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Slowdown? What slowdown? Microsoft signs huge $544 million data centre deal with UAE's Telco Du

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UAE’s digital future gets a major upgrade from Microsoft’s regional investment

A person standing in front of a rack of servers inside a data center
(Image credit: Shutterstock.com / Gorodenkoff)
  • Microsoft and Du join forces on data center to fuel next-gen AI power
  • AI adoption demands scale, and Microsoft and Du’s $544 million project meets the challenge head-on
  • The new hyperscale data center will be built in phases, serving Microsoft’s cloud expansion

With AI adoption growing rapidly, hyperscale data centers are becoming essential to support the workloads of advanced AI tools, including those powering leading AI writing platforms.

At the recent Dubai AI Week, Microsoft and UAE-based telecom provider Du announced plans to build a $544.54 million hyperscale data center in the UAE.

“This marks a significant investment in digital infrastructure, reinforcing Dubai's leadership in adopting the latest technologies, innovations, and digital services,” said Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, Deputy Prime Minister, and Minister of Defense, in a LinkedIn post celebrating the announcement.

Strengthening UAE AI infrastructure

The new data center will be a core component of Microsoft's ongoing effort to expand its cloud and AI infrastructure in the Middle East. It follows earlier collaborations, including a partnership with the Abu Dhabi government and Core42 to offer AI services and sovereign cloud capabilities within the UAE.

Du CEO Fahad Al Hassawi noted the investment is, “a pivotal leap in our strategic goal to revolutionize the digital ecosystem of the UAE.”

The center’s capacity will be delivered to Microsoft in phases, although specific timelines and technical details have not yet been disclosed.

Du currently operates five data centers across the UAE, and earlier in 2025 signed a deal to extend the Peace subsea cable to the country.

Microsoft has steadily expanded its cloud presence in the Middle East since launching its UAE cloud region in 2019. The company has since announced similar regions in Qatar, Israel, and Saudi Arabia, with additional plans for a new cloud region in Kuwait.

The new UAE-based hyperscale data center will help meet growing demand for low-latency access to cloud platforms that power everything from top web hosting services to next-generation enterprise applications.

Via DataCenterDynamics

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Efosa Udinmwen
Efosa Udinmwen
Freelance Journalist

Efosa has been writing about technology for over 7 years, initially driven by curiosity but now fueled by a strong passion for the field. He holds both a Master's and a PhD in sciences, which provided him with a solid foundation in analytical thinking. Efosa developed a keen interest in technology policy, specifically exploring the intersection of privacy, security, and politics. His research delves into how technological advancements influence regulatory frameworks and societal norms, particularly concerning data protection and cybersecurity. Upon joining TechRadar Pro, in addition to privacy and technology policy, he is also focused on B2B security products. Efosa can be contacted at this email: udinmwenefosa@gmail.com

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