“NEOM” Announces Collaboration with “Datavolt” to Build an AI-Powered Data Center Worth $5 Billion at “LEAP 2025” Conference in Saudi Arabia

During the ongoing “LEAP 2025” conference in Saudi Arabia, “NEOM” announced its partnership with the Saudi company “Datavolt” to build an AI-powered data center valued at $5 billion, with a total capacity of 1.5 gigawatts, according to the Saudi Press Agency.

This deal is the latest step in a series of large-scale investments the Kingdom is making in the data center sector, solidifying Saudi Arabia’s position as a global hub for this industry.

Global Interest in Saudi Arabia’s Data Center Sector

According to a report by “Twimbit” released in early 2024, Saudi Arabia had 22 active data centers by the end of 2023, with expectations to increase that number to 62 in the coming years.

The “LEAP 2025” conference also saw other announcements related to data centers in Saudi Arabia. In addition to NEOM’s announcement, the American company “ServiceNow” revealed plans to launch a number of data centers in the Kingdom by 2026. Similarly, “Zoom” announced its intention to build a processing node in the “Center3” data center in Saudi Arabia to enhance the performance of its platform in the region. Furthermore, “Microsoft” disclosed that it is nearing completion of data centers in three locations across the Kingdom, with services set to launch by 2026. Additionally, “Amazon” announced an investment of over $5.3 billion to build data centers in Saudi Arabia to boost its services in the region.

Saudi Arabia: An Ideal Environment for Data Centers

Data centers often face significant environmental challenges, such as high energy consumption and their impact on the surrounding natural environment. However, Saudi Arabia, with its desert climate and vast land area, provides an ideal environment for building data centers away from urban areas, thus minimizing their environmental impact. Moreover, the Kingdom has abundant energy resources, such as natural gas and petroleum, which makes it easier to generate the electricity needed to power these centers at a low cost compared to other countries.

Government Support and Extensive Incentives

Saudi Arabia aims to strengthen its economic position and diversify its revenue sources in line with its Vision 2030, with data centers being an integral part of this vision. The government has facilitated the establishment of these centers through new laws, such as the Personal Data Protection Law and the Cloud Computing Framework, along with tax reductions, low electricity prices, and easy access to large plots of land at competitive prices.

Saudi Arabia: A Gateway to Rising Demand for Data Centers

Thanks to its strategic geographical location, Saudi Arabia has direct access to the Red Sea through the city of Jeddah and surrounding areas, providing it with access to 15 diverse undersea internet cables. This enables companies to take advantage of these cables’ capabilities. With the government’s focus on digital growth and the expanding digital economy within the Kingdom, there is an increasing need for new data centers to meet the growing demand. According to “Roland Berger” consulting firm, spending and demand for artificial intelligence and cloud services are expected to grow at a rate exceeding 25% by 2030, a growth supported by the Kingdom’s data centers.

What Do Users Gain from Data Centers in Saudi Arabia?

Although the focus on data centers in Saudi Arabia may seem more commercial than beneficial to the average user, the impact on the daily internet experience and related services is evident. From faster access to websites hosted within these data centers to cloud services and platforms such as “Zoom” and “Microsoft,” the improvements will be significant.

Users will experience faster and more efficient services as companies announce their use of Saudi data centers, offering an enhanced user experience.

Source: Various websites