A Jordanian internet start-up is achieving great success tapping in to the Arab world's demand for Web 2.0-style digital content delivery services. Aaron Greenwood spoke with d1g.com founder and CEO Majied Qasem about the company's ambition to ride the crest of the Arabian online revolution.
Majied Qasem is a man with the Midas touch. One of the leading lights of Jordan's recent IT revolution, Qasem has quickly developed a reputation for playing a key role in turning small internet start-ups and software development firms into some of the regional IT industry's heaviest hitters, attracting interest from the likes of Microsoft in the process.
Qasem also ranks as one of the regional internet industry's most enduring pioneers, having co-founded the massively successful Arabic community portal, Arabia.com, in 1996. Qasem decided to sell his stakehold in the company long before the dot-com crash of 2000 saw its market value spiral - a fortuitous stroke of luck he attributes with much of his later success.
"I was the only shareholder who exited the company when it was at its peak, and the money I made from the deal enabled me to establish Oneworld Solutions, which in turn quickly became one of the largest enterprise software developers in the Middle East," he says proudly.
Qasem played an instrumental role in turning Oneworld into a thriving business, with annual revenues of more than $US13m, offices in five countries and a workforce of more than 200.
In the months following the dot.com crash, Oneworld merged with rival Jordanian IT solutions provider Zeine Technological Applications, to create a new company known as Estarta Solutions.
As a founding partner and director of the company, Qasem again saw his stocks rise, when Microsoft came calling.
"Microsoft decided to invest in Estarta, which was a massive coup for us, as it was the first time the company had acquired an interest in a standalone Middle East-based IT business," he says.
Qasem was named head of development for the company, a high-profile position which led to his recruitment by the Jordanian government to oversee the implementation of the Jordan Education Initiative (JEI), an ambitious e-learning project developed in conjunction with Cisco Systems.
With the internet revolutionising communications and social interaction across the globe, and given his previous experience with Arabia.com, Qasem recognised the commercial opportunities offered by establishing community-based web portals catering specifically to Arab internet users. From this, the seeds of d1g.com were sown.
"The Middle East is in the middle of an online revolution in terms of the proliferation of content and the number of users accessing community-based websites," Qasem declares. "It's mainly because of the deregulation of the telecoms sector throughout the region and the proliferation of new media content providers. We are working hard to position d1g.com as a platform linking both sectors.
Launched in November 2006, the website, pronounced "deewanji", which is taken from the Arabic word 'dewan' meaning community meeting place, provides users with a range of social networking applications, including video and audio uploads, chat forums, and a proprietary Arabic-language search engine.
Qasem unabashedly admits to seeking inspiration from rival social networking platforms in developing the portal's key features, despite creating a customised look and feel to the website he says is specifically designed for local tastes.
"The Middle East online sector has traditionally been behind the curve of established markets such as Europe or the US in terms of technology and user trends," he says. "Basically, this situation has enabled us to analyse what service offerings are commercially successful elsewhere and pursue those we believe offer similar potential in this region.
Despite claims from some sectors of the media that d1g.com is an Arabic version of social networking site Facebook, Qasem says the multimedia-focused MySpace actually provided greater inspiration.
"Facebook was relatively unknown when we launched this business," he says. "If anything, we modelled d1g.com on MySpace. But in saying that, the fact that we are focusing predominantly on the Arab market means we're catering to fundamentally different users than sites like MySpace and Facebook.
Our main ambition was to create a site that bridged closed and open platforms. We wanted to provide a balance between guaranteeing our members' privacy while also ensuring a certain amount of content remained available to unregistered users. From the outset, providing enhanced content services such as video and audio was also a top priority.
Undoubtedly, this latter feature has proven the website's most popular facility with visitors. It also borrows the best aspects of that other Western multimedia web giant, YouTube.
But, as ably demonstrated by YouTube, open video platforms create significant challenges in terms of content regulation - issues which are paramount in a region renowned for its conservative values and strict approach to censorship.
"We're hosting around three million new videos each month, which makes us the number one video upload site in the Middle Ees not contain offensive material.ast," says Qasem.
"We receive more than two million visitors to the site each month and anywhere up to 20 million page views, and a very large percentage of these users are posting their own digital content at some point during the month. One of our most important challenges is to ensure this content do
"We actually employ a team of 20 whose sole task is to monitor this content. We take a very hard line in regards to content of a strongly political or sexual nature that is culturally offensive, which could result in the site being blocked by governments across the region.
