Qatar is prioritising the development of its ICT sector as it aims to transform into a knowledge-based economy in line with Qatar National Vision 2030, the country’s framework for economic diversification and growth. Human resource development is critical to the authorities’ goal of becoming a regional leader in ICT, and local talent stands to benefit from partnerships between educational institutions and global tech firms aimed at bolstering innovation.
Growth in ICT will be driven by the country’s extensive pipeline of large-scale, government-led infrastructure projects in transport and energy, as well as by innovation in the financial services, retail and health sectors. Chief among these developments is the Lusail City project, which is central to preparations for hosting the 2022 FIFA World Cup. The smart city is being built with technologies such as the internet of things (IoT), 5G and artificial intelligence (AI), among others, to encourage sustainability and promote mobility. Beyond hosting this major sporting event, Qatar is looking to leverage opportunities in other high-potential areas such as e-sports, as well as boost the local research and development (R&D) ecosystem.
Structure & Oversight
The ICT sector is overseen by the Ministry of Communications and IT, which was established in October 2021 after a cabinet reshuffle divided the functions of the Ministry of Transport and Communications (MoTC). Under the former ministry there are several subdepartments relevant to the development of ICT in Qatar more broadly and within the government specifically, including the Digital Society Department – which aims to provide the wider community with the tools necessary to achieve higher levels of digital inclusion – and the E-government Portal Department.
As regulator, the Communications Regulatory Authority (CRA) – which was established in 2014 – licenses telecoms companies. In addition, it manages postal services, digital media access, spectrum allocation and activities that ensure customer protection, among other responsibilities. As part of its strategy for 2020-24, the CRA developed the Cloud Policy Statement, in which it laid out policies and regulations aimed at creating a robust cloud-computing industry in Qatar. The authority began a period of public consultation on the draft policy at the end of March 2020.
Another government body relevant to the sector is the Qatar Financial Centre (QFC), which signed a memorandum of understanding (MoU) with the MoTC in January 2019 for cooperation in all activities related to the digital development of Qatar. The QFC plays a key role in attracting entrepreneurs and foreign investment from global technology firms. For example, in November 2019 it signed an MoU with Microsoft to bolster strategic cooperation and knowledge sharing. More recently, in November 2021 the QFC signed a partnership with local telecoms provider Ooredoo to share expertise and capabilities to boost development in areas such as digital innovation, smart cities, financial technology, cybersecurity and cloud solutions.
Performance
Aided by the pivot to remote work, commerce, education and entertainment during the Covid-19 pandemic, ICT has been one of the few sectors to experience steady growth while most other industries faced pandemic-related headwinds. According to the Planning and Statistics Authority (PSA), the information and communications sector grew by 1.9% at constant prices in 2020 to QR10.4bn ($2.9bn), outpacing growth of 0.1% in 2019. Its share of total GDP also increased, from 1.4% in 2019 to 1.6% in 2020. In the second quarter of 2021 the sector accounted for 1.5% of GDP, or QR2.58bn ($708.1m). While this was down from QR2.59bn ($710.9m) the previous quarter, it represented a 5.2% rise year-on-year (y-o-y). The telecoms sector’s net value added stood at QR5.4bn ($1.5bn) in 2019, according to the most recent PSA data available.
The ICT sector was valued at $4.4bn in 2021 and is anticipated to grow on the back of significant investment. According to UK-based data analytics consultancy Global Data, ICT spending in Qatar will expand by a compound annual growth rate (CAGR) of 9.2% between 2019 and 2024 to reach $9bn. Over this period, IoT, cloud computing, cybersecurity, big data analytics and AI are expected to drive growth and comprise roughly 50% of the market. Cloud computing, for example, is forecast to grow by a CAGR of 17.8% over the period to $1.6bn, driven by the software-as-a-service segment as Qatari companies shift from on-site software to cloud-based models.
Qatar has one of the highest internet penetration rates in the world, which reached around 99% as of January 2021, according to a report published by social media monitoring firms Hootsuite and We Are Social. The country’s average mobile download speed stood at 178 Mbps in May 2021, placing Qatar significantly above the world average of 54.53 Mbps.
