SAP to invest $200m in United Arab Emirates

European software maker plans investment to get near customers in the Middle East

European software maker SAP is investing $200m in the United Arab Emirates (UAE), including a new Middle East headquarters in Dubai.

SAP will also build a datacentre in the UAE to help it win local customers in the government and banking sectors.

The company wants to be closer to its customers in the region. “Our UAE investment plan and our new Middle East and North Africa headquarters in Dubai affirm our commitment to this strategic market, with public-private partnerships fuelling digital transformation, co-innovation, talent development and entrepreneurship,” said Luka Mucic, CFO member at SAP.

The datacentre investment will help SAP to win customers in the Middle East. Companies in the region are investing in their IT infrastructures to help them use new digital technologies and most prefer to have locally hosted services. This is particularly the case in Gulf Cooperation Council (GCC) countries, such as Saudi Arabia and the UAE.

Oracle is another global business software giant that is building IT infrastructure in the Middle East. Last year, it opened a datacentre in UAE capital Abu Dhabi to deliver locally hosted cloud services.

The likes of SAP and Oracle have an opportunity to sell cloud-based applications, known as software as a service (SaaS), to Middle East organisations. According to the Computer Weekly/TechTarget IT Priorities research for 2017, 35% of CIOs in the region expect to deploy SaaS.

Read more about cloud computing in the Middle East

Figures from Gartner also give suppliers confidence to plan cloud infrastructure investments in the Middle East. The analyst company said organisations in the region would spend a total of $1.2bn on public cloud services this year, and it expects this figure to nudge $2bn by 2020.

Gartner named SaaS as the biggest slice of cloud spend, with $307m expected to be spent across the Mena region this year, with this figure expected to more than double to $620m by 2020.

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