Despite this, Qasem says he has been "pleasantly surprised" by the response of regional authorities to the website.
"Initially, I was very concerned about the potential impact strict regulations would have on the growth of the business. But in reality, they've created few barriers to success," he says. "I'm acutely aware however that as the mobile component of the business develops this situation may change.
It's a slight inconvenience that we have had to hire a larger content monitoring team than we first anticipated to ensure our content is 'safe'. But that's a challenge our rivals also face in the region."
Indeed, Qasem says that while the mobile communications space presents significant challenges, he believes it also represents one of the biggest commercial opportunities in terms of the development of the d1g.com brand.
Last month, the website's second generation platform went live, which not only simplified the site's social networking features but more importantly introduced a next-generation mobile component leveraging push technology.
"We've introduced a new service that enables users to receive and respond to SMS sent via the site from other users within their network," he says.
"We're also negotiating with mobile phone operators and handset manufacturers to incorporate software that will enable users to capture video via handheld devices and automatically upload the content to d1g.com.
We are committed to driving the convergence of online and offline services, by creating a sophisticated mobile interface that will enable users to access all of our services from their mobiles as they would from their PCs.
Qasem is also hopeful this new delivery platform will expand d1g.com's advertising revenue base.
"We've traditionally relied, perhaps too heavily, on banner advertising," he concedes. "Today, in the Middle East, the average banner ad sells for around $20 per 1000 page impressions. In the US the same product sells for around $1.
By the end of 2008, we expect local rates to fall significantly. We're looking to introduce new value-added features for our advertisers to sell their message for a premium.
Qasem says these features will include expanded mobile advertising opportunities and video advertising including sponsorship watermarks.
"Middle East online advertising revenue is growing at around 50 percent per annum, which is about twice the rate of growth internationally. Obviously, we are hoping to expand our own revenue base in line with this projection.
Not surprisingly, the bulk of the company's advertising revenue is derived from the wealthy markets of the GCC. Despite this, the latest Alexa traffic data suggests the website's core audience is based largely in the Levant and North African markets.
Qasem questions the validity of the Alexa report, claiming the data is skewed to reflect overall internet user penetration rates across the region.
The Alexis traffic data is quite deceptive," he claims. "Saudi Arabia is one of our biggest markets in terms of traffic. We recently acquired [Riyadh-based mobile content provider] 66g.com in a bid to boost traffic in the kingdom, and we're looking to make further investments in the GCC.
"The way we see it is that when you launch an Arabic portal, your traffic distribution will reflect the topography of internet usage in the Middle East. At the moment, the majority of internet users in the region are based in the countries of North Africa and the Levant.
The GCC is a smaller market by way of comparative population, but on the flipside, it contributes the vast majority of our advertising revenues. We're very keen to expand our presence in the GCC, particularly in countries such as Saudi Arabia and the UAE."
The development of new and innovative content delivery services will play a key role in realising this ambition, Qasem claims. One such innovation the company is currently developing is a Microsoft Media Server plug-in, which will enable d1g.com users to stream video and audio content directly from the website to their TV receivers using the company's Media Center platform.
While Qasem recognises that satellite broadcasters currently dominate the region's digital content delivery landscape, he believes that these types of applications will create a range of commercial opportunities for ambitious new media hosts such as d1g.com.
"We're not at the point where we can challenge the mainstream broadcasters," he says.
"But we believe we're developing a viable alternative content delivery platform that could open the door to new opportunities for both our business and consumers."
1996: Founding partner in Arabia.com, which soon establishes itself as the Arab-speaking world's leading community portal.
1997: Founding partner in OneWorld Solutions, which would go on to employ 200 staff worldwide and generate US$13m in annual revenues.
2000: Becomes a founding member of the Information and Technology Association of Jordan (Intaj).
2002: Becomes a director of Estarta, the company formed following the merger of OneWorld and rival Jordanian IT solutions provider Zeine Technological Applications.
2002: Helps found Injaz, a Jordanian NGO focused on youth development in Jordan. Continues to serve on the board of both Injaz and Intaj.
2005: Is named the acting program director for the Jordan Education Initiative (JEI), a landmark e-learning project.
2007: Establishes d1g.com.