a strategic base for companies targeting regional emerging markets. The economic rules of DIC allow companies to avail themselves of a number of ownership, taxation and customs related benefits which are guaranteed by law for a period of 50 years. One model of operation includes 100% foreign ownership, similar to those prevailing in other designated economic zones in the United Arab Emirates. These freedoms have led many global information technology firms, such as Facebook, LinkedIn, Google, Dell, Intel, Huawei, Samsung, SAP, Microsoft, IBM, Oracle Corporation, Tata Consultancy, 3M, Sun Microsystems, Cisco, HP, Nokia, Cognizant and Accenture, as well as UAE based companies such as Ducont, to move their regional base to the DIC. DIC is located adjacent to other industrial clusters such as Dubai Media City and Dubai Knowledge Village.
DIC presently has over one and half million square feet of prime commercial office space, in which over 1400 companies with over 10,000 workers are based. There are 25 low, mid, and high-rise office structures in the area.
Connectivity
On 13 April 2008, du announced that all of its traffic would be routed via the UAE's membership proxy which blocks access to any content deemed 'inappropriate'. du had been previously blocking VOIP services.While Dubai Internet City sells itself as a business-friendly environment with excellent low cost connectivity, the reality is one of a heavily censored internet with prices that are 5-10 times the price of connectivity in Europe or the USA. In addition to webpage censorship, it is speculated that a variety of popular social networking services are blocked. Cheap calls to the UAE are not possible due to a termination charge of around 17p UK, per minute imposed by the UAE phone networks. Internet connectivity in Dubai is expensive; a 10 Mbit/s home connection costs 299 AED per month. The minimum internet connectivity package available for businesses at DIC is a 2Mbit/s connection with a 6GB monthly limit for around 800 AED. Bandwidth beyond the 6GB limit is charged at a higher pro-rata rate than the first 6GB.
The UAE proxy can be bypassed by various methods including by setting up a VPN to connect securely to a server in another country to reduce the amount of Internet censorship, with the advantage that UAE authorities cannot 'snoop' on the traffic. While the UAE may block access to the web sites companies providing VPN services, it is possible to arrange overseas accounts. Such options significantly reduce costs as VOIP systems can be used; for companies who require access to services or content that is blocked, VPNs are a necessity.
Around 11.15 AM on January 30, 2008, a ship's anchor apparently severed fibre optic cables between Palermo, Italy, and Alexandria, Egypt. Providers across the Middle East and as far as Pakistan were heavily affected with a significant slowdown of communications reported. The UAE telecommunications company and Dubai Internet City's internet service provider du was one of the worst hit, becoming completely inoperational for several hours. Since du has a monopoly in the Free Zones, customers had no alternative connectivity during the outage.
History
Dubai Internet City, a member of Dubai Holding subsidiary TECOM Investments, was founded in October 1999, and it opened its doors in October 2000.Dubai Internet City provides a knowledge economy ecosystem designed to facilitate the business development of Internet and Communications Technology companies. It is the Middle East's biggest ICT infrastructure, built inside a free trade zone.
The global ICT giants like Microsoft, Oracle Corporation, HP, IBM, Dell, Siemens, Canon, Logica, Sony Ericsson, Schlumberger and Cisco, as well as many small and medium enterprises and entrepreneurial ventures are based in DIC. The ICT cluster in Dubai Internet City comprises companies from sectors like software development, business services, e-commerce, consultancy and sales and marketing. Locally bred technology companies like Ducont FZ LLC, one of the earliest startups at DIC, have shown that innovation is possible in the region, and quite successfully so, at that.
The cluster environment of DIC provides most elements of the value chain for an ICT business. In addition, it has developed programmes that can be leveraged by the ICT community to explore and expand channel and business development opportunities.
Economics
Dubai Internet City, like the whole of Dubai, has seen rapid growth, with the Emirate's GDP rising at double digit rates. However, since 2003 inflation has climbed rapidly too, making real GDP growth significantly lower. The latest official government figures state inflation of 9.6%. By spring 2008, the level is somewhere over 10%, and approaching 20% according to the estimates of some international banks.The government has implemented price controls on rent rises as well as fuel and basic commodities such as rice, but these cannot be viewed as effective long term anti-inflation measures in a market economy. The UAE has continued to reiterate the commitment to pegging its currency to a continually weakening dollar, which rules out significant interest rate rises - the accepted inflation-fighting tool in developed countries. Federal Reserve interest rate cuts of 1.25% in January 2008 have been mirrored by the UAE Central Bank, which is certain to fuel inflation further and weaken the currency.
In March 2008, DIC announced a rental increase to 180 AED per square foot - a 25% rise. The DIC statement accompanying the release said "operating costs have shot up recently due to economic growth in the region". It made no mention of the decision by the UAE government in November 2007 to hike federal government employees' salaries by 70%.. In late 2008, Dubai property prices began to crash heavily, falling by up to 50% over the next six months. Rents across the emirate fell heavily and many jobs were lost, particularly in real estate. Despite this, as of December 2009 DIC rents were not reduced. The present rent of 160 AED, including the service charge for electricity, is roughly double the rents available in the areas immediately outside DIC. From January 15, 2013 the RTA began charging workers and visitors to DIC, as well as Dubai Media City and Knowledge Village for parking, which had previously been provided free. In addition to charging fees for parking in car parks and designated parking areas, the authorities began activating parking meters on the streets, and in off-street areas. The move caused widespread concern among workers in DIC and the other TECOM areas.