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Niel ups his bid for Millicom to $4.4bn, but can he keep up?

Annie Turner
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Niel ups his bid for Millicom to $4.4bn, but can he keep up?

Last month the Latin American group rejected his $4.1bn bid and since then has entered into potential deals in Colombia and Costa Rica

French telecoms billionaire, Xavier Niel, has increased his offer for Millicom to about $4.4 billion. His previous offer of $4.1 billion was rejected last month. It was made through his investment vehicle Atlas Investissement which already holds a 29% stake in Millicom which has operating companies in the Caribbean and Latin America.

In between Niel’s two bids, Millicom has been busy.

Acquisitions in Colombia?

At the end of July, Millicom entered into a non-binding agreement to acquire Telefónica Colombia’s 67.5% stake in the incumbent fixed and mobile operator Coltel for $400 million. Operating under the brand name TigoUNE in Colombia, it has also to bid for the government’s holding and those of other minor stakeholders at the same price. Millicom is also working towards gaining full control of its own Colombian operation.

Telefónica Colombia’s is the country’s second largest mobile operator with 25% market share, about half that of leader Claro, which is part of America Movil.

According to sources, this means that Millicom is looking to spend about $1 billion, funded by a combo of cash and debt, to strengthen its presence in the Colombian market. This also plays to Telefónica’s long-term strategy announced at the end of 2019. The group is looking to extricate itself from Latin America, apart from Brazil which is one of its key four markets, along with Spain, Germany and the UK.

All change in Costa Rica

Then, on the first day of August, Millicom announced it is to merge its opco in Costa Rica with that of Liberty Latin America’s. It will be all-stock transaction, after which Liberty and a minority stakeholding partner will retain 86% of the Costa Rican combined enterprise and Millicom the remaining of 14%. The exact details of ownership will be announced once the deal is complete, apparently.

Mauricio Ramos, Chair of Millicom, explained the rationale in a statement: “Our combined operations would significantly benefit the telecommunications sector by enhancing fibre network investment to help accelerate Costa Rica’s technological evolution in a highly competitive market.

“This merger is expected to generate new efficiencies and improve commercial offerings, providing customers with access to mobile services and premium content. It creates a stronger, more competitive entity with high investment capacity to meet the accelerated technological changes, network expansion, and service improvements, ensuring that long-term market conditions remain competitive while maintaining high-quality and valuable services for our customers in Costa Rica.”

The transaction is subject to the usual closing conditions, including regulatory approvals. The parties say they expect it to complete in the second half of 2025. 

What now for Niel?

So where does this leave Niel? At the time of writing, Millicom’s share price stood at $25.93, up from $16.40 a year ago. On 2 August Millicom (Tigo) announced its Q2 figures which showed at 4.7% rise in revenues and net profit of $78 million.

Millicom’s new CEO, Marcelo Benitez, said about the earnings, “Millicom has an important transformation aimed at significantly increasing the company’s equity free cash flow. These efforts began to pay off in Q2, with EBITDA [earnings before interest, taxes, depreciation, and amortisation] up almost 20% organically, EFCF [equity free cash flow] of 268 million and leverage significantly down to 2.77x, putting the company on track to achieve its 2024 targets.

“Meanwhile, we are streamlining our product offerings and internal processes, which is enhancing productivity and generating cost beyond savings beyond the initial targets of the efficiency project Everest, we are prioritizing ARPU growth in Mobile, reducing churn in Home, and accelerating growth in B2B.

“We are also making return-focused investments to sustain our market leadership and drive driving growth in the second half of 2024. All these actions are designed to ensure continued EFCF growth in 2025 and beyond, in line with our long-term plan.”

Millicom has until 16 August to decide whether it will accept the offer. Right now it feels like he’s a couple of steps to slow to catch Millicom’s rising star.

Juniper predicts 15,000 new satellites over next 5 years for IoT

Annie Turner
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0
Juniper predicts 15,000 new satellites over next 5 years for IoT

That’s a growth rate of 150%, from 10,000 satellites this year to more than 24,000 by 2029, but multi-orbit solutions are the key to success

A new study from Juniper Research predicts that the number of satellites in orbit to support IoT connectivity will grow by 150% over the next five years. That would be a rise of 10,000 satellites in 2024 to more than 24,000 by 2029.

The new report, Global Satellite IoT Services Market 2024-2030, says growth will be driven by increased demand for connectivity from IoT network users “in nomadic locations”. It forecasts that 98% of the satellites launched over the next five years will be low-Earth orbit (LEOs) due to the low cost of launches.

