Local Business

UAE cloud service market set to cross Dh1b

Waheed Abbas/Dubai
Filed on September 21, 2017
UAE cloud service market set to cross Dh1b


The UAE cloud service market is projected to cross Dh1 billion by 2020 with increased adoption of cloud by financial services, hospitality, media and entertainment, oil and gas and retail sectors, according to analyst and industry executive.

Haritha Ramachandran, associate director, Digital Transformation, Frost & Sullivan, told Khaleej Times in an interview that the UAE cloud services market is forecasted to be $290 million (Dh1.06 billion) in 2020 - driven by several initiatives ranging from the shift from capital expenditure to operational expenditure, the need to scale for small and medium businesses (SMBs) and most importantly the digital transformation agenda.

"The hybrid cloud market has massive opportunity driven by the small and medium businesses. Here, partnering with the telcos and staying compliant with the data residency requirements will be a critical success factor. Integration and capability to provide additional security protocols is key to success," Ramachandran said.

Although ahead of other GCC countries, the cloud market in the UAE is still nascent and is in its early stages of adoption cycle.

Vinod Krishnan, head of the Middle East at Amazon Web Services, said there are number of sectors that are benefitting from cloud computing from startups through to enterprises and government institutions.

"Cloud adoption presents several benefits for organisations of all sizes, including increased speed and agility to scale as per organisational requirements, increased security, and reduction of capital expenses. The driving factors behind these benefits can be summarised with five key characteristics: No capital expenditure, pay only for what you use, elastic capacity, speed and agility of deployment and the ability to focus on your core competence," Krishnan added.

Apart from transport, the UAE is seeing great adoption of cloud in financial services, hospitality, media and entertainment, oil and gas, retail, and many more sectors.

"Another sector where we see increasing growth, and a lot of potential, is within public sector and government. Regional and local governments in the Middle East are embracing innovation and developing new ways for engaging and serving citizens. This has led to increased investments in cloud technologies," Krishnan said, adding that government sectors from education to social services are actively moving to the cloud to transform the way they deliver services and interact with citizens. For government entities in the UAE, this translates into more opportunities to deliver secure, reliable, and scalable solutions.

The UAE has relatively strong competition from local providers. In addition to IT providers, the telcos also offer cloud services as a part of their enterprise services and leverage their network and data centres to do so. In terms of the international players, they are competing in the market but they have a greater presence in small and medium businesss, whereas the local players and telcos have greater presence amongst the enterprise segment.

Haritha Ramachandran said infrastructure, for the most part has already been invested in by the local telecom players and many international players - now the key is to monetise it. Given organisations have just started to migrate to the cloud, she projected that will be about 5-6 per cent in the UAE. - waheedabbas@khaleejtimes.com


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