Rankings
In the Government Electronic and Mobile Services Maturity Index 2020 released by the UN Economic and Social Commission for Western Asia, Qatar ranked second among 15 Arab countries. Meanwhile, it ranked first worldwide in the Digital Accessibility Rights Evaluation Index 2020, published by the Global Initiative for Inclusive Information and Communication Technologies. More recently, in 2021 Qatar ranked 68th out of 132 countries in the Global Innovation Index released by the World Intellectual Property Association, with the highest rankings for infrastructure (34th) and institutions (56th).
Pandemic Response
Thanks to its strong technological capabilities, Qatar was able to identify at-risk segments of the population during the early stages of the pandemic, which has helped to keep its case-fatality rate among the lowest in the world. As of February 3, 2022 Qatar’s case-fatality death rate stood at 0.19%, significantly below the global case-fatality rate of 1.46%. National efforts were aided by the government’s launch of the Ehteraz contact-tracing app in June 2020, which uses a comination of GPS and bluetooth technologies.
ICT capabilities were vital to navigating challenges brought on by the health crisis. To this end, Qatar Science and Technology Park (QSTP) launched the Call for Tech campaign in April 2020, targeting local and international tech start-ups and entrepreneurs to submit solutions to pandemic-related challenges in the areas of e-health, education and supply chains.
Meanwhile, digital government services expanded rapidly in response to the pandemic in order to provide health care assistance and enable business continuity during periods of movement restrictions. In June 2021 Qatar ranked fourth in the world for the provision and adoption of digital services in a study titled “Digital Government in the GCC: Accelerating Citizen Trust” by US-headquartered Boston Consulting Group. The study found that Qataris’ level of satisfaction with digital government services was 58%, with 43% of respondents reporting they used e-government services at least once a week.
The pandemic accelerated the adoption of digital solutions in markets around the globe, including in Qatar. A survey of CEOs based in the GCC conducted by OBG in July 2020 found that Qatar-based executives were the most likely in the region to have implemented remote-working practices, and more than 75% of respondents in the country believed that the pandemic would permanently change the way that they that interact with clients. These findings suggest that there is strong potential for tools that can support the digital transformation and boost businesses’ long-term competitiveness. “In the post-pandemic world we will see a re-evaluation of how business is done,” Cengiz Oztelcan, CEO of Gulf Bridge International, a global connectivity, content and cloud provider, told OBG. “Firms have seen what can be done remotely, and although the need for face-to-face interactions and on-site activities will continue, many other activities will remain online.”
Initiatives
The government has implemented several initiatives that are at the digital core of Qatar National Vision 2030. One such programme is Hukoomi, an e-government portal launched by the government in 2008 to make public services more accessible to citizens, facilitate business activity and boost transparency. In November 2021 total transactions via the platform rose by 9% monthon-month and 7.5% y-o-y, according to the PSA.
The Qatar Digital Government Training Programme (QDGTP) was created to support the digital transformation of government entities by providing training to improve the capacity of ICT professionals in the public sector. According to the QDGTP annual report, over 3000 employees have received training under the programme. In August 2021 the QDGTP released its training plan for the second half of the year, which featured 96 courses on 55 technical subjects. The number of applications for the period reached 1835, up from 1056 in the first half of 2021.
The QDGTP was launched to support the implementation of the Qatar Digital Government 2020 Strategy, an MoTC initiative that began in 2014 and aimed to upskill all government ICT employees. Mashael Al Hammadi, then the acting assistant undersecretary for IT at the MoTC, told local media in March 2021 that the strategy achieved 100% of its targeted common application and infrastructure projects, and implemented over 90% of targeted critical service projects. As of late 2021 the country was preparing to launch the next iteration, the Qatar Digital Government Strategy 2021-26. The blueprint will focus on leveraging technologies such as AI, machine learning, big data analytics, blockchain and cloud computing to enhance public services.