Multi-orbit solutions

To meet the demand for satellite connectivity for IoT, the study urges substantial investment in multi-orbit satellite solutions. This model combines the low latency and high throughput from LEOs and the extensive geographical coverage of geostationary earth orbit (GEOs) to deliver a single service.

The research found that some IoT applications – such as nomadic operational areas and conditional monitoring – necessitate the use of LEOs and GEOs for complete service provision.  Partnerships that combine the two will be essential to attract enterprises in these sectors.

Return on satellite investment

This approach will also enable satellite providers to cater for many IoT use cases, including data-intensive and low power, wide area (LPWA) connections.

The study further urges satellite network operators to form strategic partnerships to fill the coverage gaps between LEO and GEO capabilities. It identified construction and infrastructure and logistics, as two key growth opportunities.

Global tablet market growth finally passes prepandemic levels – IDC 

Simon Dux
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Global tablet market growth finally passes prepandemic levels – IDC 

Steady growth in Q2 for tablets, which now join smartphones in stemming declines

Worldwide tablet shipments recorded year-over-year growth of 22.1% in the second quarter of 2024, totalling 34.4 million units, according to preliminary data from analysts International Data Corporation (IDC). The results benefited from a favorable comparison to the prior year’s quarter and were driven by product refreshes from many top vendors and a replacement cycle combined with inventory replenishment.  

However, volumes are comparable only to pre-pandemic shipment levels and not to the unprecedented sales witnessed during the pandemic. The Q2 24 results compare favorably with Q2 2019 when 32.5 million units were shipped, aided by a product refresh from Apple and the growing popularity of detachable tablets from Samsung and Huawei. 

 According to IDC, Apple shipped 12.3 million units and grew by 18.2% year over year in the quarter. With the launch of the 11″ and 13″ iPad Air and iPad Pro models, the company was finally able to record growth in the market. iPad volumes grew across the globe except for China, where competition from local players like Huawei and Xiaomi negatively impacted the company. 

Samsung ranked second with shipments of 6.9 million units in 2Q24, which represents year-over-year growth of 18.6%. The vendor managed to grow despite not having any major product launches. Growth mainly came from several commercial deployments and a favorable 2Q23 comparable. 

Lenovo captured the third position this quarter with year-over-year growth of 16.7% and shipments of 2.5 million units. The company’s detachable tablets recorded much higher annual growth (39.7%) than its slate tablets (11.7%). 

Huawei held the fourth position this quarter with solid year-over-year growth of 40.3% and shipments of 2.3 million units. The vendor introduced a new tablet, MatePad 11.5S, which has shown great market performance and the June online promotions in China further aided growth. 

Xiaomi finished the quarter in fifth position. The company’s shipments grew 94.7% year on year to 2 million units. Beyond China and Asia/Pacific (excluding Japan), the vendor has made significant gains in the European market with impressive growth in Russia, France, Germany, Italy, Spain, and many other countries. 

“The [second quarter] results signal that the market has moved beyond the pandemic. We expect the refresh cycle and growth in emerging markets to continue aiding the recovery in the near term,” said Anuroopa Nataraj, senior research analyst with IDC’s Mobility and Consumer Device Trackers. “While new entrants to the market focus on their global expansion, long-term leaders continue to focus on improving technology (as in the case of OLED displays for iPad Pros), catering to the need for premium devices, and utilising the power of emerging technologies like AI.”  

She added: “Long-term gains for the market depend on the vendors’ ability to build devices that can carve a niche for tablets – one that includes innovation and differentiation.” 

Smartphones surge 12% in Q2 

Adding to the positive news with tablets, the latest Canalys research reveals that the worldwide smartphone market continued to grow strongly in Q2 2024, with shipments reaching 288.9 million units. The market has now grown for three consecutive quarters. 

Despite a modest 1% shipment increase, Samsung held onto pole position with 53.5 million units shipped. Its high-end product lines continued to boost value growth, while the revamped 5G A series maintained overall numbers. Apple held second place with 45.6 million units, bolstered by strong momentum in North America and APAC’s emerging markets.  

Xiaomi, with its competitive product offerings, closely followed with shipments of 42.3 million units to achieve a market share of 15%. Making a return to fourth place, vivo shipped 25.9 million units for a market share of 9%. TRANSSION came fifth, shipping 25.5 million units and taking a market share of 9%.  

