The Gulf Region, AI Growth and the Future of Middle East Data Centres | Live at Datacloud Global Congress 2026

In the fourth episode of our series recorded live at Datacloud Global Congress 2026 in Cannes, Andy Davis is once again joined by co-host Rory Flashman from Spa Communications to explore the rapid growth of the Gulf region as a major data centre market. 

Joining the conversation: 

Simon Young, Google 

Stephen Beard, Knight Frank 

Together, they discuss why the Middle East has become one of the most talked-about regions in digital infrastructure, and how government ambition, sovereign wealth, power availability and AI demand are helping to accelerate growth across the market. 

The conversation explores the role of the UAE, Saudi Arabia, Israel, Qatar, Kuwait and Oman in the region’s data centre development, as well as the opportunities and challenges that come with building at scale in a fast-moving market. 

Simon and Stephen also discuss the importance of leadership and long-term vision across the GCC, the impact of major AI initiatives, and why the region could become an increasingly important bridge between Europe, Asia and Africa. 

The episode also looks at how international operators and Middle Eastern developers are approaching expansion, the role of sovereign wealth funds, and what other markets, including the UK, could learn from the region’s ability to move quickly and reduce barriers to development. 

Recorded live at Datacloud Global Congress 2026 in Cannes. 

Key Topics: 

Why the Gulf region has become a major data centre growth market 

How government leadership and national AI strategies are driving investment 

The role of the UAE, Saudi Arabia and Israel as leading regional hubs 

Why power cost and availability are central to the region’s opportunity 

The potential for AI infrastructure growth in Kuwait, Oman and other emerging Gulf markets 

Why fibre connectivity and international transit remain important challenges 

How data centre design in the Middle East compares with Europe 

The impact of geopolitical uncertainty on investment decisions 

Why international operators are looking more closely at the region 

How Middle Eastern developers and sovereign wealth funds are expanding globally 

What the UK and other mature markets could learn from the Gulf’s speed of execution 

Why talent development and local workforce initiatives will be critical to long-term growth 

How AI adoption is changing the wider data centre and digital infrastructure conversation 

Tune in for an insightful conversation on how the Gulf region is positioning itself at the centre of the next wave of data centre and AI infrastructure growth, and why speed, capital, power and policy will all play a major role in shaping its future. 

Transcript

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SPEAKER_01 0:00

The data center industry is moving faster than ever, and behind the scenes, some seriously smart people are making it all happen. Welcome to the Inside Data Center podcast, where we dive into the stories, insights, and innovations driving real change across the industry. From hyperscale campuses to game-changing technologies, we're talking to the people shaping the future of digital infrastructure. Whether you live and breathe data centers or just want to understand what's powering our connected world, you're in the right place.

SPEAKER_00 0:26

We are back, back on the Global Commissioning Networking Terrace at Data Cloud. Managed to get that one in again. It's good a good start. So today we are being joined by Stephen Beard from Night Frank and uh Some Young from Google. Thanks for coming speak with us. We're going to talk about the Gulf region. Before we get into Gulf. Maybe a bit of both. Given that you've just won. Wow, we didn't win. We won a record prize. Oh, okay. Well, still a week. We're getting to a bit of both. And uh, but before we kick off, maybe if we if we start with you, Simon, just a quick introduction to you and your role.

SPEAKER_04 0:59

Yeah, yeah, sure. So so Simon Young, I've been in the industry longer than I care to remember or imagine. So I uh lead a team in the Middle East and Africa for Google, which is part of the center investment and development and specifically acquisition and development. So uh my team are responsible for how we acquire the data center capacity that Google needs today and uh what it does know it needs for the future. So we cover everything from Israel, Turkey, the GCC, also South Africa and some emerging markets have it. Thank you.

SPEAKER_03 1:33

Steve. Uh yeah, Steve Beard, global head of data centers uh at Night Frank. Uh in is in the name, we're a big advisor uh to customers, developers, operators, uh, and institutional capital. So we've got four satellite offices around the world in London, Singapore, Dubai, uh, and California. So I moved across to the region about about three years ago now. So nice. Thank you.