Another digital initiative is the Smart Qatar Programme, more commonly known as TASMU. It supports the implementation of technologies across five key sectors: environment, sport, health care, logistics and transport. Under the auspices of the programme, the government will invest $1.65bn between 2017 and 2022. TASMU aims to transform Qatar into a smart country underpinned by advanced digital solutions that will boost Qataris’ standard of living and the country’s international competitiveness. According to a 2018 study by ESI ThoughtLab, adopting smart city technologies can increase GDP per capita by up to 21%. To leverage this potential, Qatar is building Lusail City, a $45bn smart city located just north of Doha. The project is being developed by Qatari Diar, the real estate arm of the Qatar Investment Authority, in partnership with Ooredoo. The operator is outfitting the city with a 5G fixed and wireless backbone, and installing sensors and other devices connected via IoT. Lusail City was nearing completion as of late 2021.
TASMU Digital Valley was established by the MoTC and the Qatar Free Zones Authority in 2019 as an innovation cluster, enabling entrepreneurs, startups, investors and academics, among others, to connect and support the vision of Smart Qatar. It has identified 15 priority technologies that are forecast for growth, with a combined market value expected to exceed $1.7bn in 2022, up from $901m in 2019. Of these segments, the largest in terms of market value in 2022 are projected to be IoT ($573m), cybersecurity ($314m) and systems integration ($170m).
In July 2021 the MoTC launched TASMU Platform to leverage innovation and advanced technology to generate smart solutions. It supports TASMU Digital Valley in positioning Qatar as one of the world’s most advanced smart countries.
Telecoms
The telecoms market is dominated by Ooredoo, which has become a major telecoms conglomerate since its inception as a domestically focused fixed-line services company in 1987. It was then known as Qatar Public Telecommunications, before becoming a Qatari shareholding company under the name Qatar Telecom, or Qtel, in 1998. It was later rebranded as Ooredoo in 2013.
Qatari government entities had a 68% share in the company and the Abu Dhabi Investment Authority held 10%, with the remaining 22% publicly owned as of early 2022. Ooredoo Group had a total of 120.6m users worldwide in 2020, up from 117.2m and 115.2m in 2019 and 2018, respectively. The company’s revenue remained stable at QR29.9bn ($8.2bn) in 2018 and 2019, and dropped to QR28.9bn ($7.9bn) in 2020. Its Qatar operations accounted for about a quarter of this figure, or QR7.1bn ($1.9bn), down 3% from QR7.3bn ($2bn) the previous year.
In 2021, however, Ooredoo Group’s revenue grew by 4% to QR29.9bn ($5.1bn), while its customer base expanded by 1% to more than 121m. The company’s revenue in Qatar grew by 6%, reaching QR7.5bn ($1.3bn), driven by post-paid services, business-to-business services, Ooredoo TV sales, mobile financial services and increased sales of devices. The total number of customers in the country stood at 3.2m, which exceeds the total population of 2.7m.
The second major player is Vodafone. It launched its services in the country in 2009, introduced fibrebased products in 2012 and began rolling out Qatar’s first 5G services in August 2018. As of February 2022 the government had a 62.27% stake in the company via various organisations and funds. In 2020 Vodafone Qatar generated QR2.2bn ($603.8m) in revenue, up 3.5%, driven mainly by fixed broadband and post-paid services, while earnings before interest, taxes, and amortisation (EBITA) measured QR808m ($221.8m). Its customer base stood at 1.7m and it claimed a 23.7% share of the market’s total revenue.
It continued to grow in 2021, with revenue reaching QR2.5bn ($686.2m) – an increase of nearly 15% –and a customer base of 1.9m mobile users, up 16.3% from the previous year. EBITA rose to QR1bn ($272.5m), reflecting higher service revenue and the company’s cost-optimisation programme.
5G
The development of Qatar’s ICT ecosystem has been facilitated by cooperation between local and international players to increase capacity. In May 2018 Ooredoo Qatar became the first operator in the world to deploy a live and commercially viable 5G network, with plans to launch 1200 5G sites across the country. By March 2020 more than 100,000 customers had signed up for the company’s 5G services, and as of September that year more than 90% of populated areas in Qatar were covered by a 5G base station. In November 2021 Ooredoo Qatar announced that it would be teaming up with Swedish multinational Ericsson to optimise 5G connectivity in eight football stadia across six cities and improve streaming experiences for end-users in the lead-up to the 2022 FIFA World Cup.
