Oracle expands in Middle East with new cloud region in Abu Dhabi

Oracle opened a new cloud region – a complex that houses at least two data centres – in Abu Dhabi that provides storage capacity to regional enterprises amid soaring demand. This will be the second cloud region of the Austin, Texas-based company in the UAE and its third in the Middle East.

The UAE and Middle East are “priority regions” and the company has made “significant investments” to enhance its infrastructure, physical presence, human resources and other support capabilities in the region, Jae Sook Evans, Oracle’s chief information officer, told The National.

“This long-term commitment from Oracle has translated into massive investments to help organisations of all sizes achieve their digital transformation projects,” said Ms Evans, without disclosing the value of the investment.

The cloud industry is booming globally. The GCC's public cloud market is expected to more than double in value to reach $2.4 billion by 2024, up from $956 million last year, the International Data Corporation said.

For regional businesses, moving to a cloud system hosted by a specialised company – such as Oracle, Amazon Web Services or SAP – is more economical than creating their own infrastructure of servers, hardware and security networks, industry experts said. It also brings down the overall cost of ownership.

Businesses have realised the “numerous benefits including higher return on investment, ability to constantly innovate, boost security and create a scalable business model that is quick to respond to changing economic environment, a key priority post-Covid”, said Ms Evans.

Oracle, whose local clients include DP World, Abu Dhabi Customs, Emaar Properties, Saudi Arabia Tourism Development Fund, Saudi Railway Company, Mashreq Bank and Saudi Arabia Mining Company, reported nearly $7.4bn in global revenue from its cloud services and licence support business in the quarter that ended on August 31.

The cloud services business accounted for more than 75 per cent of its total sales of $9.7bn.

In July last year, the company opened its first cloud region in Jeddah that was followed by another centre in Dubai in October 2020. Last month, Oracle said it planned to open a second cloud region in Saudi Arabia's upcoming futuristic city Neom.

With the Dubai and Abu Dhabi cloud regions, Oracle has the required infrastructure to work with public as well as private organisations to accelerate their digital transformation, Richard Smith, Oracle’s executive vice president for technology in Europe, Middle East and Africa, said.

Dr Thani Al Zeyoudi, Minister of State for Foreign Trade, said the UAE is committed to developing an innovative and knowledge-based economy that “encourages the development and deployment of the technologies of the future and attracting human, financial and technological capital to the nation is central to these ambitions”,.

“Oracle’s continued investment into the UAE will only accelerate this process,” he said.

The company has 34 cloud regions globally and aims to open 10 new centres across Europe, the Middle East, Asia and Latin America over the next year.

Oracle’s cloud regions will boost the cyber resilience of the country, mitigate the incidents of cyber crime and increase international collaboration, Dr Mohamed Hamad Al Kuwaiti, head of the UAE government’s cyber security, said.

“Oracle’s two cloud regions in the UAE are important investments towards providing cyber resilience and secure digital infrastructure for organisations to enjoy the full benefits of cloud computing,” said Mr Al Kuwaiti.

Several global players are establishing data centres in the region as the cloud market picks up.

Last year, IBM unveiled two data centres in the UAE, its first foray in the Middle East and Africa cloud storage market. In 2019, Amazon Web Services opened three data centres in Bahrain. Germany's SAP has centres in Dubai, Riyadh and Dammam, which house servers for local cloud computing clients.

Alibaba Cloud – a comparatively smaller player and the cloud computing of the Chinese e-commerce giant – opened its first regional data centre in Dubai in 2016.