“In the second half of 2024, Apple and Samsung will focus on solidifying their long-term strategies in mature markets, while other brands will hope to boost sales in emerging markets, having stocked channels in anticipation of higher operating costs,” said Canalys senior analyst Sanyam Chaurasia.  

“In Q2, Europe and North America saw significant volume increases as vendors proactively stockpiled inventory for upcoming holiday sales seasons. Samsung will inevitably focus on integrating its Galaxy ecosystem to create strong value propositions for consumers via its flagship offerings with exclusive GenAI features,” he said. “Apple will look to accelerate replacement demand in these markets via its AI strategy, with hybrid models, enhanced privacy and personalized Siri features.” 

Five of UK’s fibre altnets form coalition to push for fairer regulation and pricing

Annie Turner
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0
Five of UK’s fibre altnets form coalition to push for fairer regulation and pricing

They have joined forces to demand equal terms access to Openreach’s physical infrastructure as Ofcom’s next review of access looms

Five of the UK’s largest fibre alnets have joined forces to push for fairer access to physical infrastructure operated by Openreach. nexfibre initiated the Physical Infrastructure Access (PIA) Coalition which has AllPoints Fibre, Community Fibre, Gigaclear, and newly-merged Netomnia and Brsk as members. They jointly pass more than 5 million premises ready for service, making them among the largest users of Openreach’s wholesale infrastructure. 

The Coalition conducted a detailed economic analysis of Openreach’s PIA regulation (carried out by SPC Network). It showed an imbalance between Openreach and altnet operators, particularly in pricing, where they operators pay “significantly more” to access ducts and poles than Openreach charges itself. 

The Coalition is calling for Ofcom to act on this information and ensure all users of PIA have a level playing field for access to infrastructure in its upcoming Telecoms Access Review (TAR).

The group warns that failure to act will harm competition and investment in the long-term, threatening the progress of fibre roll-out to homes and businesses. This, the coalitions says, would damage the UK’s ability to compete internationally. 

Holes and poles

The coalition acknowledges that sharing Openreach’s poles and ducts with other operators has been one of the successes of Ofcom’s 2021 market review and a major driver of faster fibre deployment in recent years. Ofcom regulates PIA products through a series of terms and conditions, and pricing. The regulator is responsible for looking after the interests of all PIA users.

Under Ofcom’s rules, PIA access must be offered by Openreach in a way that does not discriminate against third-parties, that is, anybody that is not BT. Openreach is a semi-detached subsidiary of the former monopoly. The PIA Coalition has identified evidence to suggest that pricing is discriminatory but hasn’t provided details.

Ofcom’s upcoming Telecoms Access Review will assess the fixed telecoms market, the challenges it faces and set-out regulatory frameworks for 2026-31. The decisions made will have far-reaching consequences for the future of the UK’s digital infrastructure, economy and society. The coalition claims that without decisive action, “policymakers risk losing the momentum the market has worked so hard to build”.

O-RAN ALLIANCE specs to be added to ATIS standards

Annie Turner
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O-RAN ALLIANCE specs to be added to ATIS standards

ATIS’ members are in North America and the parties hope this will encourage the take-up of Open RAN

ATIS and the O-RAN ALLIANCE have signed a Memorandum of Understanding (MoU) that “enables the transposition of O-RAN ALLIANCE specifications to ATIS standards”. 

The MoU has put in place a process to identify O-RAN specifications for adoption by ATIS. They say this “transposition is a major step toward advancing the adoption of Open Radio Access Network (RAN) in North America, by giving O-RAN ALLIANCE specifications the benefit of recognition by ATIS, an accredited standards body with broad membership from North American industry”.

The intention is to “advance the industry towards more intelligent, open, virtualized and global standards-compliant mobile networks”. Today’s agreement announced builds on an earlier MoU to cooperate on Open RAN issues, including security and stakeholders’ requirements for Open RAN.

Weight of two organisations

ATIS’ President and CEO, Susan Miller, commented in a statement, “ATIS members both from industry and government sectors are highly aligned on the importance of Open RAN in creating an ecosystem of trusted suppliers that can deliver capable and cost-effective mobile network platforms.

“The MoU with O-RAN ALLIANCE gives the combined weight of both organizations to a common technical basis for interoperability in the Open RAN market. It complements the ATIS work on the Open RAN Minimum Viable Profile to create comprehensive and recognized Open RAN standards and best practices for the North American market.”

