UAE's Stargate data centre deal is a sign of things to come

Racks of servers at a data centre in Moscow. Investments into 1GW Stargate UAE will reportedly be in the $20 billion range, according to OpenAI. Bloomberg

When one thinks about data centres – physical spaces used to host the IT infrastructure that forms the backbone of our modern digital societies – their advanced capabilities may mean that some still think of them as nascent technologies. Today’s hubs for servers, cloud storage and connection networks are truly impressive, handling trillions of gigabytes of data a second.

However, early forms of data centres have been around since the 1940s. The US military’s Electrical Numerical Integrator and Computer – the first general-purpose digital computer – weighed 30 tonnes, took up more than 165 square metres of space and required a small power plant for electricity. What is different now is that instead of a single supercomputer for one concern, such as the army, data centres are critical infrastructure as important as the national power grid or air traffic control.

Underlining the indispensability of modern data centres is what happens when they stop functioning. Last week, a fire broke out at an Oregon data centre leased by the social media giant X. The platform later suffered global performance issues that lasted several days, leading Elon Musk, the site’s owner, to post that “major operational improvements need to be made”.

At the launch of Stargate UAE were President Sheikh Mohamed; Sheikh Khaled bin Mohamed, Crown Prince of Abu Dhabi; Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, Deputy Prime Minister and Minister of Defence; Sheikh Tahnoon bin Zayed, Deputy Ruler of Abu Dhabi and National Security Adviser; Khaldoon Al Mubarak, chairman of the UAE’s Executive Affairs Authority; Peng Xiao, G42 chief executive; Jensen Huang, chief executive of Nvidia; Sam Altman, chief executive of OpenAI; SoftBank Group founder Masayoshi Son; Jeetu Patel, Cisco's president and chief product officer; Mike Sicilia, Oracle executive vice president; and Marty Edelman, group general counsel of G42. Photo: G42

It is in this context that one of the world's largest computing infrastructure projects is taking shape in the UAE. Abu Dhabi AI company G42 has teamed up with technology giants OpenAI, Oracle and Nvidia, alongside Japan's SoftBank Group, to create Stargate UAE. This will form part of a system of OpenAI-linked data centres around the world that are critical to today's economic, societal and business needs.

Investments into 1GW Stargate UAE – built in co-operation with Cisco and SoftBank Group and part of a planned 5GW campus – will reportedly be about $20 billion, according to OpenAI. This is part of UAE-US AI campus that will include 5GW of capacity for AI data centres in Abu Dhabi, announced during US President Donald Trump's visit to the Emirates. The new AI campus, the largest outside of the US, will be home to US hyperscalers and large enterprises that will use the capacity for regional computing with the ability to serve many countries.

That market-leading tech companies are committing to such a monumental project in partnership with the UAE highlights not only its capacity to host large-scale tech but its reputation as a place that has embraced data as the currency of the future. The country offers a secure environment for IT infrastructure, can supply the immense amounts of energy needed to run data centres, and has embraced AI and advanced tech at the highest levels of government.

The project is the result of years of building relationships. The Stargate announcement is just the latest in a series of high-profile agreements between the UAE and tech giants, as well as the US government with the White House announcing in March that the Emirates had committed to a $1.4 trillion investment framework related to artificial intelligence infrastructure, semiconductors, energy and manufacturing.

The project is the result of years of building relationships

Further developments are in the works. The UAE has at least 17 data centres, according to data compiled by industry tracker DataCentres.com, and has plans to boost this figure. Last month, telecom provider du and Microsoft announced that a hyperscaler data centre worth Dh2 billion ($545 million) is to be built in Dubai. This is aside from enormous investments poured into the UAE's data centre market by Oracle, Google and other big-name players.

Although the days of 30-tonne computers are firmly in the past, hosting the digital infrastructure of the 21st century offers plenty of challenges and opportunities. For an idea of how both will be met, looking at the UAE’s role as a major data centre hub is a good place to start.