A little more conversation

By Ebele Okobi | Director, Yahoo! BHRP

James Emery | Flickr Creative Commons

Hello, and welcome to the Yahoo! Business & Human Rights Program blog! For the past few years, Yahoo! has been focused upon how to address the fact that our business increasingly intersects with human rights issues around the world, specifically user privacy and free expression on the Internet. We know that we have a responsibility, like all companies, to act responsibly in the communities in which we operate, and we have taken action, including funding academic fellowships, creating the Yahoo! Human Rights Fund, engaging with governments, and helping to co-found the Global Network Initiative.

You can read more about our initiatives on our website, at humanrights.yahoo.com.

At Yahoo!, we believe that access to information improves lives and advances human rights around the world. We also know that with almost half a billion users around the word, we have an opportunity to raise awareness about free expression and user privacy.  The issues at the intersection of technology and human rights are complex, and we believe that we can only benefit from transparency and an open exchange of ideas with engaged and informed people around the world.

With this blog, we are hoping to start a conversation. Will you join us?

by Ebele Okobi-Harris |  Director, Business & Human Rights Program

Yahoo’s bold advance into the Middle East

By BHRP

By Douglas MacMillan

Businessweek, August 26, 2009

On the pages of Arabic-language Web site Bentelhalal, men and women from Saudi Arabia, Egypt, and other parts of the Middle East and North Africa list personal details and describe the qualities they’re looking for in a mate, such as “polite,” “stylish,” and “God-fearing.” It’s reminiscent of an American dating site, except for one big twist: All of these singles are ready to marry.

Bentelhalal is one popular site within Maktoob, the large Jordanian Internet property Yahoo! (YHOO) said it was acquiring on Aug. 25 for what the Web site TechCrunch reported to be $85 million. It’s also a sign that Yahoo, which trades in tech news and celebrity gossip to assemble its audience at home, has entered a different world.

The purchase gives Yahoo command of one of the most visited online news portals in the Arab world, with business, finance, games, blogging, and other sites that reach an estimated 16.5 million people. Yahoo says it will translate its home page, e-mail, and instant messaging services into Arabic but plans to keep Maktoob’s local flavor mostly intact.

While rivals Google (GOOG) and Microsoft (MSFT) have waded cautiously into the emerging Middle East, Yahoo will be the first major Internet company from the West to run a full online content business in the region. How the company navigates the cultural and legal norms of the Arab world will be watched closely by competitors back home. So will its approach to Internet censorship.

Maktoob: Supported by Online Ads

The relatively tiny market for online ads in Arab countries has companies stepping carefully into the market. Microsoft partners with an Egyptian ISP for its MSN Arabia site, and Google offers an Arabic-language version of its search engine. But neither has entered the Middle East with as much conviction as Yahoo. “Many of the emerging markets are very similar. You have nascent penetration of online users and ad dollars,” says Keith Nilsson, Yahoo’s senior vice-president for emerging markets. “The Middle East is unique because you have a contiguous language which a very large population speaks—one of the reasons we were interested in this acquisition.”

The market for online advertising and transactions in the Middle East may be tiny by Silicon Valley standards, but experts say the potential is huge. Maktoob is largely supported by online ads, which are expected to make up a $142 million market among Arabic-speaking countries by 2011, according to Dubai-based Madar Research.

“The Arab citizen is hungry for local content in their local language, and this is something that has enormous potential” for Internet companies, says Soumitra Dutta, a professor of business and technology at Paris business school INSEAD. Dutta says the Middle East has improved its technology competitiveness faster than any region in the world over the past five years, according to a study he conducted with researchers from the World Economic Forum. Technology companies that include Cisco Systems (CSCO) and SAP (SAP) are seeing fast growth in the region, and Cisco has been investing aggressively there.

Yahoo sees its success in the region dependent on catering to local markets. “We have to have a team in place that understands the nuances between each country,” says Nilsson. While Maktoob currently has a sales force in five countries, Nilsson says the plan is to develop local sales forces in all countries the site reaches.

“Political Filtering” in the Region

As it expands to the Middle East, Yahoo is taking pains to avoid the kinds of government complications it has encountered in Asia. In 2004 the company was criticized for providing information to the Chinese government that critics say led to a 10-year prison sentence for journalist Shi Tao. Since then, Yahoo has helped form the Global Network Initiative, a symposium of Web companies and advocacy groups that share advice about dealing with foreign governmental requests. So far, the efforts appear to be paying off in Vietnam, where the company is expanding despite government restrictions on blogging and other online activities.

The Arab world will be another test. A March report from Paris-based Reporters Without Borders listed a number of regional states—including Egypt, Iran, Saudi Arabia, and Syria—on its annual list of countries it considers “enemies” of the Internet for jailing bloggers and otherwise preventing free speech on the Web. “Political filtering is strong in the region,” says Rob Faris, research director for Harvard University’s Berkman Center for Internet & Society.

Yahoo says it plans to abide by local laws while operating Maktoob but will also protect users’ freedom of speech. Yahoo Deputy General Counsel Michael Samway says when the company was performing its due diligence, it studied “the potential intersection points with human-rights challenges.”

One cautionary measure was already in place: Maktoob keeps its users’ private information stored on servers “outside the region,” which would prevent them from being subject to local governments’ demands.