Abdurazak Mudesir, Chair of the Board of O-RAN ALLIANCE and Group CTO of Deutsche Telekom, added, “O-RAN ALLIANCE specifications set the global foundation for open, intelligent, virtualized and interoperable Radio Access Networks, building on common RAN standards.

T-Mobile US breaks the 100m postpaid barrier and closes in on larger rivals

Annie Turner
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0
T-Mobile US breaks the 100m postpaid barrier and closes in on larger rivals

Deutsche Telekom’s US subsidiary added 1.3 million customers during the quarter and had a churn rate of 0.8%

T-Mobile US has published its Q2 figures which include its churn rate was 0.8% while its nett additions were 1.3 million. This means it now has more than 100 million postpaid customers and has raised it expectations regarding new customers this financial year. It now predicts that it will attract between 5.4 million and 5.7 million (up by 200,000 at the bottom end).

For comparison, AT&T had about 115.47 million mobile subscribers at the end of Q2 this year and Verizon 114.8 million subscribers at the end of March.

During Q2, T-Mobile’s service revenues were up by 4% on the same period last year, helped by its first subscriber price increases in a decade. Service revenues rose to $16.4 billion (€15.1836 billion) beating analysts’ forecasts of $16.3 billion.

Peter Osvaldik, CFO at T-Mobile, said that new subscribers came from rural areas and densely populated conurbations. He said the numbers do not include customers adding a second line: “These are high-quality customers that are flocking to this network and are actually willing to pay for it.”

Refreshing change

In May, T-Mobile gained 3.5 million subscribers after finally completing the $1.35bn acquisition of no-frills provider Mint Mobile after gaining approval from the Federal Communications Commission (FCC). As regulators always do, the FCC had had concerns about the effect the acquisition might have on competition in the market.

To allay these concerns, T-Mobile has agreed to allow Mint customers to change providers, without financial penalty during the 60 days after the acquisition won approval. It also committed to uphold Mint’s popular prepaid service that costs $15 a month for existing and new customers “for the foreseeable future”.

Fixed expectations

The operator also added 406,000 to its fixed wireless access customer base in Q2, which T-Mobile US says consistently leads Ookla’s speed tests to and is hailed as the best provider by consumers, Opensignal finds that T-Mobile has the best US network experience overall.

And while polishing its own trumpet, T-Mobile US also took the opportunity to point out its “total 5G and ultra-capacity 5G coverage area continues to far exceed that of the next closest competitor. The company’s unique multi-layer approach to 5G, with dedicated standalone 5G deployed nationwide across 600MHz, 1.9GHz, and 2.5GHz, delivers customers a consistently strong experience and 87% of 5G traffic is on sites with all three spectrum bands deployed.”

Vodafone adds LTE-M to its IoT service portfolio 

Simon Dux
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Vodafone adds LTE-M to its IoT service portfolio 

The operator moved its IoT business into a separate company in April 2024, essentially turning it into an MVNO so adding LTE-M will broaden its potential customer base

Vodafone has announced it is adding Long Term Evolution for Machines (LTE-M or LTE Cat-M1) to its IoT services portfolio, joining NB-IoT, 4G and 5G IoT connectivity for customers. LTE-M is specifically designed for IoT applications that usually do not have a constant power supply and only transmit small amounts of data.  

LTE-M is optimised for low power consumption, which makes it suitable for battery-powered devices. It works best in scenarios which involve infrequent, small bursts of data transmission making it ideal for sensors for telemetry or status updates. It also provides extended coverage and better signal penetration. Like NB-IoT, LTE-M is a Low Powered, Wide Area Network (LPWAN) technology. LPWAN technology can allow IoT devices to operate reliably for up to 10 years on a single battery charge. 

“When you have a data-led business, decisions are driven by insight not by assumption. IoT has the potential to revolutionise business, but we must make it accessible to all,” said Vodafone UK business director Nick Gliddon. “The power of LTE-M is the ability to choose the right tools for the right job. 5G might be the right choice for some IoT use cases, whereas LTE-M might be better for others. By enabling LTE-M to sit alongside 4G, 5G and NB-IoT, we are providing a technology-agnostic solution for customers. This is about picking the right solution, at the right price point.” 

