STC, Alibaba Group announce cloud services deal

State-owned Saudi Telecom Company (STC) announced a $500 million partnership deal with venture capital fund eWTP Arabia Capital, and Alibaba Cloud to provide high-performance public cloud services in the Kingdom.

Alibaba Cloud, which is the digital technology and intelligence backbone of Alibaba Group, considers KSA as a strategic market for its operations in the GCC region, and is keen on contributing to the country’s Vision 2030.

“This collaboration is a significant milestone for STC in our efforts to contribute to Saudi Arabia’s Vision 2030 by introducing a trusted cloud service partner,” Minister of Communications and Information Technology Abdullah Al-Swaha told reporters.

The partnership will allow STC to capitalize on the proven cloud-based technologies and services of Alibaba Cloud to accelerate the growth of the local technology ecosystem.

The deal will allow the Chinese tech titan to set up new offices within the country’s capital, Riyadh, in hopes of offering better services to local customers, while utilizing it as a regional training and management center in the region.

“Saudi Arabia is a strategic market for us,” Jeff Zhang, President of Alibaba Cloud Intelligence, Partner of Alibaba Group, said in a statement, adding that “Alibaba Cloud is committed to delivering our best-in-class services and solutions, as well as our business practices in digital transformation to the partners and customers we work with in the Kingdom.”

STC will invest around $500 Million in cloud services to reinforce its digital infrastructure to accelerate the growth of its local technology ecosystem, in alignment with its “DARE” strategy and Vision 2030 objectives.

Faisal Al-Khamisi, Chairman of the Saudi Federation for Cybersecurity Programming and Drones, said that such partnerships would make Saudi Arabia “one of the most innovative countries in the world.”

“We are very proud and thankful to bring both these great companies together with the support of the Saudi Federation for Cybersecurity Programming and Drones,” Jerry Li, Managing Partner of eWTP Arabia Fund added.

The partnership will cement the Kingdom’s future place as a digital and cloud services hub in the MENA region, as it has increased its efforts on becoming an epicenter of cloud computing technology operations.

“It’s pivotal for companies to deploy and maintain an elastic, scalable and secure IT infrastructure to keep competitive and innovative in the digital era. We are excited to partner with Alibaba Cloud to bring their expertise to our customers,” Nasser Bin Sulaiman Al-Nasser, CEO of STC Group, said in a statement.

Earlier last week, Saudi Aramco Development Company and Google Cloud signed an agreement to offer services to customers in Saudi Arabia. According to Aramco, Google Cloud will establish and operate a new cloud region in Saudi Arabia and a new company will be formed to supply cloud solutions and services to customers.