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Qatari telecom provider Ooredoo told CNBC on Wednesday that it has a new partnership Nvidia complies with all US regulations and still offers access to the latest technology.
Ooredoo signed a partnership with earlier this week Nvidiamarking the chipmaker's first large-scale entry into the Middle East market. The companies did not disclose the value of the deal.
The deal will deploy thousands of Nvidia GPUs (graphics processing units) in 26 data centers in Qatar and five other countries: Kuwait, Oman, Algeria, Tunisia and the Maldives. These chips will help data centers process massive amounts of information, which will power AI chatbots and other tools, essential components of a country's AI infrastructure.
The deal comes after the United States last year restricted sales of certain advanced chips to some Middle Eastern countries over fears the technology could be intercepted by China.
Washington is allowing the export of some Nvidia chips to the region, and Nvidia, AMD And Intel have all indicated plans to make less powerful chips for export to the Chinese market. The restrictions target A100 and H100 chips, and not GPUs (another type of semiconductor) that are at the center of this deal.
Ooredoo told CNBC that the deal complies with all US regulations. No new licenses for different chips were created under the partnership.
“As a telecom operator, dealing with very strict regulations is business as usual. We are used to dealing with regulators and government agencies, whether they are local or international,” Ooredoo CEO told CNBC.
“We are working very closely with the various regulators and with Nvidia to see all required approvals and provide all required guarantees,” he added.
There is a tug-of-war between China and the United States in the race to acquire and protect the latest artificial intelligence technology. The United Arab Emirates' main AI group, G42, pledged to phase out Chinese hardware to appease Washington. later closing a deal with Microsoft worth $1.5 billion.
Gulf countries are leveraging their vast energy wealth to try to become pioneers in artificial intelligence, investing in the development of the technology and importing vast quantities of chips used in AI data centers.
According to Ooredoo's CEO, the chips are next-generation GPUs dedicated to artificial intelligence and “will be able to deliver extreme machine learning and model usage of these AI models and generative AI.”
They are used to provide government services to citizens and to improve the productivity and efficiency of general enterprises and research and development.
The cloud partnership between Ooredoo and Nvidia aims to position the chipmaker as the central source for AI technology in the region, and according to Ooredoo will drive innovation, development and create jobs. The countries will have access to Nvidia's latest full-stack AI platform, which can serve both Ooredoo and non-Ooredoo customers through independent data centers.
Ooredoo also pledged to invest $1 billion to increase the capacity of its regional data centers, even before announcing the partnership with Nvidia. Aziz Aluthman Fakhroo, CEO of Ooredoo, told CNBC's Dan Murphy that he expects this investment to be recouped in the coming years.
“The demand we're seeing from the cloud alone and now adding that layer of AI to it is already exceeding our most optimistic plan, so we'll likely exceed that investment in the next three to five years.”
Qatar Investment Authority-backed Ooredoo, which is listed in both Qatar and Abu Dhabi, plans to develop a platform powered by AI and powered by Nvidia, hoping to meet market demand.
Nvidia briefly became the world's most valuable company last week, overtaking it Microsoft. The chipmaker rebounded in Tuesday trading, ending a three-day losing streak that wiped out more than $550 billion in market value.