SPEAKER_00 1:55

So let's talk about the region in general. New hubs blowing up all over the place. Literally, everyone's talking about the Nordics, people talking about the Middle East. What is it about the Middle East region that's made it, or why has it become a major data center hub?

SPEAKER_03 2:11

I'll go. I I'll go on and I'll my view personally is that I kind of um I went there three years ago, not because I like playing golf uh or paying tax or not paying tax. It is because, you know, when you look back, say over the last 10 years and you look at kind of the supply and demand imbalance, there was a clear and obvious uh lack of new supply uh across the region. And at the same time, with the the scale of growth, I mean you're looking at your total cost of occupation as a customer, obviously the cost of power, it's obviously a very pertinent subject. I'm sure over the over this week, it was obvious that that market, that region needed to grow and grow quickly. And the final thing I say on that is that coming from Europe, I can say this, that there is no bureaucracy, yeah, right, to the same extent. Like when when when they say go, they go. Um, and that's been a fascinating thing to see since I was there.

SPEAKER_04 3:03

So I think from her perspective, looking at it objectively, I mean, I've been in the region a little bit longer than Steve. Fun to five years I've been basing Dubai. A lot of it comes down to leadership at government level. And actually, if you if you look at how Dubai or the UE itself has developed over the last 20 years, the vision that the leadership have is uh is fantastic. So I think they've saw or they've explored an opportunity in the market where they're not so reliant on tourism or oil and gas, um, but and are really seeing they've got a huge appetite to be a major player in this in this sector. And I think that's that's very clear with the announcement of organizations like G42, um for like Humane, uh like QAI now in Qatar as well. So I think the there's a there's a real vision from the leadership of the GCC countries that's that's really helped this emergence of a of a data center booth. And just to echo Steve's point, obviously I've spent some time in APAC as well. And there was that sort of missing connection point between uh what we see in Flat D in Europe, what we see in APAC. So sort of seeing a sort of emergence point of of the Middle East, which uh speak to our Saudi friends is the is the middle of the world from anywhere, you know, it's um it's central to liberty. So I think that's why we're seeing a major sort of boom at the moment in the sector.

SPEAKER_02 4:23

And are you seeing like like we're seeing in Europe and say like the evolution of data centers as well, like this the scale, you know, the type of facility that's being developed now, it's all evolving. Is it the same in in your region? Are you seeing uh is it all significant scale facilities that they're developing, or are we also seeing like inference regional, yeah? We see you see what's in the news, don't you? But what's really happening in the region?

SPEAKER_03 4:46

Yeah, I'd say like the the catalyst really for, I don't know, let's start with the the UAE, for example, was see Microsoft comes to the market, comes to the market at scale. You know, prior to that, Oracle had opened up their regions in in Saudi to start with. Um, but they they're very relative and similar to those same facility deployments in in Europe. Um, so they're maybe in those six, ten, twelve megawatts. If you look at what's under construction at the moment, it is exactly the same, right? It's it's it's huge. On the AI front, obviously, I think everyone well knows about the Stargate scheme over in Abu Dhabi. Um, but one interesting component that we haven't yet seen, uh, which is quite telling, we haven't seen the arrival in depth of the neo clouds yet, which I think is quite surprising because obviously when you look at that total cost of power again, we are definitely comparative to the Nordic. So I think that's a huge opportunity for our region in particular going forward.

SPEAKER_04 5:34

Yeah, I think one of the things we need to work on a little bit is is um sort of the broader interconnecting fiber infrastructure as well. Um, it can be quite cost prohibitive as we sort of compare it to some of the more mature markets. There's obviously maybe only one or two providers in certain certain countries, whereas there's an abundance in other another regions. So that's something that we need to take into consideration.

SPEAKER_02 5:57

Do you think the near cloud will come? Is it or and will it be uh country specific or will it be a regional move?

SPEAKER_04 6:05

So I I personally, in the short term, I think it will be country specific because of geopolitical issues and tensions and challenges that we're currently faces, and hopefully those all get included very soon for everybody's sake. Um but then there has to be an element of of confidence or re-emergence of confidence in the region to look at significant investment and given everything that's going on in the last 12 weeks or so. Sure.

