The Tencent logo is displayed on the exterior of Tencent’s headquarters building and a surveillance camera can be seen in the foreground on November 30, 2024 in Shenzhen, Guangdong Province, China.
Chen Xin | Getty Images News | Getty Images
tencent The company aims to strengthen its cloud computing business outside of China and plans to expand its data center footprint in the Middle East, a top executive at the Chinese tech giant told CNBC.
Dawson Tong, CEO of Tencent’s Cloud Group, told CNBC that the company plans to expand the number of “availability zones” (locations designated as sites for potential clusters of data centers) for its cloud services in countries in Asia Pacific, Europe and the Middle East over the next 12 to 18 months.
In the Middle East, Dowson added that Tencent is “actively” looking to build data centers to serve its cloud customers.
“We’re going to increase our investment in the region and establish a stronger partnership network, and that’s all in the plan,” he said, without citing a more specific timeline or exactly which countries the availability zones might be located in.
Tencent’s expansion plans in the Middle East come as countries in the region attract huge investments from tech giants to build AI data centers and other computing infrastructure.
Over the past year, Nvidia, OpenAI and others have been working on building large-scale AI infrastructure projects under the Stargate brand in the United Arab Emirates.
Gartner analysts predicted in August that information technology spending in the Middle East and North Africa region would reach $155 billion in 2025, an increase of nearly 9% from a year earlier and faster than global growth.
Tencent has already opened availability zones in Saudi Arabia. Further expansion in the Middle East is likely to expose the company to more direct competition from the US giant. Amazon, microsoft and google.
Dowson said Tencent already has customers in Saudi Arabia purchasing its cloud services, including the Chinese giant’s international food delivery subsidiary Keeta. Meituan. Dowson added that Tencent, one of the world’s largest gaming companies, also uses the Saudi-based company’s cloud services.
While most of Tencent’s revenue still comes from gaming, the company has sought to diversify its business by expanding into other areas, including cloud computing.
Tencent is seeking to differentiate itself from its U.S. rivals by leveraging its strong customer base in China to expand internationally. For example, customers using Tencent’s cloud in China may also purchase the company’s services abroad.
The Middle East is becoming an important expansion region for Chinese companies.
Lenovo, the world’s largest PC company, has established a regional headquarters in Saudi Arabia and is currently building a manufacturing facility there.
“I think there are so many initiatives and investments being made in the Middle East, so I think we’re very excited about the opportunities there,” Lenovo Chief Financial Officer Winston Chen said in an interview with CNBC last week.
