How data centre outsourcing drives growth in the Middle East

In the Middle East as in the rest of the world, there has been a marked increase in the consumption of data, and in demand for data centre services. In response, the data centre market in the Middle East is expected to experience strong growth of 7% CAGR through 2024.

This growth is driven by increased demand due to the global pandemic, as well as smart city initiatives in key countries such as the UAE and Saudi Arabia.

However, growing a data centre infrastructure isn’t easy. Increasing cost of materials and equipment, construction, and labour all contribute to the expense of building new data centres and expanding the capacity of existing facilities.

Because of this, many businesses in the Middle East are turning to data centre outsourcing, to support economic growth in the region. Data centre outsourcing can help support economic growth through:

Resource efficiencies.

Outsourcing improves the efficiency of resources and processes. Hardware, infrastructure, and labour can all be consolidated to a single location that serves multiple enterprises, rather than spread out over several locations. Resources can then be channelled to high-value, strategic initiatives and innovation.

Skilled workforce.

The data centre is suffering from a shortage of skilled technical labour, which is expected to continue for the next several years. Research from Korn Ferry indicates that this could result in $15 billion in unrealized output in the UAE by 2030.

Outsourcing provides companies access to skilled labour to design, build, maintain and optimize data centres and contribute to overall growth.

Connectivity.

Business growth requires reliable, stable internet connections. Outsourcing allows companies to hold high uptime standards of up to 99.99 or even 99.999%. This uptime is supported by infrastructure redundancy, which allows for failovers and routing adjustments to minimize service interruptions.

Data centres also have backup power, usually in the form of diesel generators – although fuel cells are being considered as a more eco-friendly alternative.

Historically, the Middle East economies have been heavily dependent on oil. But a global movement toward environmentally-friendly solutions, such as renewable energy and electric vehicles, has led these countries to re-evaluate their priorities. Governments are prioritizing alternate businesses to diversify their economies. However, new businesses need data centres, and data services, to establish themselves and to be competitive.

As the Middle East becomes a more attractive investment for new businesses, particularly those in the technology field, this demand will only grow. But construction of privately-owned data centres is challenging and expensive. For these reasons, outsourcing data centre services can help to support growth in the Middle East.