He clarified by adding that while 4G and 5G solutions are available for IoT use cases that require high data throughput, constant connectivity and low latency to respond in micro- or milliseconds, LTE-M and NB-IoT are designed for low data throughput and non-time sensitive use cases. LTE-M can provide continuous connectivity and low latency services in some scenarios, but only to facilitate small data batches.  

LTE-M and NB-IoT differ in their typical download/upload speeds (300kbps and 20kbps respectively). NB-IoT is better for difficult to reach locations and batch data upload (such as underground water pipes or smart meters in basements), while LTE-M is optimised for mobility (such as asset tracking and wearable devices) and event-based connectivity.  

Managed connectivity 

All Vodafone IoT customers also gain access to Vodafone’s own Managed IoT Connectivity Platform to provide intelligence into how devices are performing with service diagnostic and analytics tools to manage operations in real-time, as well as a range of APIs to integrate with customer backend IT systems. 

Customers can also take advantage of Vodafone’s global network presence, and its relationships with roaming and technology providers to create a single interface to the world of IoT connectivity. With 1,400 dedicated IoT professionals across five continents, supporting 160 million IoT connections, Vodafone reckons it can support all use cases from local to multi-national.  

Global possibilities 

When Vodafone spun off its IoT unit the move was linked to its broader strategic partnership with Microsoft, announced in January 2024 given that this also saw Microsoft playing a key role in scaling Vodafone’s managed IoT connectivity platform. The partnership meant the telco could use Azure to help expand its service offerings but more importantly, its market footprint.  

The rollout of LTE-M has seen varying progress across different regions globally. As of early 2024, there were 61 operators that had deployed or commercially launched LTE-M networks worldwide, with 20 operators planning, piloting, or trialling the technology, according to industry body GSA. 

Europe has been relatively proactive in adopting LTE-M and you could argue that Vodafone is a late arrival. For example, Deutsche Telekom completed its LTE-M network rollout in Germany in 2020, providing enhanced connectivity for IoT applications. The region’s significant demand for industrial automation and investments in enhanced manufacturing operations has driven this growth.  

Telefónica’s H1 net profit up by 29% to just under €1bn

Annie Turner
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0
Telefónica’s H1 net profit up by 29% to just under €1bn

This is on revenues up by 1.2% to €10.255bn in Q2 pushing H1 revenues to €20.395bn and the operator is on target to meet financial guidance

Telefónica has released its earnings for the first half of 2024 for which it recorded a net income of €979 million, an increase of 28.9% compared to the same period last year. The operator says it continued to accelerate revenue growth, profitability, and sustainability in line with the three pillars of its Growth, Profitability and Sustainability (GPS) strategic plan announced last November. The company confirms the financial targets set for the full year. 

Telefónica reported solid revenue growth in the first half of the year, which accelerated in the second quarter. Between April and June, revenue increased by 1.2% to €10,255 million, driven by service revenues, which rose by 2.2%. For the half year, revenues grew by 1.1% to €20,395 million.

Source of revenues

Also in line with the first quarter, between April and June 61% of revenues came from the residential market (B2C), 22% from the business segment (B2B) and the remaining 18% from the wholesale business, partners and other revenues.

Operating income before depreciation and amortization (EBITDA) in the second quarter increased in all geographic areas to €3,219 million (+1.8%). In the first six months of the year, it grew by 1.9% to a total of €6,424 million.

CapEx amounted to €2.299 billion in the first half, 3.9% less than in the same period of 2023, after falling 8.9% to €1.243 billion in the second quarter. These figures put the ratio of investment to revenues at 11.3%, consistent with the objective of ending the year below 13% and show that Telefónica continues to roll out its network and “defend the leadership of its infrastructures through controlled investment”.

In line with more efficient growth and greater profitability, operating cash flow (EBITDaL-Capex) rose 3.1% in the first half to €2.748 billion, after accelerating 11.5% in the second quarter.

Free cash flow amounted to €205 million in the second quarter. Excluding extraordinary items, it would have reached €484 million, a progression compared to the first quarter that will continue in the second half of the year to meet the announced target of growth of more than 10% by 2024.

Active management of tech cycles

The operator says the degree of virtualisation in its infrastructure has enabled it to accelerate the development of fibre and 5G technology, as well as the switch-off of retail copper service in Spain. The company “maintained its position as the global leader in fibre”, with 177 million ultrafast broadband premises passed, up 4%, of which a total of 78.9 million were FTTH (+13%), including 23 million UUII from the Group’s various fibre vehicles. In the second quarter alone, the number of FTTH premises increased by 2.3 million, 51% of which were deployed by Telefónica’s fibre vehicles. 