Huawei is also supporting the development of 5G services in Qatar. In April 2019 the Chinese firm signed a strategic agreement with Vodafone Qatar to expand and enhance the latter’s wireless network infrastructure, including a large-scale 5G rollout. In late 2021 Ooredoo Group and Huawei signed a five-year global frame agreement that will see the Chinese firm supply its radio, core, and transport products and solutions to the group. This is the latest milestone in the long-term partnership between the two entities. In late 2015 Ooredoo Qatar extended a strategic cooperation agreement with Huawei by five years, following their previous collaboration to deploy Ooredoo’s national fibre-to-the-home broadband network in Qatar.
“It is important for ICT companies to put their weight behind Qatar National Vision 2030 so that we can build on the momentum of global events taking place in the country in 2022. Economies will soon be driven by AI, neural networks and the IoT, all of which can only be enabled by robust ICT infrastructure,” Ali Al Kuwari, president and CEO of Qatar-based satellite company Es’hailSat, told OBG.
Cloud & AI
To support its digital transformation, Qatar is developing its data centre infrastructure in partnership with global tech giants. In 2019 Microsoft announced that it was expanding a cloud region in Qatar, making the facility the 55th Azure region in the world. The data centre is expected to be inaugurated in the first quarter of 2022 and is anticipated to play a key role in bridging the digital skills gap in Qatar. Elsewhere, in November 2021 Meeza, an ICT firm in Qatar, launched the M-VALUT 4 data centre hosting the new Microsoft cloud region in Doha’s QSTP. Microsoft’s partner, Predica, entered the Qatari market in anticipation of growing demand for IT services. Market research firm Alphabeta estimated that 10 countries in MENA – including Qatar – could generate as much as $600bn in recurring value by 2030 through accelerated cloud adoption.
AI is another area poised for growth. In 2018 the AI market in Qatar was valued at an estimated $1.5m and is expected to grow by 40% annually to $5.7m in 2022. “Qatar has strengthened its innovative ecosystem to further progress towards a knowledge-based economy, with new schools and universities catering to future workforce needs such as IT and science. Such initiatives will drive digital growth and transformation, including in AI,” Saleh bin Mohammad Al Nabit, president of the PSA, told OBG.
In October 2019 the MoTC announced Qatar’s National AI Strategy, which was developed by the Qatar Computing Research Institute at Hamad Bin Khalifa University (HBKU) and aims to give decision-makers and the public a deeper understanding of AI and its importance in shaping the 21st century.
The strategy identified several niche areas where Qatar can be an AI player at the global level. First, in precision medicine, Qatar can develop specialised AI tools to detect, anticipate and manage hereditary diseases based on data from its Qatar Genome Project. Second, in communications, Qatar-based international news media, academia and research institutes could collaborate on the development of novel AI technology to digitalise the Arabic language. Third, in energy, as the world’s largest exporter of liquefied natural gas, Qatar could gather data from its fields to create specialised AI products for the global industry. Lastly, in sports, Qatar’s use of AI and significant investment in sporting infrastructure can be duplicated in international markets.
“Consumers are increasingly demanding high-quality, consistent connectivity. This – combined with deeper digitalisation across industries, the migration to the cloud and the expanded use of AI – will shape the future of the sector over the next five to 10 years,” Oztelcan told OBG.
Talent & Research
In addition to providing the technology to build Qatar’s digital infrastructure, Huawei is supporting the upskilling of professionals and students in ICT. In March 2021 Huawei announced plans to train 10,000 ICT professionals in Qatar over the next three years. The multinational tech company has partnered with Qatar University, HBKU and Community College of Qatar to train students in 5G technology, AI and cloud computing. In September of that year the company signed a MoU with Lusail University to establish a Huawei ICT Academy at the university to help develop Qatar’s ICT talent pool. That month Huawei concluded the fifth edition of its Seeds for the Future programme, run in collaboration with the CRA. 34 students from Qatar University, HBKU and Community College of Qatar completed the eight-day programme.