SPEAKER_02 6:34

And do you feel and and the design of data centres as well? We've kind of talked about it. Is it is it different in the region or are you uh it's very hot, is one way of looking at it. But you know, is it a different type of data centers being constructed as well? And these are questions that people ask me, that's what I'm trying to know there. Like, are you developing different facilities? Is a facility that you build in uh Dubai, I mean that would be different to if if you're building a facility in Frankfurt?

SPEAKER_04 6:57

Um fundamentally, no. I think there's from an engineering perspective, there's challenges around the environment, i.e., heat, as you mentioned, the the sort of arid temperatures, humidity. So we we're never gonna be blessed with the PUREs of the Nordics, which is something that we have to work with. But but fundamentally, the the design methodology that's that's been utilised is is is no is no different. I think that uh we it's hard to say today, but we may see a bit of a change in sort of construction methodology or or or design methodologies around uh protection from ballistics, etc. That may be a change given what we may have heard or seen in the press with with AWS and Bahrain and uh and and the UE. So that that might you might see a slight change there. Um and obviously we're well versed with our colleagues and friends and um across different regions and in Israel they they seem to have done uh a very good job of altering fitting those types of designs and methodologies to be just that's bad news then in terms of the rents, because no doubt the costs will start going through the roof. So let's hope not. Let's hope not, Steve.

SPEAKER_02 8:02

Do you think you'll see international developers move into the region? Because that's another aspect. Obviously, you've got the regional players uh you know are in the region, but do you think you will see US developers or European developers enter the region?

SPEAKER_04 8:16

Yes. And I think you will also see Middle Eastern developers want to go international. Yeah, that's probably a question for you, Steve. Sorry.

SPEAKER_03 8:23

Yeah, you sort of those those types of questions you're always thinking, which which NDAs are in place and which aren't? But um, I think fundamentally it's well known that yeah, uh there are two or three of the of the largest uh data center operators globally, obviously Economics have been there for some time already in the UAE. Um, I'm sure they've got aspirations to get into the likes of Saudi because they need to obviously uh build out that ecosystem. But yeah, I'd say in the next three months you'll see some announcements on the part of three big US and international operators. And to Simon's point, obviously, you know, Kazna are probably the biggest brand in the UAE at the moment, and they're gonna continue to grow at scale throughout Europe. I think they've seen some big announcements in France and and and in Italy. So that again is another interesting component on the capital. You know, you've got to remember that some of the largest sovereign wealth funds in the world sit in Abu Dhabi. Yeah, right. And so those guys are desperately keen to enhance their exposure to data centers and investing into the platform and the opco. And obviously their return on investment is less than an institutional private equity. So my money is on those guys that are backed by sovereign wealth to really drive the agenda.

SPEAKER_02 9:23

And you've seen that move, haven't you, into some of the lot, a lot, some significant investments from the region into platforms outside the region.

SPEAKER_04 9:29

And we'll see inward investment as well. I think I think there'll be uh you can watch the press, and if you haven't got boots on the ground there, we're we're always pleased when we see the the sort of top dignitaries of the of the countries announcing sort of agentic AI through the whole government initiatives in the next three years. That that need that to do that needs the backbone of the infrastructure and solutions and products.

SPEAKER_03 9:50

Yeah, it's funny actually, because it's a good point because obviously it's the comparison. Obviously, you guys are British based and and you're getting all those questions. And I think what the UK is trying to do, you know, with with the with the AI growth zone thing, right? It's like, hey, it's a really nice concept, but what does that actually mean? Like, what are you gonna bring down your power costs? Are you gonna have a look at taxation? Are you gonna look at nuclear power, alternative power? No, of course, well, you're looking at them, but how long is it gonna take you to pass those laws? By which point the likes of the UAE and Saudi are already building out gigawatt facilities. The Nordics have all got to get up power there. So I think you can take lessons. The benefit of being an emerging market, and I don't like to call our the region emerging, it probably is in comparison to the US and Western Europe, but one of the biggest benefits is that you can learn from lessons of other markets, and I think that's yeah, definitely to our to our benefit at the moment over there.

