Insights: The future of cloud adoption in the Middle East

The imperative for adopting cloud technologies has become increasingly evident in today’s rapidly evolving business context, driven by factors including remote working, enhanced data analysis and cybersecurity, and the need to create more efficient and resilient supply chains.

We have moved beyond the stage where cloud adoption is merely advantageous – it is now essential for businesses as they navigate the modern digital economy.

In the Middle East, nearly 68 per cent of companies surveyed within our EMEA Cloud Business Survey 2023 said that they plan to migrate most of their operations to the cloud within the next two years.

Cloud adoption on the rise

However, there are also more specific reasons why the region is quickly warming up to cloud solutions.
Countries in the Middle East have set out strategic national visions, such as Saudi Vision 2030 and the UAE Centennial 2071, which define specific goals for technological advancement.

Cloud services play a pivotal role in achieving these targets, helping organisations streamline operations, improve efficiency and spark innovation.

Additionally, the region is pioneering the development of smart cities within its giga-projects, leveraging cloud technology to underpin smart infrastructure. This includes initiatives aimed at enhancing public services, implementing intelligent traffic management and promoting enhanced connectivity.

Across the region, governments, and organisations in sectors such as healthcare and education are digitising to improve and create smart services. For example, Saudi Arabia has targeted to digitise 70 per cent of patient activities by 2030 to reduce human dependence and to automate many healthcare services. The cloud is an essential element and accelerator to achieve these objectives, to create centralised access to information.
Saudi Arabia and the UAE are also leading the pack when it comes to introducing legislations that require certain categories of data to be stored within national borders.

Local data centres, powered by the cloud, help companies meet their compliance obligations.

Hyperscalers (large cloud service providers) are capitalising on this development by launching cloud data centres across the region.

The top three global cloud providers (Azure, AWS and GCP) are set to have their presence in Saudi Arabia with Google Cloud launching its Saudi Arabia Region in 2023 and Microsoft and AWS announcing their plans to invest in the Saudi cloud data centre region over the next couple of years.

Cloud adoption: The next stage of growth

Some would argue that this is only the beginning. By 2028, the global cloud market is expected to be valued at $1.266tn, compared to $626.46bn in 2023.

Organisations in the Middle East are finding more and more innovative ways of using cloud technology.

Our research has found that around 90 per cent of companies in the region have moved beyond the “lift and shift” strategy of moving existing applications to the cloud and are now modernising their applications and/or creating new, cloud-native solutions.

For instance, organisations are beginning to diversify their cloud portfolios, using multiple providers and combining on-premises infrastructure with public and private clouds. This allows them to optimise performance and security in a cost-efficient way.

Another trend is the evolution of the one-size-fits-all cloud approach into a more tailored approach as specialised digital ecosystems begin to emerge, catering to the unique needs and regulatory requirements of sectors, including healthcare, finance and manufacturing.

Edge computing, which moves computer storage and processing to the edge of the network as close as possible to data sources, is playing an increasingly pivotal role in hybrid cloud adoption as the Internet of Things (IoT) proliferates. Cloud providers are further expected to offer quantum computing services that will give businesses access to unprecedented computational power.

The use of cloud-native tools, DevSecOps, microservices and serverless computing adoption will increase to allow developers to focus solely on code creation, reducing operational overheads and enhancing agility. This is expected to become the preferred model for deploying lightweight applications on the cloud, encouraging rapid innovation.

There is also the advent of emerging technologies, such as artificial intelligence (AI) and machine learning (ML), blockchain and the metaverse. Cloud providers are already offering AI and ML services, but the scalability and accessibility of cloud platforms make them ideal for deploying large-scale AI and ML workloads, which will redefine business operations. Meanwhile, cloud platforms will allow businesses to better implement secure and transparent de-centralised blockchain solutions.

New technologies to drive cloud adoption

Finally, the convergence of the metaverse and digital twin technologies, powered by cloud computing, holds immense promise for transforming the way we interact with virtual environments and replicate physical spaces in the digital realm.

These trends signify a paradigm shift in how businesses across the Middle East use cloud technology and solutions to drive growth and stay competitive in a rapidly changing world. The cloud promises to reshape industries and redefine the possibilities of the digital age. Our precise journey to the cloud will be dictated by technological advancement, regulation, and strategic imperatives, but the future promises to be one of innovation, scalability and agility.

The writer is the director – Cloud & Digital Infrastructure at PwC Middle East.