Businesses in the Middle East: leaders in business – what about tech?

There’s no denying that the Middle East is a global reference for rapid business growth – if change is a constant in the Arab world, then the businesses that are able to thrive there are organisations of remarkable agility and mettle

Saudi Arabia, Qatar and the UAE, for instance, are home to some of the biggest organisations in the Energy and Finance sectors, including the likes of Saudi Aramco, whose 2020 annual sales totalled $329.8 billion despite difficulties raised by the coronavirus outbreak and its impact on stock markets worldwide.

Leaders in business but not in tech

Nonetheless, when it comes to cloud computing, it seems that businesses based in the Middle East have yet a long way to go before catching up with their Western counterparts, with cloud spending in the region residing amongst the lowest on a global scale.

That’s partly due to a severe skills gap, where the demand for cloud technologies is higher than the supply of IT talent with cloud computing related expertise. 45% of organisations mention this shortage as a major challenge to cloud initiatives in the Gulf, according to IDC; naturally, having the right knowledge is essential to deliver a successful cloud migration and continued management.

Another factor fuelling the reluctance in cloud adoption in favour of on-site storage in the Middle East is the fact that legacy IT infrastructure counts for most of the region’s network architectures. These systems are often worth millions, and cannot simply be discarded, making over 36% of enterprises find it particularly challenging to move data, applications or other business elements to a cloud environment.

Security myths and privacy concerns are also a significant impediment to cloud adoption for Arab organisations, as they are several times more likely to fall victim to cybercrime. A February 2018 report from the Center for Strategic and International Studies and McAfee ranked the United Arab Emirates (UAE) as the second most targeted country in the world for cybercrime, costing the Emirate an estimated $1.4bn per year. In 2020, the same country reported an “at least 250% increase” in cyberattacks, as hackers took advantage of Covid-related digital adoption.

Current drivers to cloud adoption

Despite such barriers, it appears that companies in the Middle East can no longer ignore the benefits of cloud computing. The COVID-19 pandemic has shone a light on the importance of flexibility and agility in the modern business landscape, where those able to quickly adjust infrastructure, keep up with productivity and meet client demands – regardless of whether on-premise or remotely – possess unparalleled competitive advantage; cloud-first strategies enable businesses to move fast and deliver functionality that once would have taken months or even years to deploy.

5G, artificial intelligence and machine learning are also key current drivers to cloud adoption in the region, with businesses across the ME rapidly including these new technologies in their digital transformation plans. In fact, the UAE has even developed a National AI programme, having appointed the world’s first minister for AI to ensure further investment and utilisation of artificial intelligence.

The adoption of such technologies would simply not be possible at scale without cloud computing as the backbone, enabling large volumes of data to be processed incredibly quickly, on-demand.

The future is in the cloud

For these reasons, it’s no surprise that the Middle East data centre market is predicted to grow at a compound annual growth rate of around 7% up until 2024. It is also estimated that more than 70% of Middle East companies will have multi-cloud environments in place in the next two years.

Additionally, recent initiatives such as the government of Bahrain’s “cloud-first policy“, and national strategic visions including the UAE Vision 2021, Saudi Vision 2030 and New Kuwait Vision 2035 all reinforce how promising the cloud landscape in the ME region can – and most likely will – be in the foreseeable.

The Middle East has some way to go before unlocking the full potential of cloud computing technologies, but it’s safe to say that the region is on a steady path to rapid cloud growth in the coming years.

Increasing operational requirements are prompting businesses to migrate from on-premises, server room operations to cloud-based data centre services, regardless of current investments in IT infrastructures. Managed cloud providers can remove skills shortage concerns and take the pressure off internal technical teams by helping companies modernise their IT infrastructure, from initial design all the way through to migration and continued management. And, at the end of the day, the myth that the cloud is not as secure as on-premise infrastructure is exactly that – a myth. In reality, the data is likely to be better protected in a secure, certified data centre, rather than in the workplace where it could be vulnerable to human error or environmental accidents.

About the Author

Jon Lucas is co-director at Hyve Managed Hosting. We combine small team ethos with a passion for technology and support by providing fully managed, global cloud hosting services. As certified Google and Equinix partners, we are expertly positioned to power your success.

Featured image: ©Badahos