Such collaboration between universities and private companies is welcomed by the government. Players in both the private and public sector are looking to develop and empower ICT talent to strengthen the overall ecosystem, and education is critical to meeting these goals. Tailored programmes and training is central to efforts to attract young people and nurture an innovation mindset that embraces creativity. Indeed, it is important for an innovation mindset to be instilled at a young age, according to Yosouf Abdulrahman Saleh Al Salehi, executive director of the QSTP. “This will help to support Qatar’s rapidly growing start-up ecosystem and bring new technology to market that is specifically tailored to local conditions in strategic sectors such as energy and sustainable development,” he said.
A stronger talent pool in ICT will also contribute to a more robust R&D environment. According to the World Bank, Qatar spent the equivalent of 0.5% of GDP on R&D in 2018, compared to the OECD average of 2.6%. As part of efforts to develop a national strategy to optimise R&D and innovation activities and facilitate the country’s development, the Qatar Research Development and Innovation (QRDI) Council was inaugurated in 2018. This was followed at the end of 2019 by the creation of the QRDI Strategy 2030. The establishment of these information systems is one of the seven criteria outlined in the 10-year strategy as crucial for the transformation of the country’s R&D ecosystem.
To this end, in November 2021 the QRDI Council launched the QRDI Portal to support collaboration by making it easier for researchers, innovators, government officials and private businesses to connect. The establishment of the portal also met the goal outlined in the Qatar Second National Development Strategy 2018-22 to create a “shared research database and develop coordination mechanisms to optimise synergies and the use of resources across Qatar’s research entities”. In October 2021 the QRDI Council approved a 2022 business plan to implement the first phase of the QRDI Strategy 2030.
Sport & Gaming
Qatar has been working to establish itself as a destination for unique fan experiences driven by technology. There are growth opportunities in digital fan engagement, especially due to upcoming sporting events such as the 2022 FIFA World Cup and the 2030 Asian Games.
In September 2021 Ooredoo Group announced the title sponsorship of Qatar’s first-ever Formula 1 race, officially called the Formula 1 Ooredoo Qatar Grand Prix. The event, which took place from November 19 to 21, 2021, offered attendees an augmented-reality game featuring a virtual Formula 1 track. The event marked the first of 11 races to be held as part of a deal between Formula 1 and the Qatar Motor and Motorcycle Federation; the remaining 10 races will take place between 2023 and 2032. It followed the Amir Cup Final, held at Al Thumama Stadium in Doha in October 2021. The stadium was fitted with 5G that enabled a data traffic volume of 6.4 TB and more than 192,000 voice calls. Calls and data connections returned a success rate in excess of 99.9%. Qatar’s hosting of major motor races is expected to help cement the country’s position on the global map for international sporting events.
The country also has potential to become a regional centre for e-sports. In July 2021 Ooredoo Group announced a partnership with Quest, Qatar’s first and largest e-sports company, to launch its own e-sports brand, Ooredoo Nation – Gamers’ Land. The telecoms operator will release a series of products, services and initiatives geared towards the gaming community. According to a report by Allied Market Research published in early 2022, the global industry is expected to expand by a CAGR of 17.5% between 2021 and 2030 to generate $4.8bn.
Outlook
Qatar has made strides in digital transformation, after efforts to develop its ICT sector and strengthen human resource capacity. As the infrastructure work related to the 2022 FIFA World Cup comes to a close, the country is looking to build on this momentum and attract talent in other high-potential areas. “Much of the work in the ICT sector in recent years has been related to the 2022 FIFA World Cup,” Yousef Al Naama, CEO of Qatari ICT service provider Malomatia, told OBG. “We expect the market to expand by 12-14% a year through 2027, propelled by cybersecurity, cloud computing and AI.”
The government has recognised that educational institutions and their collaboration with global telecoms players are vital components of the transition towards a knowledge-based economy. By leveraging 5G while developing segments such as online video gaming and e-sports in an increasingly digitalised global economy, Qatar is solidifying its position as a leading ICT market in the region and beyond.
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