Du plans to offer 'affordable and accessible' cloud and AI services in the UAE

Dubai telecoms company is considering expanding its ICT services to the Saudi market, its chief executive tells The National

Du chief executive Fahad Al Hassawi says the company is becoming a 'hyper-scaler' in the UAE. Antonie Robertson / The National

Dubai telecoms operator du aims to offer “affordable and accessible” cloud and artificial intelligence services in the UAE as it prepares to launch them locally next year.

The company will start by offering cloud and AI services to government agencies by the first half of 2025, competing with major players like Microsoft, Amazon and Google in the UAE market, its chief executive told The National.

In the beginning, the company will provide its services to government bodies in Dubai, the Northern Emirates and the UAE federal bodies, Fahad Al Hassawi said. It aims to deliver cost-effective solutions locally, and the move will also reduce costs associated with transferring data outside the region, he said.

“It will usher an era of more affordable, faster, and more secure services in the Emirates. Currently, the majority of cloud services are provided by the US-based entities and the entry of a local player will boost confidence and adoption rate,” he said.

“By providing tailored multi-cloud solutions, we ensure that businesses only pay for the services they truly need, reducing their overall expenditures.”

Du, which is formally called Emirates Integrated Telecommunications Company, has joined forces with leading cloud service provider Oracle, in a partnership that was originally announced in July.

“Du is becoming the hyper-scaler … our government customers will be directly dealing and contracting with du. We are very excited with the upcoming opportunities … as a hyper-scaler player in the UAE, we will be competing with global cloud companies,” Mr Al Hassawi said.

“Since the cloud services will be provided by a government-backed company [du], it will help foster greater confidence in the market and automatically boost adoption … the issue of where data is stored is very important in our region and we have the advantage of being a trusted local player in the UAE.”

A hyper-scaler is a cloud provider that operates a large-scale data centre network to offer computing, storage and other technology services.

Du said it will be running these new services from its own data centre in the UAE, enabling its customers to migrate their systems to the cloud while providing greater control over operations, location and security to help manage strategic public sector data and support digital sovereignty.

In a bid to achieve its cloud and AI aims, du has created a dedicated business unit led by chief information and communication technology (ICT) officer Jasim Al Awadi, who directly reports to Mr Al Hassawi. Du declined to disclose the budget that it has set aside for the new business stream.

Without providing a specific timeline for the project, Mr Al Hassawi said du has initiated discussions with UAE entities to both showcase the capabilities that cloud solutions can offer and to better understand their needs, including their workloads and priorities for migration.

Mr Al Hassawi, who is in Las Vegas to attend Oracle’s CloudWorld conference, also met Oracle chief executive Safra Catz to discuss future plans.

“Safra is extremely excited about our partnership. She understands the significance of our region very well and knows that without the right partner here, it will be difficult for customers to adopt and advance on this journey.”

Mr Al Hassawi explained the cloud and AI plans are part of the company’s wider vision to diversify its product portfolio and emerge as “strong local ICT player”.

“Du is trying to move outside only telco. We want to offer widespread ICT services that will include FinTech, cloud solutions, data centres, IoT [Internet of Things] and AI,” he said.

“We already have a strong base of customers across the UAE that includes individuals, enterprises and government entities. They are evolving rapidly and we need to keep pace, becoming their provider for all things related to ICT and telecommunications.”

The UAE public sector is one of the most digitally advanced in the world. It is embracing the latest technologies such as cloud, AI and machine learning to improve citizen services, security and access to the latest digital offerings. Mr Al Hassawi said du’s ambitions will hasten the process.

Founded in 2005, du is the UAE's second-biggest telecoms operator. It serves nearly nine million users in the Emirates with mobile, fixed-line and broadband internet services, and caters to more than 100,000 businesses in the region.

Will du expand beyond the UAE?

Mr Al Hassawi said du is also planning to expand its ICT offerings, including cloud solutions, beyond the UAE market. But the company has no plans to extend its telecoms services outside the Emirates.

“We intend to venture outside the UAE to offer our ICT services, with implementation varying on a case-by-case basis … we have set no timeline because we want to do it the right way … we will be very selective about where we go and about our potential partnerships to ensure we don't fail to execute,” said Mr Al Hassawi.

He said the foremost market for du expansion will be Saudi Arabia, considering the size and potential of the market.

“Our success mantra is simple – just follow our customers. For example, their presence in the UAE, as well as in markets like Saudi Arabia, Turkey and Egypt, will influence the scope of our expansion.”

Mr Al Hassawi explained that du is “very cautious” in pursuing this transformation journey, as many operators around the world have not been successful in similar transformations.

Linking up with global cloud providers

Du said it is also considering partnerships with other big names in the cloud industry such as Amazon Web Services and Microsoft, to achieve its AI and cloud ambitions.

With a 31 per cent market share, AWS is the biggest player in the global cloud infrastructure services sector, followed by Microsoft Azure with 25 per cent and Google Cloud with 10 per cent, data from Statista shows.

“We want to be multi-cloud provider, offering a secure product with du’s branding. We understand that different customers have different requirements, therefore we would like to give customers enough choices in terms of solutions,” Mr Al Hassawi said.

“Oracle is a pioneer in having a sovereign cloud product. The remaining hyper-scalers have not reached that point yet. So, when Oracle came up with this solution, we felt this is the right thing, right partner and the right time. It matches exactly what we want to do.

“The idea is not to create many such [cloud solution] providers in the country, there will be only one … so we have to make sure that we are choosing the right path as well as the right partner.”

Texas-based Oracle serves many local clients in the UAE including DP World, Abu Dhabi Customs, Dubai Investments, Mashreq and Emirates Post. It also has its dedicated cloud regions, facilities that house at least two data centres, in Dubai and Abu Dhabi.

How big is the UAE cloud market?

Revenue in the public cloud market is projected to reach more than $1.9 billion in the UAE this year, according to Statista. It is expected to surge at a compound annual growth rate of 19 per cent, reaching more than $4.5 billion by 2029.

The global cloud computing market size was estimated at $602.31 billion last year and is predicted to surge at a compound annual growth rate of 21.2 per cent from 2024 to 2030, according to a report by Grand View Research.

In the cloud industry, businesses pay only for the selective services or resources they use over a period of time.

For businesses, moving to a cloud system hosted by a specialised company is more economical than creating their own infrastructure of servers, hardware and security networks. It also brings down the overall cost of ownership.

Du’s journey beyond a major telecoms player

In the past few months, du has hastened its efforts towards diversifying its ICT offerings.

“We aim to transition from being solely a connectivity provider to becoming a full ICT provider. There is already a strong trust in our brand and customers know who we are … now, we are offering top-tier ICT products while ensuring that customers maintain full control over them,” Mr Al Hassawi said.

In April the company launched Du Pay FinTech platform, which offers a range of financial services, including domestic and international transfers, bill payments and recharging, cash-in and cash-out services, and receiving salary through a unique Iban number.

The uptake for Du Pay was “better than our initial projections”, Mr Al Hassawi told The National in July.

In May it unveiled du Smart Car, which provides internet services in vehicles. The company's expansion into other segments comes amid growing profitability on the back of the UAE's strong macroeconomic environment.

Net profit attributable to shareholders in the three months ending in June rose 46 per cent annually to Dh581 million ($158.2 million), du said in a regulatory filing to the Dubai Financial Market, where its shares are traded. Its revenue climbed 7.3 per cent to more than Dh3.59 billion.