SPEAKER_04 10:36

And I think we see challenges, you know, um when we're looking at self-developed sites, which are which are large-scale sites. You know, the the bureaucracy or the or the amount of the amount of time dedicated from different parts of our organization, whether that's economic development, whether it's community initiatives, whether it's public policy and um and all those sorts of organizations to help bring a data center to fruition in sort of the European markets is uh is intense. Yeah and it's long as well. Um I'm not saying we're the the fastest in the Middle East, but there's certainly less obstacles to overcome to get authority approval and support, especially when we're also looking at uh how do we give back to the community? We've just sat in a Middle East leadership conference when we spoke about resource constraints. One of the biggest resource constraints that we have in the Middle East region is talent. So from a hyperscalers perspective, be it Google, be it you know Microsoft or AWS, it's how do we help the communities also develop, you know, bring their population to into this sector from an operational perspective, from a construction perspective, from a design perspective, of a huge amount of community initiative to help bring these to fruition.

SPEAKER_02 11:47

Yeah, I remember talking to somebody about Bahrain a while about how I think it's like 50% of their engineers are female. So and they're like really pushing into the right industry, yeah, they're looking at the industries of the future and trying to develop the workforce for the future, whereas in in the UK, for example, it's it's definitely not doing that. But is there a real drive then to create that workforce in obviously you've got to hire in, you know, people like yourselves, come from out of the region with experience, but there's a real drive to create the talent internally.

SPEAKER_04 12:15

Yeah, there is, and there's also even in the Saudi and the UE, there's the Saudi Saudi policy, MR MRIzation policies as well, where you where they're trying to bring the sort of workforce through as well. So I think those are super good initiatives that we we try and support as best we can.

SPEAKER_03 12:30

And again, it's public sector lev, right? So it's not it's not a it's not a question of uh do this if you'd like to do it, you've got to do it. Yeah, it's over obviously in Europe, but it's not that way. So it definitely helps. No, no, well, it certainly helps.

SPEAKER_00 12:41

It certainly helps. I sit on the Tech UK Data Centre Council, so I get to hear a lot of kind of the inside track and the concept is phenomenal, but the execution needs some work, especially around to your point, Stevens and all power pricing, you know, uh energy availability, all of those things.

SPEAKER_03 12:56

No, no, and and I get the government's agenda right in terms of leveling up, right? Hence why the AI growth centers are going over to Scotland and elsewhere. But the needs to recognise that, and again, this is something I keep getting frustrated, even at this industry event, is that everyone's talking about AI, AI, AI, right? It's like one second, that's one component of our sector. Like at the moment, every single thing we use on a day-to-day basis is cloud. Okay, so right now in London, if you're using that as a reference point, we have zero supply for capacity in London. So, yeah, it's great giving AI capacity up in Scotland or Manchester or wherever it may be, but you need to deal with the here and now. And and ultimately, in order to retain its position as the second largest data centre market in the world, if it's not going to give the likes of Google and other other guys capacity, then they'll have to take it elsewhere. So it is a it is a massive giant, I'm sure. Yeah, yeah.

SPEAKER_04 13:42

And I think um you may have touched on that on a previous conference where, but if the UK don't do something now, they'll be left behind. It's too late. Is it too late? Yeah, no, it really is.

SPEAKER_00 13:51

I think the UK knows that as well. There are a lot of operators trying to kind of lead the charge and we're very close to the government. But to your point about bureaucracy, I think there's some lessons that the government could learn from the Middle East, like move faster, like literally move much, much faster, or as you say, miss the opportunity.

SPEAKER_04 14:06

And there'd be a huge appetite as well from the from the Middle Eastern community and the sovereign wealth funds over there to inward invest into the UK if it's a viable opportunity. So why not have those discussions and and and sort of um embrace it to an extent?

SPEAKER_03 14:19

Yeah, I mean, listen, it's it's still an unbelievably positive market at the UK, right? You don't always want to put a damner on it. And if you look at some of the occupational deals that are being done between cloud and AI over the course of the last six months, it's a fantastic story. But I think unless it sorts out that power situation, it is going to be left behind it.

SPEAKER_00 14:34

Yeah. That's a good point. So you were talking about Israel as well earlier, Steve, and it being kind of the biggest market in the Middle East. Are there other kind of major clusters, hubs popping up all over the place?

