PUBLISHER: Arizton Advisory & Intelligence | PRODUCT CODE: 1664164
PUBLISHER: Arizton Advisory & Intelligence | PRODUCT CODE: 1664164
The Middle East data center construction market by investment is expected to grow at a CAGR of 23.91% from 2024 to 2030.
KEY HIGHLIGHTS
KEY TRENDS
Adoption of AI
The Middle East region is experiencing a notable increase in the adoption of AI, driven by technological advances and growing recognition of its transformative potential across various sectors. Countries such as the UAE and Saudi Arabia are at the forefront of AI integration, with initiatives spanning healthcare, finance, transportation, and more. For instance, the UAE has launched the "UAE Strategy for Artificial Intelligence" to position itself as a global leader in AI by 2031. Similarly, the National AI Strategy in Saudi Arabia aims to drive economic growth and enhance quality of life through AI-driven innovation.
Usage of Green and Sustainable Sources
The use of green and sustainable sources in the Middle East data center construction market is gaining momentum as operators and governments prioritize energy efficiency, reduce carbon footprints, and align with global sustainability goals. Khazna Data Centers focuses on energy-efficient operations and renewable energy sourcing. Equinix is targeting carbon-neutral operations globally, including in the Gulf region. STC (Saudi Telecom Company) is including green initiatives in its data center designs, supporting the Kingdom's Vision 2030 goals.
Smart City Initiatives
Smart city initiatives are rapidly emerging in the Middle East region, fueled by a commitment to improve urban living, promote sustainability, and drive economic growth. Pioneering countries like the UAE, Saudi Arabia, and Qatar are spearheading ambitious projects that aim to utilize technology to enhance infrastructure, transportation, and public services. For instance, Dubai's Smart Dubai 2021 strategy seeks to turn the city into a global innovation hub by incorporating advanced technologies such as AI, IoT, and blockchain. Additionally, the NEOM project in Saudi Arabia is anticipated to be one of the most notable smart cities worldwide, with an estimated investment of around USD 500 billion, and is expected to make a significant impact once it becomes operational in 2025.
SEGMENTATION INSIGHTS
There is a notable shift toward sustainable infrastructure with increasing adoption of biofuels, solar energy, and liquid cooling solutions in the Middle East data center construction market. As the region faces high energy demands and extreme temperatures, data center operators prioritize energy-efficient and eco-friendly technologies. Furthermore, biofuels are being explored as alternative power sources to reduce reliance on traditional grid energy, helping to lower carbon footprints. On the cooling side, liquid cooling technologies are becoming increasingly popular due to their superior efficiency in handling the high heat output of modern, high-performance computing systems. These innovations not only enhance cooling efficiency but also contribute to lowering the overall environmental impact of data center operations in the region.
GEOGRAPHICAL ANALYSIS
Countries like the UAE, Saudi Arabia, Israel, and Qatar have emerged as key players, leveraging their connectivity advantages to attract global enterprises and cloud providers. The UAE, particularly Dubai, serves as a regional data center hub with robust infrastructure and international connectivity, while Saudi Arabia invests heavily in digital transformation and smart city projects, notably through its Vision 2030 initiative. This geographical positioning, combined with improving digital infrastructure, creates a dynamic ecosystem that supports the increasing demand for data storage, cloud services, and edge computing across the region. The strategic location of the region is poised to play a critical role in the future of global data networks and support the Middle East data center construction market growth.
VENDOR LANDSCAPE
Key support infrastructure providers in the Middle East data center construction market include Airedale, ABB, Alfa Laval, Caterpillar, Johnson Controls, Schneider Electric, Siemens, and Vertiv. These companies facilitate the seamless integration of emerging technologies like AI and 5G within data center settings, assisting operators in addressing the increasing demand for high-performance computing.
On the investment side, prominent players in the Middle East data center construction market include Khazna Data Centers, center3, Equinix, Gulf Data Hub, Batelco, Mobily, Ooredoo, Edgnex Data Centres by DAMAC, and Quantum Switch, among others. Additionally, notable newcomers such as Agility, DataVolt, Pure Data Centres, Anan, Qareeb Data Centres, and others are entering the Middle East data center construction market. These new entrants are pivotal in fostering innovation and have the potential to drive down costs for both operators and consumers. Their focus on advanced cooling and energy-efficient solutions contributes to expanding regional capacity to satisfy the rising demand for cloud, AI, and edge computing services.
Key Data Center Support Infrastructure Providers
Key Data Center Construction Contractors
Key Data Center Investors
New Entrants
The report includes the investment in the following areas:
KEY QUESTIONS ANSWERED: