ANYONE who doubts the growth potential of the regional IT sector should take a look at the latest internet survey by Dubai-based Dabbagh Information Technology (DIT) group. Covering the period December 1998 to April 1999, the report estimates that in the first four months of last year, the number of internet subscribers in the Arab world soared by a staggering 43 per cent to 338,200. This stunning performance occurred as the Middle East and North Africa was only just beginning to emerge from the worst oil price slump in over a decade.

Several exceptional factors came into play during the period. The most important was in Saudi Arabia, where internet connections became available locally for the first time. As a result, the number of subscribers jumped by an estimated 140 per cent to 45,000, DIT reports. Previously, in-kingdom access to the internet had been confined primarily to the eastern province through internet service providers (ISPs) based in Bahrain.

The second highest growth in the DIT survey was in Lebanon, where internet access rose by more than 60 per cent to 52,700 at the end of April. The Lebanese figure is inflated by the fact that local ISPs also provide services to Syria, where connection is limited to selected institutions.

In the more developed internet markets, subscriber growth is still strong. The UAE, which has the highest internet penetration in the region, saw its subscriber base climb by 33.5 per cent to 81,700 in the first four months of 1999. Even here, there is considerable scope for growth, with forecasts suggesting that by 2002, some 64 per cent of the local population will have access to the web, compared to just 14 per cent in 1998.

In terms of actual users, DIT estimates that there were 923,100 in the Arab world at the end of April. In calculating the figure, an average 2.5 users for each account holder was assumed, with the exception of Egypt, where it was put at four.

DIT has followed up on its internet user survey by publishing market reports on e-commerce and user profile. The e-commerce survey says that in the year to the end of April, Arab consumers spent an estimated $95 million on goods purchased on the internet, a nine-fold increase over 1997. According to its sample of 1,000 users, about 30 per cent made only one purchase on the internet while an estimated 18 per cent bought three or more items. The most popular goods were software, accounting for 48 per cent of the total, followed by books (28 per cent), and computers and peripherals (26 per cent).

DIT's other survey on the profile of regional internet users showed that in the 18 months to last August, 59 per cent of all users held a university degree. The fastest growth, however, came from users with only a high- school certificate, whose share of the total rose to27 per cent from the previous 17 per cent. The report also highlighted that in contrast to Europe, the majority of users, 72 per cent, accessed the internet from home, compared with only 22 per cent in the office.