Artificial intelligence (AI), cloud computing and next-generation connectivity are rapidly changing the telecommunications, media and technology (TMT) landscape in the Middle East, positioning the region as one of the world's fastest-growing digital economies, according to PwC research.
Study shows how convergence AI, 5G, cloudGaming and quantum technologies are redefining not only infrastructure investment, but also creativity, competitiveness and national digital sovereignty. Rather than acting solely as a consumer of global technology, the Middle East is increasingly shaping its own digital future through large-scale, government-backed initiatives and partnerships with hyperscalers and technology providers.
At the center of this shift is artificial intelligence. PwC says the technology is driving growing demand for computing power, advanced semiconductors and data centers, accelerating the shift from investments in standalone models to infrastructure that enables AI at scale. Sovereign cloud platforms and hyperscale data centers are becoming the foundation of this transformation, supporting national AI strategies, data residency requirements, and trusted digital ecosystems.
Cloud adoption is accelerating rapidly. PwC predicts that by 2025, about 85% of the region's digital infrastructure will be cloud-based, reflecting the convergence of artificial intelligence, cloud and 5G. This transition is creating demand for hybrid and sovereign cloud environments that combine scalability with security and compliance. However, cloud security remains a major concern, with organizations citing it as one of the cyber risks they feel least prepared for.
The Middle East is also quickly becoming a global hub for artificial intelligence computing. PwC estimates regional data center capacity could reach 5GW to 6GW by 2030, driven by the expansion of hyperscalers, cloud sovereign programs and national AI ambitions. Saudi Arabia, the UAE and Qatar are leading this build through hundreds of megawatts of projects involving global technology partners.
Telecom operators play a central role in this evolution. PwC highlights how telcos are moving beyond connectivity to become owners and operators of digital infrastructure, investing heavily in data centers, fiber networks and artificial intelligence-enabled platforms. By embedding artificial intelligence into 5G networks, telecom companies are optimizing performance, reducing costs and opening new revenue streams in smart cities, Industry 4.0, immersive consumer services and enterprise digitalization.
Quantum computing is becoming another strategic frontier. PwC notes increased investment in the GCC, including long-term national partnerships and the creation of dedicated quantum centres. While the technology promises breakthroughs in areas such as energy, finance, defense and cybersecurity, the study warns that readiness remains low. Despite quantum energy being recognized as a major future cyber threat, PwC found that many organizations have yet to implement quantum-resistant security measures.
In media and entertainment, AI is changing the entire value chain. According to PwC, broadcasters and streaming platforms in the Middle East are using AI to personalize content, automate workflows, fight piracy and distribute Arabic content to global audiences. This shift allows regional platforms to compete more effectively with international players while strengthening cultural identity and local intellectual property.
Games have become a prime example of this strategy. PwC highlights Saudi Arabia's commitment to making gaming and esports an important pillar of the economy, supported by sovereign investment, infrastructure development and talent programs. Its goal is to create tens of thousands of jobs and add billions of dollars to GDP by 2030, signaling how digital creativity is woven into broader diversification programs.
PwC concludes that the Middle East's telecommunications and communications transformation is being driven by informed choice, cloud sovereignty, native AI infrastructure, Arabic content and next-generation networks. If these initiatives are successfully scaled, the region will move beyond rapid adoption and become a global benchmark for how technology, culture and economic strategy come together in the digital age.
