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Oman data centre market seen growing to $428mn by 2028

8 May 2023 By GULAM ALI KHAN

Muscat – The size of Oman’s data centre market was valued at US$247mn in 2022 and is expected to reach US$428mn by 2028, growing at a compound annual growth rate (CAGR) of 9.6 per cent over the next six years, according to a new research report.

The sultanate’s data centre market is being driven by a rise in cloud service adoption, significant growth in digitisation, increasing submarine cable connectivity, and the adoption of technologies such as big data, IoT, and artificial intelligence.

The increasing demand for migration to cloud platforms by various sectors is attracting local and global cloud service providers in Oman’s data centre market. For instance, global cloud service operators such as AWS, Microsoft, Oracle, and Google have a presence with local operators in Oman, according to the report released by Arizton Advisory and Intelligence, a global cloud and data centre advisory firm.

‘The Oman data centre market size will witness investments of US$428mn by 2028, growing at a CAGR of 9.6 per cent during the forecast period. Oman is among the major digital hubs, driven by government digitisation initiatives, cloud-based services, the adoption of advanced technologies such as big data IoT and AI, and robust submarine cable connectivity,’ Arizton said.

According to the report, Oman’s on-premises data centre is increasing, and government entities are migrating their workloads to third-party colocation data centres.

Arizton identified seven existing data centres and five upcoming data centres in Oman. The Oman data centre market has the presence of several local and global operators, such as Equinix, Ooredoo, Datamount, Cloud Acropolis, and Oman Data Park.

‘The prominent growth potential of the industry has also attracted several new entrants; for instance, Gulf Data Hub is expanding its footprint across the Middle Eastern region, where the company also has two pipeline projects in Oman,’ Arizton said.

It noted that Muscat is the primary location for developing data centre facilities in the country. ‘In 2022, other cities such as Barka, Salalah, and Sohar have also witnessed three data centre investments from Ooredoo. Additionally, Equinix partnered with Omantel to invest in a facility in Salalah.’

According to the report, Oman’s data centre market has the presence of global and local construction contractors such as DC Pro Engineering, Direct Services, Turner & Townend, AECOM, and Hill International, which are involved in developing data centre facilities in the country.

‘Government entities and private and public companies are taking initiatives to educate people and upgrade their data centre skill set in Oman. Microsoft’s ecosystem is expected to create over 15,000 jobs across the sultanate by 2024,’ Arizton added.

The report cited the Omani government’s targets to increase the digital economy’s contribution to around 10 per cent of the total GDP and the contribution from information technology to around 35 per cent by 2040.

In December 2022, the Ministry of Transport, Communications and Information Technology (MTCIT) in Oman signed a memorandum of understanding (MoU) with Amazon Web Services (AWS) for the launch of cloud service data centres in the country.

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