While Saudi reform plans call for luring foreign investment broadly across sectors, officials have courted Silicon Valley players especially strongly over the past two years to complement their high-tech ambitions.
Prince Mohammed is an avowed technophile and has styled himself a disrupter in the model of Steve Jobs, Mark Zuckerberg and Bill Gates.
During an official visit to the United States last year he met executives at Facebook, Microsoft and Uber, in which the sovereign wealth fund he chairs later took a $3.5 billion stake.
Since then, he has also set up a $45 billion technology investment fund with Japan’s SoftBank and announced plans to create a futuristic $500 billion mega-city with more robots than humans.
Apple and Amazon have both been on a Saudi priority list of foreign firms which officials hope to attract to further their reforms, one of the sources said.
“Many tech multinationals now in Saudi Arabia are either vendors to the Saudi government or, in the case of Uber, have benefited from a sizable Saudi investment,” said Sam Blatteis, who heads Dubai-based tech advisory MENA Catalysts Inc.
“Amazon entering the Saudi market would be a step-change.”
For Amazon, the move underscores how AWS is looking to take an early lead in selling data storage and computing services to customers in the Middle East.
AWS, the world’s biggest cloud business by revenue, has embarked on a slower global expansion than No.2 Microsoft, which now offers cloud services in twice as many regions.
However, Microsoft has yet to announce plans for data centres in the Middle East, with three regions in India serving as its closest operations.
AWS said in September it would set up data centres for the region in neighbouring Bahrain.
The kingdom has been streamlining its many overlapping laws which could apply to cloud computing for more than a year in order to attract service providers.
If completed, a cloud deal could pave the way for an expansion of Amazon retail warehouses in Saudi Arabia.
Although Amazon operates its diverse business units separately, it has rolled out its near-full suite of retail, third-party marketplace and cloud services in countries of operation over time.
Apple stores would raise the profile of the company’s products and offer repairs and community events in line with its strategy to brand its stores as “town squares”.
Source: https://www.cnbc.com written by Katie Paul on December 28, 2017 for CNBC