A PYMNTS Company

Saudi Arabia Implements ‘Data Center Regulations’ to Drive Digital Transformation

 |  January 2, 2024

The Communications, Space, and Technology Commission (CST) of Saudi Arabia has ushered in the new year with a significant milestone in its pursuit of digital transformation. The “Data Centre Services Regulations” document officially came into force on January 1, 2024, marking a strategic move to invigorate the data centre sector within the Kingdom.

With a focus on fostering a conducive environment for the projected growth in the data centre industry, the regulations aim to boost the development of Saudi Arabia’s IT infrastructure. This initiative is part of the CST’s broader strategy to promote digital transformation, attract technology investments, and position the Kingdom as an appealing destination for multinational companies.

The key objectives of the regulations include stimulating investments in data centres, ensuring fair competition, and optimizing the use of information technology infrastructure. Notably, there is a strong emphasis on the importance of promoting advanced and environmentally friendly data centres, aligning with global trends in sustainable technology practices.

CST officials highlighted the expected benefits of these regulations, including elevated service quality, enhanced user protection, and increased attractiveness for data center service providers. The move is anticipated to attract high-quality investments across various sectors, including cloud computing, gaming, video streaming, and content delivery networks.

The regulations are in line with the CST’s broader mission to localize and enhance digital services within Saudi Arabia. Positioned as a pivotal element in implementing strategic plans, these regulations are poised to strengthen the Kingdom’s status as a regional hub, making it an attractive destination for investors and entrepreneurs alike.

The regulations’ scope encompasses wholesale and retail data centre service providers operating within Saudi Arabia. The registration process is a key component, mandating service providers to register with the CST falling under distinct categories: Qualifying, Limited, Standard, and Advanced. Each category is subject to specific requirements and criteria, with a notable emphasis on the inclusion of energy management and sustainability plans, aligning with Saudi Arabia’s commitment to environmental responsibility.

As Saudi Arabia embraces the digital era, the implementation of these regulations is expected to play a crucial role in shaping the landscape of the data centre industry, paving the way for innovation, investment, and sustainable growth.

Source: Edge Middle East