SPEAKER_03 14:45

Yeah, well, the top three right now. Israel is number one right now, UAE is number two, uh, and then and then Saudi is is is number three. The the big question when it comes to AI, and you can probably touch on this more than I can, but is if if we're if we're being crude, I'm just taking it down to let's say data privacy laws, which is another uh big big consideration, but if we're being crude on the power cost and the power cost alone, then you can't ignore the likes of Kuwait, right? Kuwait's power cost I think is running to a sub-five dollar cents per kilowatt hour. Oman is like six dollar cents per kilowatt hour. So from an AI perspective, if they get the policy right, if they look to the US and say is there other ways that we can make these American companies more comfortable, I think you could see a real explosion of AI in those smaller hubs with Saudi and the UAE acting as those big cloud superpowers.

SPEAKER_04 15:30

And we need to look at sort of international transit as well on networks, because it can be quite cost prohibitive and cost of networks is is extremely high in Pen. Even our home internet or what we have is is probably the highest in the world. I don't know.

SPEAKER_03 15:47

Well, probably because you're watching Arsenal, every opportunity off. We are champions to give a man.

SPEAKER_04 15:52

So yeah, but I think that you have to take that into consideration. So when we are doing sort of evaluations across markets of where we put our sort of free fungible demand, when we're considering all the options for that, if we've got a shortfall or we have to provide capacity somewhere, if we're not on a parity level, some of the more mature Flap D or North American markets, it's a non-startu. We're just not going to deploy it because it's it's not good for our business.

SPEAKER_02 16:18

I can't believe we've had the second Arsenal drop in and an Arsenal fan.

SPEAKER_00 16:24

I'm derighted, it's so good.

SPEAKER_02 16:25

I'm very Champions League, guys.

SPEAKER_03 16:27

I'm sure you'll get a little opportunity, guys. Fingers crossed we're around as long as we didn't bottle it.

SPEAKER_02 16:34

Well, I'm a Sohampton fan, so I can't really talk about it. Yeah, exactly. Um, final question, we just talk a bit about the event. Obviously, you you both may have been in the industry a while, and I think events are a great place to see how this industry's evolved. I think we're all in it day to day, you kind of forget, and then you turn up to these events, and it's twice the size as it was last year, and there's loads of people you you may not know or new faces as well. But what's your key highlight from the event? What are you looking forward to over the next 24-48 hours?

SPEAKER_04 17:03

So, look, we're not at the event because of the volume of sort of interactions we have to get through. So we're off site. But to come in and spend a couple of hours here this morning and see how it continues to grow. You know, I I was going to the monocle events, how that was, how it's going here every year it can, and how actually the the external events outside it, not just the networking part, but the sort of health and well-being part of it as well, around sort of cycle events or yoga or or the golf day, which actually you know is something that we should talk about, is for charity. Um, Cahil for Moy does an excellent job. It's for suicide prevention in the construction sector. So I just want to give that a bit of a shameless plug. And uh it's huge. We'll generate the PTC event where he holds it, and and here it's generated over like 100,000 euros in in charity.

SPEAKER_03 17:50

So which is actually just that this morning doing sound.

SPEAKER_04 17:52

Oh, yeah. So um, so yeah, so I think all of those components around the event are actually what's making it even more sort of exceptional rather than just the conference and people speaking on sort of stage and the same sort of topics over and over again. I think that it's really bringing the community together.

SPEAKER_03 18:11

I think from my side on the commercials, I'm at the opposite end of the scale, right? I've got to come into the conference and meet everyone I possibly can. Um, but for me, what I love about the sector is the change, right? And and so last year, let's be honest about it, everyone was everyone was really negative. Microsoft have walked away, that's it. Industry's gone. Oh god, what other industries can we move into now? AI a bubble. 12 months later, by God are they back? Yeah, as is everybody else. And so that just breathes real genuine positivity. It's a complete change of heart this year.

