Artificial Intelligence (AI) is already changing governments, businesses, and sectors all throughout the Middle East. It is not a futuristic idea, especially here in the Middle East. Countries including the UAE, Saudi Arabia, and Qatar are making AI a national priority, investing heavily in infrastructure, regulation, and talent to position themselves as global technology leaders. AI-driven automation, real-time analytics, and intelligent decision-making are becoming fundamental to how organizations operate, scale, and compete.
The rapid rise of Generative AI (Gen AI) into our lives has also increased the urgency for businesses to rethink their data strategies and infrastructure. Gen AI models, like GPT-based architectures, have propelled businesses into a new era, and with the emergence of Agentic AI, which is a form of AI designed more like human intelligence, with an ability to take actions and make decisions without constant supervision, we are seeing AI help further. However, the agentic shift brings a new challenge; AI can only be as powerful as the data it is trained on and the infrastructure that supports it.
This point is where many organizations face roadblocks, and where I imagine most enterprise IT leaders are currently stuck. Many businesses struggle with three fundamental challenges: Data, infrastructure, and strategy.
Poor data quality, fragmented storage systems, and outdated infrastructure often prevent AI from delivering real business impact. For AI to move beyond proof-of-concept and into real-world transformation, business leaders must address each of these foundational issues.
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AI is only as good as the foundation beneath it
Most companies are not struggling with AI because they lack the right algorithms or models. The challenge is often more fundamental. Recent research in the UK shows a gap between hype and reality in terms of business outcomes, including inaccuracy of results such as hallucinations in Gen AI and errors in underlying data skewing outputs. Many organizations find their data is not AI-ready, their infrastructure cannot handle AI workloads, and leadership has yet to make more widespread AI adoption a strategic priority.
One of the biggest misconceptions is that businesses simply need better AI-powered tools. But with tools and technologies updating all the time, the real problem is the quality and accessibility of data. The second challenge is infrastructure. AI workloads are data-intensive and require high-speed processing. Many businesses are still relying on legacy IT (CPU-based) systems that were never designed to handle real-time AI operations. Without an infrastructure built for scalability, speed, and efficiency, businesses will struggle to realize the full potential of AI. That’s exactly why the UAE has made such aggressive moves to transform and create a stronger digital backbone.
With existing data center capacity already surpassing 240 MW, the UAE is on course to see a major increase in capacity, with investments reaching $3.33 billion by 2030. The final challenge is where to begin. AI adoption does not require a multi-year transformation strategy to get started. The most successful organizations begin with targeted, high-impact use cases. Getting the value story right is key.
The business case for AI in the Middle East
AI is already delivering measurable value across industries in the region. The organizations investing today will define the future of AI-powered businesses. In the UAE, we are not just seeing AI adoption; the leaders are building an AI-first economy based on world-class infrastructure. All industries will benefit from this, particularly those with large data sets such as finance, healthcare, life sciences, government services, and telecoms.
With the telecoms sector undergoing rapid digital transformation already, it’s easy to see how AI is playing a critical role in optimizing network performance, automating maintenance, and enhancing customer service. Predictive analytics is helping operators detect network failures before they happen, reducing downtime and improving reliability. AI-driven customer support is improving response times and reducing costs.
AI-powered chatbots and virtual assistants now handle routine queries so human agents can focus on more complex issues. As 5G networks expand across the region and with the 6G era due in 2030, AI will be critical for managing network traffic and ensuring seamless performance. AI adoption is also expanding across finance, healthcare, and government services, increasing the need for strong security and compliance measures.
AI is also transforming enterprise applications. Banks are adopting AI for automated loan approvals, risk assessment, and fraud detection, improving decision-making and reducing human error.
Governments and enterprises are also looking at AI to drive sustainability and economic efficiency. Energy providers across the GCC are using AI to optimize power grid management, predict energy demand, and integrate renewable energy sources. In manufacturing, AI-powered predictive maintenance is reducing equipment failures and extending the lifespan of machinery. In smart city planning, AI-driven traffic management and waste collection systems are improving efficiency, cutting emissions, and enhancing urban sustainability.
How Middle East businesses can lead the AI race
Unlike other regions where AI adoption is slowed by regulatory uncertainty, the Middle East is moving fast. Governments are taking a proactive approach to AI regulation, workforce development, and investment in AI-ready infrastructure. The challenge for businesses is no longer whether to adopt AI, but how to do it effectively. The first priority must be data. AI really is only as powerful as the data it processes, and poor data quality leads to poor AI performance. Businesses must consolidate fragmented data sources, improve real-time access to analytics, and ensure compliance with evolving AI regulations.
Infrastructure must also be AI-ready. AI workloads require high-performance, low-latency storage and compute resources. Moving away from legacy systems and adopting AI-optimized storage solutions will be key to supporting the next generation of AI applications..
The real value of AI is in its ability to improve efficiency, reduce risk, and make smarter business decisions. AI can predict market trends, optimize supply chain logistics, and enhance security by identifying threats before they become breaches.
Businesses that use AI to inform strategic decision-making will undoubtedly be in a stronger position to compete in an increasingly AI-driven economy, not just because of the technology, but because a forward-thinking vision and culture will provide ‘early mover’ status and attract strong talent too. The choice for business leaders is now very clear: Act now and lead or risk being left behind. The unrelenting speed of AI transformation is only increasing.
Haider Aziz is vice president of META at VAST Data.
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