Saudi Arabia’s Public Investment Fund and local carrier STC have announced the signing of a joint venture agreement to establish a new company, with focus on the Internet of Things (IoT).
The partners said that the JV still needs to obtain the relevant approvals from the competent authorities. Each entity will own a 50% stake in the new IoT company, which will be headquartered in Riyadh.
The JV agreement is part of PIF’s and STC’s efforts to drive the rapid growth of the IoT across Saudi Arabia and to make it a regional center for the Middle East and North Africa.
The partners noted that the company will contribute toward boosting the IoT adoption by being a technology agnostic service provider offering new solutions in the smart industrial manufacturing sector, smart logistics transportation sector, and smart cities. In addition to providing IoT solutions, the company also aims to help create an IoT ecosystem by providing consulting, implementation and training support as well as facilitating innovative funding models to support businesses in their adoption of IoT.
Yazeed AlHumied, the deputy governor and head of MENA investment at PIF, said: “Partnering with STC will help unlock this promising sector and contribute to PIF’s efforts to localize cutting-edge technology and knowledge in Saudi Arabia and further develop a digital economy, in line with Vision 2030 objectives”.
“The company will create significant business opportunities, high quality jobs, and improve productivity and efficiency for entities adopting IoT solutions in their operations,” the executive added.
“IoT has been identified in STC’s ‘DARE 2.0’ strategy among the five strategic areas of investment. It is at our core and aligns with Saudi Arabia’s digital transformation initiatives, supported by PIF,” said Olayan Al Wetaid, CEO of STC Group.
The partners also noted that local market studies indicate vast growth in the size of the IoT market in Saudi Arabia to potentially reach SAR 10.8 billion ($2.88 billion) by 2025 with an annual growth rate of 12.8%.The partners also said that the new IoT company will aim to equip the targeted sector to realize the “Fourth Industrial Revolution” through the enablement of autonomous technologies, artificial intelligence, digital twin, sensors and other domain-specific advanced technologies.
Saudi carrier STC has been investing to deploy 5G and NB-IoT connectivity infrastructure to support enablement of IoT with more than 15,000 communication towers and a coverage rate of more than 85% of urban areas. This allows the possibility of connecting nearly 500 million IoT devices in Saudi Arabia.
