Egypt establishing itself as a Sports Data Hub

Egypt – a Sports mad nation

What do you get if you couple a sports mad nation with an exceptionally talented and tech savvy young workforce?

One outcome is that you can provide a central hub for producing, analysing and distributing detailed sports data globally.

With substantial growth in the technology outsourcing market over the last 5 years, Egypt is forecast to be a hot ticket in 2024 as more and more companies look to the rapidly emerging location as an ideal tech hub location.

In the last year several larger enterprises have made the decision to guild global IT hubs in Egypt. Those include companies with an established presence such as Vodafone with over 10,000 technologists supporting operations worldwide as well as newer entrants including PwC, Cap Gemini and Atos. Those newer entrants are rapidly expanding their development teams and will all have global hubs with many thousands of developers and data specialists at the end of 2024.

Internationally, sports may be seen as one of the great cultural common denominators, bringing people together through a shared love of ?their favourite teams, sporting heroes and activities. Whether it is football, darts or horse racing, people all over the world come together through a bond based on the love of the game, competition and personalities. It may be argued that Mo Salah has done more than anyone else to establish Egypt’s sporting credentials! However, in the area of sports it is not just exceptional players who has established Egypt as a force to be reckoned with. In fact many readers will likely have utilising detailed sports data created in Egypt via a large number of Egyptian IT data scientists or technicians.

The proliferation of data in the public sphere has allowed fans to easily access football and other statistics with the click of a button. Whether that’s on social media or somewhere else on the internet, advanced metrics are now accessible to a wider audience and have democratised analysis to some extent.

But the average fan takes what they get from public sources. The next strata of data require paid access to bespoke packages from the handful of data companies out there, with club-specific data (and what those clubs do with it, more importantly) the most secretive bit of all.

Companies such as StatsBomb, Opta and Deltatre have been at the forefront of providing data to media organisations, player agencies, gaming companies and clubs in the past decade.

A great example related to Egypt is StatsBomb, who have their key operations in Cairo and this provides the fast growing data company with a central hub that has developed a way to collect and analyse football matches in great detail.

The main benefit of having operations based in Egypt is access to a tremendous talent pool of sports mad fans who have the required technical and data skills – as well as a keen interest in the sport in question. Another benefit of this location is the time zone. By having the data collection hub in Egypt, StatsBomb has a central base where Europe, Asia and Africa are within reasonable time zones and one central hub is something they pushed for in the early days to maintain quality control.

“There’s a famous trade-off between having multiple data collection centres around the world, where people know the local players, and having one central hub. The problem in the first is that the quality control measures between the hubs are inconsistent,” says Hesham Abozekry, co-founder and head of data operations at StatsBomb. “That’s why we pushed for centrality to maintain the quality of the data.”

In terms of the technologies required, there is a meticulous process that involves a human and a computer working in tandem to collect the raw data that powers everything. Computer vision is often used to help the data collector tag events such as shots, passes and tackles, and insert their locations on the pitch.

“The error threshold rate of artificial intelligence is improving, but when you combine it with a human you can reach 99 per cent accuracy,” says Ali Elfakharany, co-founder and head of data product at StatsBomb.?That’s why computer vision is used in live and post-match data collection processes in addition to the input of the data collector.

Egypt – IT Outsourcing Growth

Egypt has been a player in the international IT Development Outsourcing market for some time, with a limited number of companies having a long established presence. One of those is Vodafone Intelligent Solutions, which has a long established Hub in Egypt and provides service to 28 countries across the Vodafone umbrella. So successful has the Vodafone IT Hub been that they currently have approximately 8,500 employees across Cairo and Alexandia, and have committed to grow to 10,000 technologists by 2025.

More recently, in May this year PwC announced that it was inaugurating its global ‘Egypt Technology and Innovation Centre – ETIC). This Centre’s technology experts will be working closely with its consulting teams across the PwC Middle East, UK, Germany and the Netherlands to create industry-focused technology solutions with a focus on enterprise applications, data and analytics, and cybersecurity and custom developments. At the announcement press conference Dave Padwick, PwC UK Partner, EMEA Consulting COO and ETIC Board member, commented :?“PwC is thrilled to be in Egypt to celebrate the establishment of the Egypt Technology and Innovation Centre. Egypt’s welcoming business environment and robust talent base have made it the ideal home for our newest addition to our technology and innovation capability. Our investment in ETIC is strategic and long term, both for our clients and future workforce. Bringing together highly skilled technology talent in Egypt and PwC’s industry expertise enables us to serve our clients in key areas such as SAP, Salesforce, Microsoft, Cloud, Data Analytics and Cyber Security, in the Egyptian market as well as the Middle East and Europe markets. Through combining the best of business innovation and technology, ETIC strengthens our existing offering and is a positive addition to Egypt’s accelerating digital economy.”

