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TECOM Group runs 11 sector-focused communities in the real estate and information technology industry of Dubai, UAE. Formerly known as TECOM investments, it was founded in 2005. The group is owned by Dubai Holding, a global investment holding company majorly involved in a wide range of businesses in several countries from all over the world.
TECOM has a number of subsidiaries, most of which are based in the city of Dubai. Each of these subsidiaries provides a different product for different consumers in the UAE and globally at large. They include Dubai Industrial Park, Dubai Outsource City, Dubai Internet City, Dubai Media City, Dubai Production City, Dubai International Academic City, District and Dubai Wholesale City, Dubai Knowledge Park, Dubai Science Park, Dubai Design, and Dubai Studio City. Some of the main subsidiaries are described below:
Dubai Internet City
This is a free trade zone which was created as a hub for all types of communication and information technology companies. Horovitz and Ohlsson describe it as information Technology Park (2005). The free economic zone provides a number of benefits for companies, including taxes and ownership, which are all allowed by the law for up to 50 years. These benefits have attracted giant global companies such as Facebook Inc., Microsoft, Cisco and IBM to move their regional headquarters to the Dubai Internet City.
Dubai Media City
This is a free economic zone media park founded by the government of Dubai in 2000 and run by TECOM group in Dubai. It is the media industry hub of the UAE, GCC as a whole and the Middle East. The company provides infrastructure such as fiber optic cables and communication towers for more than 1000 companies which have been registered in the Free Trade Zone (Bagaeen, 2007). The infrastructure and environment offered by the city have attracted several organizations which have ventured into advertising, online media, broadcasting and production as a result of operating procedures being made easier by the government for organizations carrying their operations with the zone (Pacione, 2005). This has led to the tremendous growth by the hub over the last decade due to increased investment by different companies from within the GCC region and overseas.
Dubai Design District
Known as D3, It is dedicated for firms and individuals in the design industry. The hub will provide all of the infrastructure required by entrepreneurs, established international design brands, start-ups, and fashion design firms (Irish and Walid, 2009). This district is still under construction, whereby its first phase of development has already been completed.
Dubai Science Park
Founded by TECOM in 2015, this is a business community aimed at providing state of the art laboratories and other facilities for entrepreneurs, start-ups, SMEs and individuals in the science sector. According to Seoudi and Mahmoud, the park has become specifically focused on life sciences, environmental science, and energy sector (2016). The Science Park consists of sufficient warehouses and science laboratories to ensure that Vision 2021 of Dubai is attained through entrepreneurship and innovation in the sector of science.
TECOM has come up with a number of subsidiaries, each providing different products based on the consumers’ interests. This is especially useful for the TECOM group to come up with profiles of the key segments so as to properly understand their needs and also pinpoint what motivates their purchase (Fahy & Jobber, 2012). Based on the shared characteristics, interests and specializations of the consumers in each segment, the group is able to tailor their products and services appropriately for each group of consumers.
For instance, Tecom’s subsidiary company, Dubai Media City is aimed at grouping all consumers in the media industry together to form a market segment. This is because the individuals in the media fraternity have common interests and characteristics in terms of their work standard and professional requirements. This way, the media houses, and advertisers have been attracted to the media hub due to the adequate facilities provided by the company. This shows an efficient strategy of market segmentation implemented by the Group to ensure efficient specialization of attention to the various segments to maximize sales (Beraja, 2016).
TECOM is aimed at enabling Dubai to attain its Vision 2021 by promoting innovation and investments. To achieve this, TECOM has to establish a large market base to enable it to earn sufficient proceeds. TECOM has a wide market target in the United Arab Emirates alone. Dealing in the real estate industry, Tecom has a large number of potential consumers, who are interested in the free trade zones which are provided by its various subsidiaries, such as the Dubai Media City (Shayah & Qifeng, 2014).
Regionally, Tecom has targeted the GCC nations and the Middle East as a whole. Firms from countries in the Middle East such as Pakistan’s Geo News TV and ARY One World have been known to conduct business with the Dubai Media City subsidiary of Tecom. The firms were attracted by the standardized and state of the art infrastructure and facilities provided by the DMC. With these facilities, Tecom group’s potential target market is wide.
