Tencent's AI and cloud to accelerate the Middle East's Tech-led transformation

The generative AI (genAI) disruption has only grown in intensity since OpenAI announced the launch of ChatGPT in November 2022. Leading technology vendors are either launching their own large language models (LLMs) or leveraging existing LLMs to ensure their customers can transform, innovate, and disrupt their respective industries and not churn to the competition.

This was further evidenced by the various pathbreaking announcements made by Tencent last week during its Global Digital Ecosystem Summit 2024 in Shenzhen, China. Tencent Cloud, a Shenzhen-based AI and cloud technology vendor, is assertively spreading its wings beyond the Chinese mainland into other Asian countries, and the Middle East, Europe, and other commercially attractive countries.

During the event which took place at the Shenzhen World Exhibition and Convention Center, Tencent Cloud’s leadership presented its flagship AI solutions including the Knowledge Engine Platform, Digital Human, e-KYC and more, to empower enterprises in the AI era, to the technology leaders, analysts, and media from across the world.

Tencent Cloud’s commitment to improving LLMs was visible when Mr. Dowson Tong, Senior Executive Vice President of Tencent and CEO of the Cloud and Smart Industries Group (CSIG), explained how the company intends to use cloud and AI technologies to solve some of the pressing problems facing the world today. Tencent Cloud’s AI platform is already a leader among its peers that support the Chinese language to run LLMs, but Tong reiterated that the company plows back a significant portion of its revenues into R&D.

Tencent Cloud completes the cloud story with its multi-cloud management solution called Housekeeper which helps customers reduce cloud wastage. IDC’s research reveals that around 28% organizations in the Middle East waste or may waste more than 30% of their cloud investments in 2023 and 2024.

While there are already quite a few companies working with Tencent Cloud to co-deliver superior customer value in the Chinese market, interaction with the Tencent Cloud International team highlighted that the vendor intends to collaborate with partners in other markets to try out use cases in retail, gaming, banking, healthcare, mining, manufacturing, and other industries where agility is prioritized.

In the Middle East, AI- and cloud-led business transformation is a top priority for enterprises. According to a recent IDC survey of organizations in the Middle East, AI tops the chart of technologies that will receive funding in 2024, with multi-cloud following in second place. IDC’s study reveals that accelerated cloud adoption has seen the region’s IT estate become increasingly hybrid in recent years and that around 90% of organizations in the Arab world are now using more than one cloud solution.

From an industry mix standpoint, the Middle East’s retail sector seems to be regaining some of its charm, while gaming is emerging as a sunrise sector, especially in Saudi Arabia. Asset-intensive organizations in the oil and gas, utilities, aviation, manufacturing, and shipping and logistics sectors stand to benefit immensely if Tencent Cloud starts offering its AI and cloud solutions in the region.

A representative example is the collaboration between Tencent Cloud and Abu Dhabi’s Department of Culture and Tourism. With its Digital Human solutions, Tencent Cloud powers Abu Dhabi’s digital ambassador for culture and tourism, engaging millions of users on Weixin (WeChat).

Even though the desert may appear to be a brownfield at first sight, it is very much a greenfield for cloud and AI vendors, with abundant opportunities to transform organizations with pathbreaking technologies and a trustworthy partner ecosystem.

In the past three years, Tencent Cloud has consistently achieved double-digit growth in the overseas market. New markets such as Saudi Arabia and the UAE have witnessed even more rapid growth, proving that Tencent Cloud is becoming a key player in the cloud market throughout the MENA region.

Jyoti Lalchandani

Group Vice President and Regional Managing Director, Middle East, Türkiye, Africa, and India, IDC