The Iran war has disrupted Big Tech’s Middle East data-center plans: AWS complexes in Bahrain and the UAE were hit by Iranian drones or damaged by nearby strikes. Six months later, AWS still cannot restore access to resources in one affected UAE zone.
The Middle East accounted for about 3% of global live data-center capacity in 2026. In August, regional capacity was 1.6 gigawatts, with 2.6 GW under development and 13.8 GW in planning. Jones Lang LaSalle said the war had “paused, not canceled” the region’s AI-capacity outlook. Microsoft reaffirmed plans to spend more than $15 billion on AI development in the UAE by the end of 2029, including over $5.5 billion in capital expenses for AI and cloud infrastructure.
Reuters reported that the UAE-US AI Campus, envisioned as a 5-gigawatt site in Abu Dhabi, is now expected to be spread across data centers in the UAE to reduce targeting risk. Underground construction, blast-resistant materials and air defenses are reportedly under consideration. Some protections, such as missile defenses, would have to come from host governments; data-center and cloud providers would be responsible for others.
