Yahoo! Maktoob: Ready to Deal With Freedom of Speech and Piracy Issues?


Yahoo! Maktoob

After almost 2 years of rumors about this deal, Yahoo! made a big move last week when it purchased the Arabic portal Maktoob for an estimated $85 million. This is certainly one of the biggest moves in the Middle East’s tech field, and with it Yahoo! has cemented their policy of focusing on emerging markets, and cashing in on the growth of those markets. After establishing presence in Southeast Asia, India and Latin America, Yahoo! now has a foot hold in one of the biggest untapped markets in the world.

The Arab speaking world is composed of about 320 million speakers, of which about 41 million are Internet users. In addition to that, the region has an impressive adoption rate of over a 1,000%. Previously, both Google and MSN took shy steps by establishing a presence in the UAE and Egypt and creating partnerships with local ISP’s and attempting to educate the market about online advertising, but Yahoo! blew their efforts out of the sand.

The Arab market is ripe for picking and, with this move, Yahoo! has taken the lead in that race and will remain there if they are able to cater to the market’s needs. The reality is that only 1% of Internet content is in Arabic, so there is a void and even hunger for Arabic content on the web. Yahoo! hopes to capitalize on this by their purchase of Maktoob, and extending their current portal by making it relevant to Arabic audience.

So who is was created to especially cater to the void tof Arabic content on the web. In 1999, Maktoob was established in Amman, Jordan by Samih Toukan and Husam Khouri with the aspiration of leaving an Arabic footprint on the web by establishing the first Arabic web-based email service. Throughout the years, Maktoob grew and kept on expanding and trying to tackle the local needs of the Arabic market. Currently, their services include a search engine (, social networking, blogging, a dating site, and about a dozen other services catering to the market. Their portal experienced an impressive growth in their number of visitors after they acquired several popular Arabic forums, and today the portal attracts over 16 million regular visitors ranking it amongst the top 10 for most Arabic speaking countries.

Maktoob & Yahoo Rankings

Maktoob & Yahoo Rankings

Where Will They Start and What Are The Prospects of Profit?

After the deal, Maktoob will re-brand to Yahoo! Maktoob still retaining its local charm. Initially, Yahoo! Maktoob will tackle the localization of Yahoo! Mail, Messenger, Search, and the Yahoo homepage and eventually move towards creating local versions of news, sports, and finance with a focus on relevance.

When it comes to Yahoo!’s bread and butter, online advertising, they hope that their combined audience of about 36 million users – with some overlap – will be a great challenger to Google AdSense in the region. Also, that will provide advertisers in the region with an unprecedented opportunity to reach and engage online consumers in the region and it’s expected that online advertisements revenue will grow about 35-40% during this year, according to Madar Research.

Any bumps along the road?

It will be interesting to view how Yahoo! Maktoob will evolve, but there are some concerns that will arise along the way that are not all that unfamiliar to Yahoo. First of all, how will Yahoo tackle issues of privacy and freedom of speech? Given that their policy in China came under fierce attack in recent years and it wasn’t the best way to handle the situation; there are doubts regarding how they will handle it in the Middle East. In a region that is well known for their lack of free press and gated societies, will Yahoo be able to maintain their integrity?

The second concern is that while the acquisition didn’t include all of Maktoob’s servicesthe remaining services including an eBay-like auction site and an Arabic search engine will operate under the Jabbar Internet Groupit did include forums like, which is filled with pirated DVD’s, software, and music. This poses a legal problem for Yahoo! that might be a bit thorny since it’s one of the draws of service in its current form, will yahoo be able to resolve it without losing the current audience?

What I Think:

While opinions might differ about whether Yahoo! did the right thing to acquire Maktoob, or whether it paid too much for it, one thing is certain: it was a bold move by them to venture into a new market, and hopefully it will be a successful move that will encourage other big players to start shifting their focus into investing in those emerging markets and help bring some of that web goodness in flavors other than English only.

Maktoob in Arabic means either “letter“, “written, or “destined“, so is this relationship destined to succeed? What are your feelings about how the Internet is developing in emerging markets? Does the lack of any big European Internet corporations affect the Internet negatively or positively?

Comments and Reactions

  • Beiruta

    I think Maktoob and Yahoo! are a match made in heaven! :) Basically, it's as simple as this: to every good plate, there's a list of ingredients that spice it up and bring it to perfection. If Yahoo! is able to handle the piracy issues you have mentioned as well as overcome the freedom of speech barriers, this will result in a good dish!

    Furthermore, and to answer your questions, I think the Middle East need this European intervention in the field of Internet and Web development to be able to compete more globally! And yes, emerging markets are a really good target for investors since there is no saturation and less competition. The trick is to be able to play it right!

  • conodonnell

    Hi Bam,
    Good piece and definitely this will boost the interest in the region, but especially give encouragement to all those smart individuals who have great ideas but lack funding (or hope of turning them into cash) step up to the challenge. The piracy and freedom-of-speech issues will definitely come to the fore, and I welcome a strong stance on both from Yahoo! Well done Maktoob who have built a great internet business in a tough region with the odds stacked against them.
    Regarding your last point, although no European internet corporations have joined the fray, Vodafone has. They might not qualify strictly as an internet corporation but they are European (in origin) and they are entering the internet space rapidly. Vodafone Egypt acquired my company (Sarmady) last year and are expanding both fixed and mobile internet here in Egypt, investing in Arabic content, access, technology, applications and digital advertising.

  • M.Bamieh

    Thats really interesting, and i'll have to look at your company a bit closer. Egypt is definitely one of the better markets in the region and they are definitely doing the right thing by investing in it. I think its a win-win situation for anyone investing currently in the Middle East's internet future. thank you for your comment

  • FadiPick

    You have posed 2 real big concerns to @Yahoo: Freedom of Speech and Piracy. I am sure that both will not make their acquisition of Maktoob easy, but it won't either weight the benefits they wil get from this deal. Maktoob is the biggest internet portal in the region, and it should really give Yahoo! a great push in this emerging market.

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