Gulf data centers grow, and move to cloud

Continued expansion in the Gulf states, says DCD Intelligence report

22 December 2014 by Peter Judge - DCD

High growth is driving investment in data centers in the Gulf region - and the region is moving to outsoucing and the cloud, according to a new report.

Two thirds of the data states in the region are owned and operated in-house by governments and big enterprises, but this is set to change, according to Commercial Data Center Services in the Gulf (GCC) Region, a new report from Datacenter Dynamics Intelligence.  DCD Intelligence expects the average outsourcing penetration in the Gulf States to rise steadily, reaching 41 percent in 2019.

Gulf goes for growth
Gulf Cooperation Council (GCC) nations - Saudi Arabia, the United Arab Emirates (UAE), Qatar, Bahrain, Kuwait and Oman - are diverse but share a lot of feaures.

Among other things, their governments are striving to develop businesses other than the region's traditional strength in oil-related industries.

Data centers in the Gulf region are predicted to draw a collective 465MW by 2019, and during that time the mix will shift considerably from in-house IT towards outsourced resources, colocation and cloud services.

The oil-rich region has never had any shortage of power in the past, so data centers have been shielded from pressures towards efficiency, but but there are predictions that power price rise. As well as promoting more efficient data centers, this is also promoting the drive towards colocation spaces and managed service providers.

Data processing in the area will get a small but significant boost from major global events coming to the region including the 2022 FIFA World Cup in Qatar and Expo 2020 in Dubai.

The DCDi report analyzes the key trends and major developments shaping the market for commercial data center services in these countries,examining the leading service providers in each country, with a focus on their business models and strategies.

"With the market for colocation and managed services already becoming more diverse and competitive, we expect the use of third-party facilities to grow at a faster pace than in-house construction and expansion initiatives," says the report. "In some markets, competition has the potential to put downward pressure on pricing, further helping to stimulate the market for outsourcing services."

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