EXPLAINER

UAE is building the future of internet, with data centres at its core: Know how

UAE’s data centre boom is quietly powering everything from your streaming to your savings

Last updated: July 19, 2025 | 06:06

3 MIN READ

UAE and Gulf governments are speeding up data transformation and blockchain adoption, and when that happens there is always a soaring need for more data storage.

Dubai: From streaming your favourite Netflix show to making a simple Google search or bank transfer — none of it would be possible without data centres. These often-overlooked facilities are the invisible force behind nearly every digital interaction in our daily lives.

In the UAE, data centres are getting a major spotlight. With billions being invested and new facilities popping up across Abu Dhabi, Dubai and Ajman — and even abroad — the country is rapidly becoming a global hub for digital infrastructure.

Also Read: Stargate UAE: OpenAI to build world’s largest AI data centre in Abu Dhabi

But what exactly are data centres, and why is the UAE going all in?

What is a data centre, exactly?

Think of a data centre as the brain of the internet — a secure building filled with powerful computers, servers, and storage systems that work 24/7 to manage and process information. Every time you use an app, stream a video, or store a file in the cloud, it passes through a data centre somewhere.

These facilities are designed to be fast, reliable, and incredibly secure. They need round-the-clock cooling, backup power systems, and cybersecurity protections to ensure the data they hold is always safe and accessible.

Why are data centres so important?

Data centres are the backbone of the digital economy — and here’s why they matter so much:

Everything digital runs through them: E-commerce, social media, streaming services, online banking — all rely on data centres to function.
Zero downtime: They’re built with backup systems to make sure services stay online, even during power cuts or outages.
Speed matters: Locating data centres close to users cuts down lag and speeds up services — crucial for things like real-time trading or live streaming.
Security: They’re heavily guarded physically and digitally, protecting your sensitive data from hacks or loss.
Scalability: As internet usage grows, companies can quickly ramp up capacity by plugging into larger centres.
Cost-effective: Businesses save money by using shared or cloud-based centres instead of running their own.

UAE in the global data centre race

The UAE is quietly becoming a digital powerhouse. Thanks to its strategic location between Asia, Europe and Africa, world-class infrastructure, and heavy investment in AI and cloud technologies, the country is fast emerging as a regional — and global — data hub.

By 2029, the UAE’s data centre capacity is expected to hit 841 megawatts, with investments topping $1.9 billion by 2028. That’s a huge leap in just a few years — and a clear sign of where the country’s priorities lie.

Dubai, Abu Dhabi lead the way

Some of the UAE’s biggest players are already making waves:

Khazna Data Centers (majority-owned by Mubadala) is the market leader, with over 59% share. It’s even building a massive AI-focused facility in Ajman.
e& (formerly Etisalat) runs centres like SmartHub in Fujairah and Dubai.
Moro Hub, located in the Dubai solar park, is powered by renewable energy.
Microsoft and AWS have large-scale facilities in the country.
Group 42 (G42), an AI specialist in Abu Dhabi, is working on Stargate UAE — a groundbreaking 5-gigawatt data project with partners like OpenAI and Nvidia.

These centres are not just storing data — they’re powering AI, smart cities, healthcare innovations, and cloud services used across the region.

Also Read: AI 'data halls': Nvidia partners UAE's Khazna to build next-gen infrastructure

Sustainability at the core

Running massive banks of servers uses serious energy — but the UAE is tackling this head-on. Solar-powered centres and smart cooling systems are being introduced, especially at government-backed projects like DEWA and Moro Hub. The aim? Grow digital infrastructure and meet green energy goals.

UAE money is building data hubs abroad too

The UAE’s digital ambitions aren’t limited to home turf.

G42 is exploring deals with Elon Musk’s xAI and partnering with Oracle and Microsoft abroad.
Mubadala, ADQ are investing billions in power infrastructure — the lifeline of future data centres.
MGX, part of a $30 billion AI push with Microsoft and BlackRock, signals a global UAE presence in digital tech.

Why this matters to you

Whether you’re a gamer, business owner, content creator, or just someone who shops online — the rise of UAE’s data centres will likely make your digital life faster, safer, and more connected in the coming years.

And as the world moves deeper into cloud computing and AI, the UAE is positioning itself not just as a participant — but as a leader.

So next time your app loads instantly or your Zoom call doesn’t drop, you might have a UAE data centre to thank.

Justin VargheseYour Money Editor

Justin is a personal finance author and seasoned business journalist with over a decade of experience. He makes it his mission to break down complex financial topics and make them clear, relatable, and relevant—helping everyday readers navigate today’s economy with confidence. Before returning to his Middle Eastern roots, where he was born and raised, Justin worked as a Business Correspondent at Reuters, reporting on equities and economic trends across both the Middle East and Asia-Pacific regions.