China, US deals and robots headline Saudi Arabia's LEAP tech event

Saudi Arabia’s second LEAP technology event on Tuesday saw a host of landmark partnerships and billion-dollar investments take place with major Chinese and US companies, in line with the last phase of the country’s national strategy for digital transformation. 

On the first day of the event on Monday, the country announced $9 billion of investments in global companies, including Oracle, China's Huawei and Meta, to work with the kingdom, and at least $2.43 billion more on day two were injected into local technology businesses and more to stimulate market growth. 

Among some of the major deals was the announcement on Tuesday of a future Saudi-Chinese social media application named Hectar, which claimed to be able to compete with other “important social media applications.” 

The app is being positioned as a high-security all-in-one application that, in addition to sharing videos and photos, will provide content creators with gifts, support and opportunities to monetize from followers. 

A number of significant developments in the space of data and cybersecurity infrastructure are also expected to come amid the four-day event ending on Thursday. 

Saudi technology company EzdiTek announced that it would build four large-scale data centers in the kingdom’s major cities. 

Saudi Aramco announced a strategic partnership with Zoom, looking to build the company’s first global data center in the kingdom and explore other technological solutions in the energy sector. It also announced an expansion of its venture capital arm Wa’ed Venture from $200 million to $500 million to advance mid- and growth-stage Saudi startups. 

Welcome to Leap in collaboration with our partner Lenovo. We are glad to meet you#biotech #Leap #LEAP2023 pic.twitter.com/crdbtowT6C

— Novo Genomics (@novogenomics) February 2, 2023

In one of the main highlights at LEAP, Microsoft made an announcement of intent to invest in a new cloud data center in Saudi Arabia, putting in money to build local cloud computing infrastructure “in response to growing customer demand for cloud services and data residency in Saudi Arabia from global enterprises, local businesses and civilian public sector organizations,” wrote Microsoft. 

This is a ground-breaking development as Microsoft Azure along with Google Cloud Platform and Amazon AWS are considered the three biggest cloud providers globally, according to Haitham Al-Jowhari, a partner and cyber security and digital identity expert at PricewaterhouseCoopers (PwC) Middle East. 

“This will open the door for a lot of business,” he told Al-Monitor, given that Saudi Arabia has certain data storing requirements imposed on government entities and critical national infrastructure that don’t allow cloud data storage outside of the country. 

By building data residency, or the physical storage of data, with Microsoft in Saudi Arabia, it will allow local businesses to store data securely with fewer costs, he said, and attract foreign companies to do business in the country and scale. 

“The main obstacle that prevented global digital companies or entities from dealing with Saudi Arabia was that they offered their services from their cloud that is hosted in data centers outside the kingdom,” said Al-Jowhari, but now that Microsoft, and previously Ali Baba, are opening their cloud centers, they are able to connect to the region while ensuring a secure migration of data and, as a result, reach businesses and consumers in the kingdom. 

The King Abdulaziz City for Science and Technology also signed a memorandum of understanding with the Chinese tech giant Lenovo at LEAP. The two agreed to build the Lenovo Center for Creativity and Innovation in Saudi Arabia to enhance cooperation and digital transformation in the country, according to the Saudi Press Agency.

Saudi IT Minister Abdullah Alswaha said China's Huawei will invest $400 million in cloud infrastructure for its services in the kingdom, Reuters reported.

The Huawei and Lenovo deals represent further straightening of China-Saudi ties. Chinese President Xi Jinping visited Saudi Arabia in December, leading to the signing of more than 40 deals on energy, AI, cloud services and more. 

The gathering of global industry leaders expected to attract 100,000 attendees includes the likes of Nokia president and CEO Pekka Lundmark and celebrity football legend and technology investor Thierry Henry. 

Yet probably the most talked about celebrity was the literal face of the country’s AI strategy, Sara, the kingdom’s first Saudi-created humanoid robot that can recognize various local dialects. 

“I’m proud to meet Sara,” wrote a Riyadh-based Twitter user of a similar namesake, Sarah B Alanazi, a business technology master’s degree student focusing on robotics and AI, according to her profile. 

At #LEAP23 today , I’m proud to meet Sara. 🤖

Sara is the first Saudi humanoid robot , Sara speaks native Saudi language by the AI speech recognition system 👏🏼👏🏼 @LEAPandInnovate pic.twitter.com/5mBjTc0bkG

— SARA (@SarahBAlanazi) February 7, 2023

Unlike the symbolically naturalized citizen and humanoid robot Sophia, which was built by Dallas-based company Hanson Robotics and showcased at Riyadh’s Summit on Future Investment Initiative (FII) in 2017, Sara is Saudi-made. 

This is in line with the theme of the kingdom’s Vision 2030, currently in the third phase of its digital transformation strategy seeking to build its local AI infrastructure with smart government entities and more. 

In 2020, Saudi Arabia’s big data and AI market was valued at $164.98 million, according to Mordor Intelligence, yet the kingdom is expected to earn the largest gains from AI in the Middle East and North Africa, according to PwC, able to accrue over $135.2 billion to its economy by 2030, equivalent to 12.4% of its gross domestic product.