No rain in Spain

Telefónica Spain has also just signed a non-binding fibre JV with Vodafone Spain. The two are looking for an investment partner and expect Telefonica to be the major stakeholder.

With a strong performance in the Spanish market, Telefonica looks to be in a strong position to withstand the reshaped market, which includes Zegona Communications acquiring Vodafone Spain and MasMovil and Orange merging.

The favorable performance in the first half of the year and the acceleration in the second quarter were specially reflected at Telefónica España. In the second quarter accesses grew in all the main segments: fixed broadband, mobile contract, television and convergent accesses.

As a result, quarterly revenues rose 1% to €3,127 million and EBITDA increased 0.6% to €1,114 million. For the first half, revenues were up 1% to €6,245 million and EBITDA rose 0.4% to €2,231 million.

5G coverage

In 5G, Spain maintains 89% population coverage, Germany 96%, Brazil 50% and 65% in the UK. Moreover, 5G Standalone has been launched commercially launched in those four major markets and is already generating revenues from network slicing.

José María Álvarez-Pallete, Chairman of Telefónica, said, “Revenues are growing, EBITDA is up and the customer base is larger and more satisfied with the service we provide. Telefónica is a more profitable and sustainable company, meeting the pillars of its GPS strategic plan, confirming all its financial targets for 2024 and reaffirming its attractive shareholder remuneration.”

More details here

Vodafone Spain, Telefonica to form a JV fibreco and want an investor partner

Annie Turner
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0
Vodafone Spain, Telefonica to form a JV fibreco and want an investor partner

This is the same model as Vodafone’s fibreco with MasOrange announced last week: the two JV aim to pass a total of 15m premises

Vodafone Spain and Telefonica de Espana have signed a confidential, non-binding agreement that sets out the key terms to create a new fibre network company. The announcement was made by Zegona Communications which owns Vodafone Spain. The fibreco will cover about 3.5 million premises and will provide fibre access services to both companies within this footprint.

The combination of this new fibreco plus the deal Zegona announced last week with MasOrange will bring the total number of homes Vodafone Spain and partners will pass to 15 million. Zegona says they will give Vodafone Spain cost efficient access to extensive all-fibre networks across Spain”.

Initial ownership

The initial ownership split of the fibre with Telefonica de Espana will be based on their customer numbers within the footprint. The parties intend to bring a third-party financial investor into the share capital of the new company. At that point, they expect Telefonica to retain majority ownership and Zegona to retain 10%.

This is a similar model to that Vodafone Spain is adopting with MasOrange.

Eamonn O’Hare, Chairman and CEO of Zegona, commented “Creating a new FibreCo in partnership with Telefonica is another key milestone in our plan to transform Vodafone Spain.

This transaction fully complements the MasOrange FibreCo we announced last week and gives Vodafone Spain guaranteed access to future-proof networks with attractive economics. Moving Vodafone Spain to these new FibreCo structures is expected to create significant incremental value for all Zegona stakeholders.”

Saudi to build more sustainable data centres as part of cloud-first strategy

Annie Turner
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0
Saudi to build more sustainable data centres as part of cloud-first strategy

The Saudi Data and Artificial Intelligence Authority (SDAIA) has not said how many will be built or their total capacity

SDAIA’s President, Dr Abdullah Al-Ghamdi, launched several infrastructure expansion projects and new data centres in Riyadh which apparently “are the first of their kind” in the Kingdom of Saudi Arabia. The Kingdom also has a Cloud First strategy as part of its digitalisation programme, Saudi Vision 2030.

It has already attracted substantial investments by AWS, Oracle, Google, Microsoft, Huawei and others. For example, Amazon Web Services (AWS) plans to launch an AWS infrastructure region in Saudi Arabia in 2026. It has committed to invest more than $5.3 billion in the country.

The newly announced projects are intended to increase the capacity and operational efficiency of data centres. The programme is part of SDAIA’s strategy to develop sustainable data centres built to the best global practices and standards set by the UPTIME Institute, the global authority on data centre evaluation and classification.

They will have electrical capacity of up to 65 kilowatts per cabin but the exact number of new data centres and the total new capacity under development is unknown.

Mordor Intelligence estimated the country’s capacity was 345.31 MegaWatts (MW) in 2024, and is expected to reach 854.81MW by 2029, at a CAGR of 19.88% between those years.

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