Growth zone: International agreements and new centres for innovation spur investment in Dubai Internet City


The opening of a new innovation centre and the success of local start-ups highlights the continued centrality of Dubai Internet City (DIC) to the emirate’s ICT and innovation sector. The free zone, which opened in 2000, began its operations by attracting many of the world’s most significant technology multinationals – including IBM, Cisco, Oracle and Microsoft – to establish their regional headquarters in the DIC. Between 2000 and 2018 the DIC attracted a total of Dh7.8bn ($2.1bn) in investment, and this figure has since continued to grow. As of late 2019 the DIC hosted over 1600 companies and more than 24,000 tech professionals. Firms operating in the free zone included such global players as Google, Facebook, LinkedIn and Twitter, together with a broad ecosystem of tech start-ups, small and medium-sized enterprises (SMEs), and freelancers.

Start-Up Environment

The most recent start-up success story to emerge from the DIC came in September 2019, when local artificial intelligence-enabled voice-to-text start-up Wrappup was purchased by US tech giant Cisco. The start-up had developed through the DIC-based IN5 incubator programme and was initially purchased by fellow voice-to-text software company Voicea in 2018. Earlier in 2019 the DIC celebrated its largest start-up acquisition to date; the purchase by US tech giant Uber of Dubai-based ride-hailing platform Careem for $3.1bn in March. According to Uber, the purchase became the largest-ever tech industry transaction to take place in the Middle East. Another major exit took place the same month, with the purchase of online classifieds portal Dubizzle by the South Africa-based investor Naspers, for $190m. Naspers had previously purchased a 51% controlling stake in the company in 2013 for $120m.

The Uber deal was the largest since 2017, when Amazon purchased Dubai-based e-commerce platform for $580m. This was preceded by the sale of the advertisement tech start-up to Chinese conglomerate Miteno Communication Technology for $900m; and earlier by the acquisition in 2009 by US search engine giant Yahoo of – then one of the Arab world’s largest online portals – for $85m.

Innovation Centres

The DIC hosts 10 sites for nurturing new technology ideas and products, including facilities operated by Mastercard, Microsoft and 3M. The most recent of these is the Cisco Innovation and Experience Centre, which opened in November 2017. Work is under way on the Innovation Hub, a 488,000-sq-metre commercial complex valued at Dh4.5bn ($1.2bn), which was earmarked for completion by the end of 2019. The first phase of the Innovation Hub was launched in October 2018, with US multinational Hewlett Packard becoming the first company to begin operations in the facility. Phil Davis, president of Hybrid IT and chief sales officer at Hewlett Packard, told local media that the decision to commit to the new project was motivated by the UAE’s “unique perspective on public-private partnerships and their efficacy in mining the power of artificial intelligence”.

The project is being developed by the TECOM Group, a unit of the Dubai Holding sovereign investment vehicle. The completed Innovation Hub will consist of 11 low-rise office buildings and is expected to add at least 15,000 further qualified industry professionals to the DIC. While the focus of the project will be to foster an innovation ecosystem to explore new ideas in technology, media, education and sciences, it will also contain retail offerings and hospitality developments.

As part of a broader effort to attract increased foreign investment, the DIC has recently signed a number of agreements with emerging innovation markets. In October 2018 the free zone signed a memorandum of understanding (MoU) with the Russian Export Centre to launch the new Russian Centre of Digital Innovation and ICT. The same month the DIC signed an MoU with the Indian ICT industry body, National Association of Software and Services Companies, to encourage Indian SMEs to establish business operations in the emirate.