SPEAKER_04 18:39

So that's so, but even in the last um four or five months, yeah. We on February 9th at Capacity Middle East, we had the Middle East Leadership Summit. There in that there was a question about is AI a bubble? Yeah, and it was quite a high percentage that were like, yes, just four months, even with the issues we're facing in the Middle East, that's reduced significantly to a single-digit percentage of the AI above. So I think here to embrace it, and there's a couple of chats that I'd done in the Middle East where I've asked the audience, you know, who uses AI on a day-to-day basis, not to create Arsenal memes or nanobanana or nanobanana or Gemini, chamberless plan for Gemini, um, or cat videos, who actually uses it in the day-to-day. And I can tell you now from from the sort of last 12 months working in Google, the the the development of AI in the platforms we use on a day-to-day basis from 12 months ago till today, night and day. So if you're not using AI to benefit, not saying your kids should use it for exams or anything, but if you're not using it on your day-to-day to be more efficient, to bring more sort of efficiency to what you're doing, to check that the guys that you deal with or the girls that you deal with on a day-to-day basis in the supply chain are not pulling the rule over your eyes. Just getting a second view on things, it's please embrace it. Whether it says Claude, Brock, that's here to say.

SPEAKER_03 20:01

It is here to stay, but let's be honest, not everyone's gonna win, right? And there are gonna be some very, very heavy losers. Yeah, that's why it's a gold rush right now, all right? Everyone desperate to get in and deploy. But you guys will be alright, because you you cover the whole stack probably, but there are others that don't. So I'm not just saying it's because you're here, probably, but my money on these guys would be one of the winners.

SPEAKER_01 20:17

Yeah, similar looks.

SPEAKER_04 20:19

And and maybe that's why we don't see us taking the much larger scale capacities in you know, outside of our self-builds, because we are we're we're in it for a long-term gain. Yeah, it's not a sort of in and out quick win, 12 months deal for us. It is and it's a full tech stack, as as um as Steve says, whether that's uh submarine infrastructure, whether it's sort of beta center infrastructure, or whether it's sort of platforms that you use on a day-to-day basis, you know, your YouTube's example, we cover that whole style. And um, we're such a we're such a large organization, and sometimes you just have to take a sort of sit back and and look at actually what drives a business, what drives revenue, and to see that we're it's in the public domain and go and see sort of the the backlog that we have of requirements on cloud services, it's at 480 billion or something crazy in sort of backlog that just shows you cloud services. Yeah, it shows you all the outro. It's it's it's the full it's the full stack. So um, and that's all super positive to the industry and for the supply chain and for everybody that's involved in it, whether that's job creation, whether it's transactional deals, whether it's data center construction, whether it's services to our client, it's just a huge sort of positive spinning.

SPEAKER_02 21:29

Yeah, and you see so many so many more suppliers now. The ecosystem is so different.

SPEAKER_03 21:34

You you walk through the and look at the stands, and there's companies you might not have heard of, whereas previously you've just all you know, you you always made this point about how opaque the sector's been and you and your frustrations like that. Same faces, but yeah, true, but it is becoming more transparent. Same faces, we're all getting a bit greier. People are being a bit more open, like that. Yeah, even like the like sort of the hyperscale is generally more engaging at one point. They're like, we're not engaging with anybody at all. But I think they recognize the need if we're really going to drive this as a community-driven type of sector, it needs more transparency and relationships. And it still is relationship driven, yeah, even though everyone thinks it's all autonomous, it's still based on relationship, which is good news for all of us. And that's the one thing. Unless your agent gets on with my agent, perhaps. Who knows?

SPEAKER_04 22:10

That's um your point, that's the one thing about AI that won't have that. They won't have the relationship. For sure. It won't ring me and say, How's your fam? Fitz alright. Can you guarantee that?

SPEAKER_03 22:19

I hope that is the case. Can guarantee anything. That's what that's my own personal fingers crossed.

SPEAKER_02 22:25

Well, we'll we'll end on that. Thanks both for your time. Well, it's been great. Interesting region, and everyone wants to learn more, so I appreciate you shedding some light on it.

SPEAKER_01 22:32

That's it for this episode of the Inside Data Centre Podcast. Thanks for tuning in. This show is brought to you by Data X and Data Exec, the recruitment partners powering global talent across the data centre and digital infrastructure world. If you enjoyed today's conversations, don't forget to follow, like, and subscribe. It really helps us grow the podcast community. Stay tuned for more stories, insights, and conversations with the people shaping the future of our industry.