According to a new report by UnivDatos, the Saudi Arabia Data Center Colocation Market is expected to reach USD million in 2033 by growing at a CAGR of 11.95% during the forecast period (2025- 2033) due to the accelerated push of the digital economy under Vision 2030, which emphasizes cloud development, smart city development, and data sovereignty. Expansion is driven by increasing demand from the BFSI sector for secure and compliant hosting, the rise of e-commerce, and governmental policies mandating the use of the cloud as the primary option. Moreover, the rise of strategic alliances contributes to Saudi Arabia's emergence as a burgeoning digital hub for the entire MENA region. On February 13, 2025, Ooredoo Group and Iron Mountain announced a landmark strategic partnership, which will see the global leader in information management services take a minority equity stake in Ooredoo’s carrier-neutral data centre company, MENA Digital Hub. Also, to meet the rising demand for colocation, AI, Cloud services, and hyperconnectivity in the region.

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Driver: Robust Digital Infrastructure & Connectivity

The data center colocation market in Saudi Arabia is primarily driven by the country's robust digital infrastructure and high-speed connectivity. Furthermore, the widespread fiber optic coverage, the increasing 5G coverage, and the availability of key submarine cable routes make the Kingdom a regional connectivity hub. This powerful foundation facilitates businesses to obtain low-latency performance, secure cloud services, and cross-border data interaction. Moreover, with the rapid growth in demand for digital-based services, connectivity intensity continues to drive the use of colocation and sustainable development. For example, on February 17, 2025, Etihad Etisalat Company (Mobily) announced that it would invest a substantial SAR 3.4 billion (approximately USD 905 million) in digital infrastructure in the Middle East. The announcement was made during the concluded LEAP 2025 technology conference in Riyadh. The amount would be invested in data centers, submarine cables, and fiber networks.

Segments that transform the industry

• Based on enterprise size, the Saudi Arabian Data Center Colocation market is segmented into small and medium enterprises and large enterprises. Among them, the large enterprises segment is expected to grow with the highest CAGR during the forecast period (2025-2033F). Large companies drive market growth by necessitating the implementation of high-performance infrastructure to support AI, big data, and key applications. They require compliance, uptime, and redundancy, which forces operators to invest in Tier III and Tier IV data centers. The expansion of multinationals and large Saudi companies will secure long-term colocation contracts, ensuring the stable growth of the market.

Region that transforms the industry

• The Western Region is expected to grow at the highest CAGR in the market during the forecast period (2025-2033). With Jeddah, Makkah, and Medina leading the way, the Western Region is emerging as one of the strategic growth colocation clusters. Its location as a trade gateway, facilitated by its good logistics, ports, and proximity to international submarine cables, increases its attractiveness in terms of international connections. Jeddah, in particular, is experiencing a surge in investments in data centers to support e-commerce, logistics, and meet the increasing demands of its population. The region also benefits from large-scale projects in smart cities and digital infrastructure associated with the tourism and hospitality industries. With Saudi Arabia building an encryption paradise along the Red Sea coastal belt, the Western Region becomes the most dynamic addition to Riyadh's galvanic domination. For instance, on February 10, 2025, NEOM and DataVolt signed a landmark agreement, marking a significant step toward realizing the Kingdom’s vision for a sustainable, data-driven economy in Oxagon, Red Sea coast.
• An initial investment of USD 5 billion by DataVolt will fund the first phase of the factory’s development, expected to be operational by 2028.
• The agreement marks a significant milestone in the expansion of KSA's digital infrastructure, reinforcing its position as the region’s leading data hub.

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Key Offerings of the Report

Market Size, Trends, & Forecast by Revenue | 2025−2033.

Market Dynamics – Leading Trends, Growth Drivers, Restraints, and Investment Opportunities

Market Segmentation – A detailed analysis By Type, By Enterprise Size, by End Use Industry, by Region

Competitive Landscape – Top Key Vendors and Other Prominent Vendors

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