PwC follows Capgemini who announced the setup of a Global Delivery Center in Egypt last year, focused on meeting growing client demand for areas such as cloud infrastructure, intelligent operations, engineering, research and development, data science, and artificial intelligence, among others. In March 2023, based on the initial success of the venture, Capgemini doubled down and announced its plans to grow the centre to 3000 employees by 2025. Asked why French-origin Capgemini is betting big on Egypt, Egyptian CEO Seif El-Din pointed to a number of drivers, including the country’s strategic location and time convergence with Europe and the Middle East, the human capital base (who are notably proficient in Arabic and English), the robust ICT infrastructure, and Egypt’s competitiveness from a cost perspective.

Cairo also attracted the firm’s interest thanks to its large population of IT graduates and Seif highlighted that every year around 100,000 students graduate from the city’s universities with a degree in science, technology, and computer engineering.

The new center will support a range of Capgemini’s service lines, including consulting, technology, and business process outsourcing (the managed services division).

French headquartered Atos is one of the latest companies to announce the opening of a Global Delivery Centre in Egypt, with plans to grow the centre rapidly over the next year based on the initial success. Sven?Hesterman,?Head of Global Delivery Centers Atos,?said?“We are proud?and excited to open a new Global Delivery Centre in Egypt, adding our network of?award-winning centres around the world. The talented and diverse workforce in?Egypt is an excellent addition to the thousands of dedicated colleagues we have?in our centres around the world, serving our customers on a daily basis.”

Bérénice Chassagne, Head of Growing Markets at Atos, said?“Egypt is an excellent location for a new Atos GDC, not only because of its strategic geographic location and good infrastructure, but also its robust language capabilities and diverse culture. It is strategically located to provide our customers with all the benefits of scale and flexibility. The decision to open a new Global Delivery Center in the city of Cairo reinforces our commitment to growing markets as one of our key elements in ensuring optimized and high-quality delivery to our clients”.

Now with 350 IT professionals, Atos in Egypt plans to hire another 1,000 employees over the next 12 months.

The Egyptian Government has provided a helping hand in the form of tax incentives, a stable business friendly environment and promised long term support for the strategy of building a knowledge based economy. As Zenah Al Saraeji, a senior research for Global Property/Technology company JLL states – “The Egyptian government has come to play a crucial role in fostering the growth of the outsourcing industry. Recognizing its potential, the government has actively supported the development of the Information and Communications Technology (ICT) sector, which serves as a catalyst for attracting investors to choose Egypt as their outsourcing destination and business service hub. The ICT sector has experienced significant growth, with a nearly 17% increase during the fiscal year of 2021/2022, making it the fastest-growing sector in the country. Egypt has a stable political regime along with close and cordial relations with all neighboring countries in the Middle East, including Israel and Palestine. In fact Egypt may be seen as a beacon of stability in an increasingly tumultuous world. The launch of the "Digital Egypt Strategy for the Offshoring Industry 2022-2026," a comprehensive five-year plan, has further bolstered this sector. Aimed at tripling export revenue generated from offshoring services, the innovative strategy also aims to create approximately?215,000 job opportunities?in the field. Having welcomed 29 global firms into Egypt last year, the government aims to generate additional jobs in sectors such as Business Process Outsourcing (BPO), IT services, and engineering,?with a combined annual export value of USD 1 billion.?These initiatives, coupled with financial incentives and tax reductions, have contributed to Egypt's attractiveness as an outsourcing destination.”

The companies highlighted above provide an indication of some of the larger enterprises who have publicly announced their plans for Global Development Hubs in Egypt. However, this is likely the tip of the iceberg and tends to represent first movers. Over the next 12 months it is anticipated that there will be a large number of announcements by significant Global players who plan to set up in Egypt.

Why are companies rushing to Egypt – let’s look at some of the factors driving this?

India / Asia under salary and retention pressure

Aside from the in-house option, which can be increasingly difficult and expensive to find, the traditional go to outsourcing locations for Western European companies have been India and the Far East; and more recently Eastern Europe. Each region comes with plus and minus points, but in recent years a major issue for India has been the sheer level of demand for talent and thus salary inflation leading developers to jump ship regularly for marginal salary increases. Churn rates in many cases have been running at upwards of 35%, which makes managing projects and teams extremely difficult, particularly where complex platforms may require several months of developer ‘burn in’ to fully understand the product.

