Saudi Arabia Data Center Colocation Market Overview
Market Size in 2024: USD 603 Million
Market Size in 2033: USD 1,659 Million
Market Growth Rate 2025-2033: 11.9%
According to IMARC Group’s latest research publication, “Saudi Arabia Data Center Colocation Market: Industry Trends, Share, Size, Growth, Opportunity and Forecast 2025-2033”, The Saudi Arabia data center colocation market size was valued at USD 603 Million in 2024. Looking forward, IMARC Group estimates the market to reach USD 1,659 Million by 2033, exhibiting a CAGR of 11.9% from 2025-2033.
How AI is Reshaping the Future of Saudi Arabia Data Center Colocation Market
- Optimizing Infrastructure Management: AI-powered data center infrastructure management (DCIM) systems are revolutionizing facility operations through predictive maintenance, intelligent power distribution, and automated cooling optimization, reducing operational costs by 25-30% while improving energy efficiency and equipment uptime across colocation facilities in Riyadh, Jeddah, and NEOM.
- Enhancing Security and Threat Detection: Machine learning algorithms are transforming data center security through real-time threat detection, behavioral analysis, and automated response systems, identifying and neutralizing security breaches 40-50% faster while ensuring compliance with Saudi Arabia’s data sovereignty and cybersecurity regulations.
- Enabling Intelligent Capacity Planning: AI-driven analytics are optimizing space utilization, power allocation, and resource forecasting through predictive modeling and demand analysis, improving facility capacity planning accuracy by 35-40% while supporting the rapid expansion of hyperscale deployments and enterprise colocation requirements.
- Revolutionizing Cooling Efficiency: Artificial intelligence systems are maximizing cooling performance through real-time temperature monitoring, airflow optimization, and predictive thermal management, reducing cooling energy consumption by 20-35% while supporting high-density AI workloads and meeting Vision 2030’s sustainability targets.
- Facilitating Automated Workload Management: AI-integrated orchestration platforms are streamlining workload distribution, resource allocation, and performance optimization across colocation environments, enabling dynamic scaling and improving service delivery efficiency by 30-45% for cloud providers and enterprise clients throughout the Kingdom.
Grab a sample PDF of this report: https://www.imarcgroup.com/saudi-arabia-data-center-colocation-market/requestsample
Saudi Arabia Data Center Colocation Market Trends & Drivers:
Saudi Arabia’s data center colocation market is experiencing explosive growth driven by the government’s Vision 2030 digital transformation agenda and massive hyperscale investments from global technology leaders. The Kingdom’s cloud services market reached USD 4.0 billion in 2024, with annual public cloud spending expected to hit USD 2.5 billion by 2026 at a 25% CAGR, creating unprecedented demand for scalable colocation infrastructure. The Saudi Data and Artificial Intelligence Authority (SDAIA) invested USD 14.9 billion in 2024 to enhance AI capabilities, directly accelerating the need for high-performance data center facilities capable of supporting intensive computational workloads.
Strategic mega-projects are transforming the colocation landscape, with NEOM’s Oxagon development planning a 1GW AI-powered data center integrating renewable energy and advanced cooling technologies, while the broader NEOM project dominates upcoming capacity with nearly 55% of total planned power allocation. Major hyperscalers including AWS (USD 5.3 billion investment), Microsoft, Google, and Oracle are establishing regional presence, with Riyadh, Jeddah, and Dammam collectively expected to add over 800 MW of capacity by 2030. The Public Investment Fund’s USD 6 billion commitment to develop one of the world’s largest data center ecosystems demonstrates the Kingdom’s ambition to become the Middle East’s preeminent digital hub.
The surge in internet penetration and digital service adoption is fueling colocation demand, with 36.84 million internet users at the beginning of 2024 and e-commerce activities projected to reach 33.6 million users, generating massive data volumes requiring robust storage and processing infrastructure. Smart city initiatives, IoT ecosystems, and the expansion of digital banking—including the launch of three digital-only banks (D360, Vision Bank, STC Bank) in early 2025—are creating sustained demand for low-latency, secure colocation services. Enterprises are increasingly outsourcing IT infrastructure to colocation providers rather than building costly in-house facilities, with SMEs and large organizations leveraging colocation for disaster recovery, business continuity, and compliance with stringent data localization requirements, while strategic submarine cable landings in Jeddah and Dammam are strengthening Saudi Arabia’s position as a critical connectivity hub between Europe, Asia, and Africa.
Saudi Arabia Data Center Colocation Industry Segmentation:
The report has segmented the market into the following categories:
Type Insights:
- Retail Colocation
- Wholesale Colocation
Organization Size Insights:
- Small and Medium Enterprises
- Large Enterprises
End Use Industry Insights:
- BFSI
- Manufacturing
- IT and Telecom
- Energy
- Healthcare
- Government
- Retail
- Education
- Entertainment and Media
- Others
Breakup by Region:
- Northern and Central Region
- Western Region
- Eastern Region
- Southern Region
Competitive Landscape:
The competitive landscape of the industry has also been examined along with the profiles of the key players.
Recent News and Developments in Saudi Arabia Data Center Colocation Market
- October 2025: Neom dominated the upcoming data center market in Saudi Arabia, accounting for nearly 55% of total planned power capacity with its 1.5 GW Oxagon project, while nearly 500 MW of additional capacity is anticipated to come online by the end of the year, primarily driven by projects from Gulf Data Hub, Sahayeb, and Ezditek.
- September 2025: Saudi Arabia’s data center colocation market positioned the Kingdom as one of the major colocation hubs in the Middle East, with Riyadh emerging as a major development location witnessing significant additions of data center space from operators such as Mobily, center3, and DAMAC Digital.
- February 2025: Equinix announced plans to develop a hyperscale data center in Jeddah, Saudi Arabia, designed for hyperscale, cloud, AI, and enterprise workloads, aiming to serve demand from global hyperscalers, regional enterprises, and government clients with carrier-neutral infrastructure integrated with Equinix’s Fabric platform.
Note: If you require specific details, data, or insights that are not currently included in the scope of this report, we are happy to accommodate your request. As part of our customization service, we will gather and provide the additional information you need, tailored to your specific requirements. Please let us know your exact needs, and we will ensure the report is updated accordingly to meet your expectations.
About Us:
IMARC Group is a global management consulting firm that helps the world’s most ambitious changemakers to create a lasting impact. The company provide a comprehensive suite of market entry and expansion services. IMARC offerings include thorough market assessment, feasibility studies, company incorporation assistance, factory setup support, regulatory approvals and licensing navigation, branding, marketing and sales strategies, competitive landscape and benchmarking analyses, pricing and cost research, and procurement research.
Contact Us:
IMARC Group
134 N 4th St. Brooklyn, NY 11249, USA
Email: sales@imarcgroup.com
Tel No:(D) +91 120 433 0800
United States: +1-201971-6302
Â