From a global perspective, the free trade zones in Dubai being run by the group’s subsidiaries have attracted key global technology firms such as Intel, Cisco, Microsoft and IBM (Abdulla & Nicholson, 2009). Initially, Dubai Internet City may not have been intended to venture into the global market, but as soon as the regional consumer firms began arriving into the city, it triggered them to begin considering the global market. Geographic and behavior market segmentation and targeting is the main strategy used by Tecom and its subsidiaries to sell their product to the potential consumers.
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TECOM group has been continuously expanding and acquiring new subsidiaries over the past ten years. Dubai Biotechnology & Research Park together with the Energy and Environment Park were two of the major projects led by the Group. They were fused to form the Dubai Science Park in 2015. There are also a number of projects by Tecom under construction. Chief among these is the Dubai Design District, which is likely to expand the group’s property, consumers, and total market base.
There are also considerations of building such hubs as the Dubai Internet City in other parts of the world, such as in the United States. These prospects are however yet to be implemented. The owner of the Tecom group, Dubai Holding is a multinational company, which means that it is highly possible for the group to expand its subsidiaries internationally. Currently, the Group is focusing on expanding in the city and UAE as a whole before venturing into global expansion.
Contribution of TECOM to UAE economy and GCC nations
The TECOM Group has contributed greatly to the economy of Dubai and the United Arab Emirates as a whole. To begin with, the group offers affordable office space, business consultation services, investment advice and other facilities for individuals to establish start-ups. This way, the growth of small firms has been stimulated (Pacione, 2005). Entrepreneurs have been given chances to develop their ideas into big firms through these opportunities offered by the group.
Secondly, the group has provided the citizens of the UAE and those from the various GCC nations with a high number of employment opportunities. By providing better-paying jobs, the group has significantly improved the livelihood of these people (Al Marashi & Bhinder, 2008). This has improved the overall economic situation of United Arab Emirates because the citizens’ social classes have improved.
Thirdly, the education standards in the country have been improved immensely. Traditionally, the citizens of the city of Dubai and the UAE, in general, were dedicated to the Oil and Natural Gas business. However, this has changed as many people are venturing into science and technology. By providing hubs such as the Dubai Internet City, institutions such as the Dubai Microsoft Campus has led to the education and enablement of the various innovative minds of the young people of the United Arab Emirates to come up with ideas that can help solve the various problems being experienced in the world through Information Technology. This is a huge step in the growth and development of the UAE and GCC nations by promoting innovation. Other hubs such as the Dubai Science Park have also proven to be useful by providing facilities such as laboratories and warehouses to facilitate research on environmental science and biotechnology (Ahmed & Abdalla Alfaki, 2013).
Fourthly, the TECOM group has made it relatively easier for business to be conducted in the UAE through its subsidiary, Dubai Wholesale City. Available and affordable products in this mall have led to continuous money circulation through trading between the suppliers, manufacturers and mall owners in this city. Sufficient money circulation is among the main pillars of a stable economy (King, 2003).
Fifthly, the government’s revenue has increased over the years due to the fact that there has been a high population growth, which has increased the levies paid by the citizens and organizations to the country. This revenue has been put into better use by the government, such as building better schools and hospitals, improving the health and literacy of the citizens of the UAE.
Finally, the group has influenced the massive construction of modern infrastructure in the city. The urban road network interlinking the various hubs of the group, Communication towers for the Dubai Media City, the fiber optic network cable for fast and reliable communication network, the national power grid, has benefitted the country and other GCC nations by making it easier to transport goods and raw materials, not to mention easy commuting to and from the workplace by the people of Dubai. These have led to a sharp reduction in the rate of traffic congestion in the cities, thus saving energy, time and money. In the long-run, the resources that could have been wasted are used to carry out different tasks of a more positive contribution to the country’s economy.
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TECOM group, as a unit of Dubai Holding, has a wide range of products which they offer to the people of the GCC nations and other nations in the global market. The group’s ventures in the real estate and investment industries have been promising thus far. Their quality products have attracted giant global technology firms which have improved the general economy of Dubai. The free trade zones which have been provided by the group and the government of Dubai can be adopted by other companies and cities to spearhead fast economic growth such as the one which has been influenced by the TECOM group in the UAE.
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