The UAE data center and cloud services industry is quickly growing as a result of the country's growing tech-savvy population and wide range of services: Ken Research

March 2023  

1. UAE data center market generated over $400 Mn with presence of 20 data center across UAE in 2021.

UAE data center marketAWS created three data centers in 2022, Etisalat and G42 have partnered to provide the largest data center, and Oracle will open a second cloud region in the UAE are just a few instances of the rising data center infrastructure in the UAE. In order to assist social and economic success and increase the value of the digital economy, the UAE government will also speed up technological development and implement the most recent ICT projects.

2. Rising investments and diverse service offerings with improved connectivity and internet penetration are major growth drivers in the UAE data center market.

UAE data center market Revenue

Due to the fact that local and international businesses invested more than $5.3 billion in IT businesses in the UAE in 2021, more data center facilities were built throughout the nation. The nation's strategic location between Asia, Europe, and Africa makes it an ideal site for business. Additionally, 99.0% of the population in the UAE had daily access to the internet, and smartphone penetration was 97.6%, placing the country at number 22 in the world for internet usage. Finally, data center firms provide a variety of backup and recovery services utilizing best-in-class technology and high-bandwidth connections.

3. The UAE cloud services market was observed to grow at a positive double digit CAGR, generating over $400 Mn as revenue over the period 2016-2021

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The market for cloud services in the UAE has had phenomenal growth as a result of an increase in online activity, particularly in all workplace systems, as well as investments and new market entrants. Additionally, organizations from industries including government, aviation, finance, manufacturing, and healthcare are among those already utilizing the cloud regions. The demand for data storage will also rise due to increased online media consumption, the installation of IOT devices, and sensors in manufacturing facilities, as well as the growing demand from SMBs for cloud solutions.

4. Uncertain regulatory framework, environmental conditions, cyber-attacks, and power costs are some of the issues confronting the UAE data center market.

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It is difficult for market actors to conduct business because each of the seven emirates in the United Arab Emirates has its own laws and regulations. Additionally, while ranking fifth in the Global Cybersecurity Index for 2020, the UAE is still susceptible to data breaches and cyberattacks. In addition, the UAE Data Center's power usage and cost index are significantly greater than those of other Middle Eastern nations. Finally yet importantly, raising the working temperature has a detrimental knock-on impact on the condensers, which become overkill on the efficiency of these cooling units and associated outdoor units are oversized to compensate or offset UAE’s ambient conditions.