10/14/2021

Saudi Arabia expands plan to develop digital infrastructure to build and enable mega data centers

The Ministry of Communications and Information Technology of Saudi Arabia has revealed a set of cooperative initiatives with four new companies to develop and build mega data centers, distributed over several regions across the Kingdom, and work to enable the utilization of renewable energy production sources for sector development and environmental sustainability.

These developments come as an extension of the ministry's plan in line with realizing the goals of Saudi Vision 2030, which aims at the Kingdom’s transition from an economy based on natural resources to a digital economy directed by innovation.

The digital infrastructure plays a pivotal role in accelerating the stages of advanced digital transformation, adopting emerging technologies to build an interconnected present and an innovative future, in addition to consolidating the Kingdom’s role as a regional digital hub for cloud computing and its reputation as a promising destination for innovation-based technology investments in the region.

In line with the objectives of the plan, which consists of several stages for the development of data centers, the Ministry worked closely with a group of local and international companies to structure the basic business principles for the development of mega data centers in the Kingdom. The plan's goals are expected to surpass the 1,300-megawatt mark before 2030, with expected investments of over $18 billion in data centers and renewable energy serving the region.

The ministry had previously announced the start of work with three companies as the first phase, and four new companies were recently added as the plan’s second phase, namely Malaz Capital, Dawiyat Integrated Telecommunications & Information Technology Company, Quantum Switch Tamasuk Holding and Al-Fanar Group.

The Deputy Minister for Telecommunications and Infrastructure Eng. Bassam Al-Bassam, stressed the importance of empowering the ministry’s private sector partners and accelerating economic growth by increasing the attractive diversity of digital investments. “Today, the Ministry is directing the development and construction of mega data centers to increase the adoption and maturity of cloud-enabled services for digital services, games, e-sports, online broadcasting services, content service operators and other digital platforms and their localization. The Kingdom is steadily moving towards strengthening its position as a leading regional digital hub, through partnering with the companies operating in the sector, accelerating their pace of work and ensuring their readiness, in order to digitally empower this ambitious nation.”

“Based on our global experience in the field of advanced renewable energy applications, technology localization, and the provision and linking of digital solutions, the Ministry’s initiative comes at the heart of our direction and enables us to keep pace and achieve Saudi Vision 2030, to be the core of mega data centers in the region,” said Eng. Abdulsalam Mohammad Al-Mutlaq, Al-Fanar Group Chairman.

For his part, Dr. Abdulaziz Jazzar, the Managing Director of Malaz Capital, stated: “The Kingdom is witnessing an ambitious plan for digital transformation aimed at the citizen’s welfare and the country’s progress, pointing out that the mega data center development program is one of the most important pillars of this plan in which Malaz Capital cooperates with Ourjouwan company.”

Speaking on behalf of Dawiyat Integrated Company, CEO Dr. Ahmed Sindi, said: “Mega data centers are one of the most important enablers to realize Saudi Vision 2030 in the Kingdom’s digital transformation field. It is also a major enabler for the advancement of the Fourth Industrial Revolution technologies and contributes to the content localization and the provision of technology services according to the highest standards.”

Commenting on this partnership, Mr. Matthew Nathan, CEO of Tamasuk Holding and Board Member of Quantum Switch, said: “We are honored to nominate Tamasuk as a strategic partner for the Ministry of Communications and Information Technology to provide a new mega data center in the Kingdom. The company is fully prepared to support the Ministry of Communications and Information Technology’s vision plan for the Kingdom’s digital transformation, due to Tamasuk’s financial capacity and its experience in development.”

It is worth noting that the Kingdom has made great efforts to spur the development of digital infrastructure and enhance its role in connecting the world. It launched several national initiatives to connect more than 3.5 million homes with optic fiber, cover 70% of remote areas with wireless broadband networks, and launch the first neutral Internet Exchange Point (SAIX) in Saudi Arabia, which is considered the largest communications, IT and emerging technologies market in the region, with a value exceeding $35 billion, and where the three biggest telecommunications companies in the region operate.