Disruption in Eastern Europe

Eastern Europe has been a rising star in the outsourcing world over the last 10 years, with Ukraine in particular being a source of top class talent to support clients worldwide, including a sizeable number of Silicon Valley unicorns. However, at the time of writing it does not appear that the war started by the Russian full scale invasion will end anytime in the immediate future, and the disruption caused by the war is also having effects in the wider region. Developers from Russia and Belarus have essentially been removed from the available talent pool, and the war has caused widespread migration and disruption across the region, leading to significantly reduced talent availability coupled with wage inflation and leading to historically high pricing and limited availability.

Within this disruptive geopolitical environment, a relatively new and promising outsourcing option has recently started to gain traction amongst forward thinking CTO’s – Egypt! Egypt has a number of advantages as an IT development outsourcing location which may be a surprise to any CTO who has not researched the country.

Location

Egypt is conveniently situated in the CEE time zone (2 hours difference from UK, 1 from central Europe) and therefore with the same time zone advantages as traditional Eastern European locations. There are regular flights ?to the main destination centres with flight times around 4.5 hours and straightforward visa on arrival availability. The main population centres have extremely well developed infrastructure, hotels and communications, as well as opportunities to visit local points of interest such as the historic sight and beach/diving centres. Egypt also has a stable relationship with neighbouring countries and so is unlikely to? be caught up in any regional hostilities aside from in the form of mediators.

Talent Pool

Egypt is a country of over 120M people, with approximately 600K graduates annually of which 100K specialise in ICT/STEM. Most of the universities typically teach their ICT courses in English and a recent EY survey found that over 80% of the working population have an English language proficiency of intermediate or higher.

The Egyptian government is actively working to provide incentives and training in order to increase the talent pool and future projections include a substantial growth in this industry. Industry watchers have highlighted the quality of Egyptian developers, which tends to be on a par with similar nearshore locations such as Poland, Romania and Ukraine.

As well as having a huge talent pool, availability and retention are good. In addition to the mainstream skills such as Java, .NET, JavaScript, Python etc Egypt also has access to niche skills that are more difficult to source e.g. Scala, Ruby, Golang and Erlang.

The rapid advance of ubiquitous high speed internet and IT infrastructure in recent years has helped to enable and unlock the potential of the exceptional talent pool.

Price Point

Egypt compares very favourably with other nearshore destinations, with typical day rates for senior developers approximately half of those in Eastern Europe. The countries financial situation is challenging, with recent currency devaluations, and therefore costs are unlikely to come under any significant pressure in the foreseeable future, and working with international clients provides an added incentive for top developers.

Conclusion

Whether considering sports data or other areas of IT support, at a time when there are serious challenges globally with existing popular IT development outsourcing locations, it is worth seriously considering Egypt as a nearshore location.

The combination of high quality skills, excellent talent pool and extremely competitive pricing sets up Egypt as a real contender in this space and it looks likely that Egypt will become one of the next IT Outsourcing Powerhouse destinations over the coming years.

How to Take Advantage of the Egyptian Outsourcing market

Whilst most companies will not have the resources or demand to establish massive development hubs in the style of Vodafone or PwC, there is an option that allows smaller enterprises to take advantage of the amazing talent pool and cost savings available.

SAQAYA are a fast growing UK based IT Development Outsourcing company with a development hub in Egypt and founders who are Egyptian/British. The company are able to provide high performance agile development teams to work with Western European clients at half the cost of traditional nearshore locations, and with developers in the same time zone as Eastern Europe. Founder and CEO Dr Ahmed El Kalagy (Kal) states “the Egyptian IT market is still in its infancy and the potential for growth is enormous. We are able to help clients scale quickly with extra productive teams at minimal costs – and thus bring the benefits that larger companies like EY and Atos are already experiencing with their Egyptian development hubs. What’s more – our company headquarters are in London and our management team have a razor sharp focus on client satisfaction – our success is based on our clients success!’ Kal adds an invitation “For any clients considering working with an Egypt based development partner, we will be happy to organise and host a reference visit to our operations in Cairo where you can see for yourself the magic of the emerging Egyptian tech scene – as well as taking the opportunity to visit the wonders of ancient Egypt such as the pyramids of Giza and the new Grand Egyptian Museum.”

Whilst the larger and established outsourcing companies have not yet managed to penetrate the Egyptian market, working with companies like SAQAYA, clients are able to leverage the skills and dynamism available in Egypt with ease.

So let’s watch this space for the rise of the Egyptian outsourcing and sports data market – and to find out more how to get in on the action drop a line to [email protected] www.saqaya.com

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