Market Trends of United Arab Emirates Data Center Storage Industry
IT and Telecom to Hold Significant Share
- The arrival of 5G promises a major increase in speeds, low latency, and unforeseen network capabilities. This paves the way for groundbreaking applications with real-time connectivity across everything.
- The rapidly increasing 4G penetration and the upcoming 5G wave are forcing telecom vendors to invest in the UAE data center market, leading to an increase in storage demand. According to the Telecommunications Regulatory Authority (UAE), in the United Arab Emirates, there were over 18.7 million active mobile phone subscribers as of March 2022.
- According to Ericsson Mobility, the country is expected to have over 80 million customers of the 5G initiative in MENA by 2025. This widespread use benefits companies and other technological advancements in the region and lays the groundwork for smart cities and worldwide communication. Furthermore, the UAE Telecom Authority set an ambitious objective of 100% 5G penetration in the country by 2025 to become the Middle East's technically prominent player in the networking system.
- 5G boasts nearly seven times faster throughput than 4G, reaching speeds of 10 Gbps compared to 1.45 Gbps. This leap complements the significant I/O throughput enabled by enterprise-grade technologies like NVMe and SSDs in servers and storage appliances. The increasing demand for NVMe in SSDs is expected to drive the market’s growth during the forecast period.
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All-Flash Storage to Hold Significant Growth
- There has been a rapid growth in flash drive revenues, with enterprise storage devices having the majority of annual growth per year. With the growth in data generated by the enterprise, coupled with the growing adoption of cloud technology, the UAE data center industry has begun to gain attractive investments from the IT sector. Medium-term growth in IT spending is driven by increased demand for software and services, particularly from large enterprises looking for solutions in the areas of cloud computing, data analytics, cybersecurity, and IoT.
- Key market players have entered strategic partnerships to accelerate their business using cloud technologies. In November 2022, G42 Cloud, a division of artificial intelligence company G42 in Abu Dhabi, and German software giant SAP signed an agreement to assist businesses in accelerating their digital transformation using cloud technology. As it portrays itself as a global innovation center, the United Arab Emirates has long championed the crucial role that digital transformation plays in its economy and culture.
- In the United Arab Emirates, the advent of the metaverse is anticipated to increase the demand for big data management and analysis rapidly, requiring the allocation of more resources by businesses that want to harness its potential. With big data and analytics, data access and processing patterns demand a higher storage performance, along with increased concurrency. The NVMe-based SSD is gaining traction in the market studied.
- Since major primary storage workloads will depend on flash storage, the demand for flash storage is projected to increase in the future. This is primarily supported by NVMe’s expansion within the storage industry as a high-performance protocol across storage systems, servers, and storage area network fabrics. With data protection stepping beyond backup and restore to focus on secondary storage datasets (backups, snapshots, and replicas) being leveraged for DevOps, analytics, and testing workloads, the trend acts as a catalyst for the market studied.
