The Yahoo! acquisition of Maktoob.com has been hailed as a new dawn for the IT sector. A new dot-com boom set to explode in the Middle East! Some are even perplexed by the media's rather uncaring take on the deal (the amount of coverage received not as much as they would like to think). While it is always good to see money pumping in the Middle East for any sector, I just don't see everyone in the world coming down here and buying out companies.

Yahoo! has no interest in, perhaps, Maktoob's most innovative product, araby.com. The only thing that interested Yahoo! is the overwhelming number of eyeballs Maktoob managed to amass throughout the region. While it is a clever way to make yourself attractive for an acquisition, it isn't exactly the pinnacle of innovation.

So, let us please not go overboard with self-congratulations that is so typical of the region without actually looking at what is happening around us.

The Maktoob guys did an excellent job at acquiring websites that generate traffic, with this process in boost mode during the past 2 years. Namely, this has become a huge focus for Maktoob since the initial talks with Yahoo. So now that we understand exactly what Yahoo bought, we ask, what does it all mean?

Digital Goes Competitive

It means that digital advertising is going to become a very competitive sector now. Yahoo! doesn't care what bintelhalal.com has to offer, it just cares that it has more eyeballs to add for advertisers.

You have Google coming in here and setting up what I can only call a mini-representative office. Microsoft doesn't seem to be bothered with the whole region, as far as advertising is concerned.

Then you have players like Emap Communications who acquired AMEInfo back in 2006. This has not been a game changer. Google entered afterward and now Yahoo. So, it has been a slow but clear progression of international players getting in on the digital action.

I see ratecards becoming more realistic as competition heats up. As it stands, digital advertising is ridiculously expensive for what it is (in my humble view). Google's adwords still come out as the clear winner in terms of bang for your buck, unless you have some very specific requirements.

VC's Come Running?

Not likely. Most people don't quite understand what it is exactly that Yahoo! bought. This might stimulate a few VC's into considering the region's start-ups, but I just don't see it happening. Such growth has to be organic. I also don't see much innovation coming out of the region so far.

Innovation? What Innovation, We Can Do a Copy

Are you seriously telling me that Watwet is innovation? Don't get me wrong, it's a great effort by the guys.. but all this still remains amateurish. No one seems to be thinking globally, at ALL! It is actually quite frustrating.

Even if you weren't going to think on a global level and plan for future acquisition.. I have yet to see anything that would come close to innovation aside from Araby.com.

Let's not feel down about this though.. looking at India, I can hardly name anything that came out of this huge powerhouse of IT. Aside from call centers and a cheap alternative to outsource parts of the job, India has failed to deliver innovative solutions. There is no facebook that was started in India. No twitter, no Google no.. nothing.

Perhaps my definition of innovation is a bit more strict than most people's. You can be innovative in growing an industry and creating jobs. However, if you want to be truly innovative, you have to be able to deliver world-class NEW services/products.

So It's All Bad?

No, not at all! It's great! I just don't want people to get over-excited about things and then face disappointment when nothing happens.