On December 28, two insiders revealed to Reuters that Apple and Amazon are in talks with the Saudi government on obtaining investment permits in Saudi Arabia, the crown prince of the Saudi Crown Prince Mohammed bin Salman One of the important measures to promote the conservative Kingdom of Saudi Arabia to attract high-tech companies to invest.
In addition, the third party's news also confirmed that Apple is negotiating with the Saudi Investment Authority (SAGIA).
In fact, both Apple and Amazon, the technology industry giants, have already marketed products in Saudi Arabia through third parties, but they and other global technology giants have been unable to open their business directly in Saudi Arabia.
Amazon's negotiations are dominated by AWS, the company's cloud computing unit, which will trigger more intense competition in the local market. Currently, the local market is largely dominated by a relatively small, localized supplier such as STC and Mobily.
In the recent two years, due to the decline in crude oil prices, the Saudi government is also increasingly in need of implementing economic diversification instead of relying solely on oil experience. This urgency has also become increasingly prominent. To this end, the Saudi government has been easing regulatory restrictions in the past two years Measures, including easing restrictions on foreign ownership that have long allowed investors to sidestep the country, also implement easing.
Attracting companies such as Apple and Amazon will help deepen the reform plan for Crown Prince Mohammed and will also help enhance the image and influence of the two companies in Saudi Arabia, a nascent but richly-populated market. Undoubtedly, Saudi Arabia has become one of the countries with the highest Internet and smartphone penetration in the world.
Data show that about 70% of the people in Saudi Arabia are under the age of 30, and they are still frequent users of social media.
According to two people familiar with the negotiations, Apple may reach a license agreement with the Saudi Investment Authority to open an Apple store in February next year, and Apple's first retail store in Saudi Arabia is expected to open in 2019.
According to sources, the negotiations between Amazon and Saudi Arabia are still in their infancy and the specific timetable for the investment plan has not been confirmed yet.
Market research firm Euromonitor data show that Apple has long been in the Saudi mobile phone market second place, after the Samsung.
Earlier this year, Amazon acquired Souq.com, an online retailer in Dubai, which laid a solid foundation for Amazon to tap the online retail market in the Gulf.
At present, both Apple and Amazon declined to comment on the above news, meanwhile, Saudi Aid Investment Administration also failed to comment on the above news.
Saudi efforts to attract Silicon Valley businesses
While Saudi Arabia has been calling for outward investment in a wide range of areas of the country in terms of reform, Saudi officials are favored by Silicon Valley businesses, which has become particularly prominent in recent years, and Saudi Arabia hopes to accomplish their highs through this initiative Technology plan.
Crown Prince Mohammed, a recognized technology enthusiast, has declared himself an innovation similar to the likes of Steve Jobs, Mark Zuckerberg and Bill Gates Send people.
During his official visit to the United States last year, Crown Prince Mohammed met with executives from companies such as Facebook, Microsoft and Uber. Uber received about $ 3.5 billion in Saudi sovereign wealth funds after the meeting, while Saudi sovereign wealth funds dominated In the hands of Crown Prince Mohammed.
According to sources, Apple and Amazon are among the most sought-after foreign companies in Saudi Arabia to stay on top. Saudi Arabia hopes to attract these outstanding enterprises and further help the country push forward the reform process.
Sam Blatteis, head of MENA Catalysts, a Dubai-based technology consultancy, said: "Today, many tech multinationals in Saudi Arabia are either selling goods to the Saudi government or investing in Saudi Arabia, For example Uber. Amazon into the Saudi market will be a transformational step. & rdquo;
For Amazon, the move also highlights how pressing AWS is to sell data storage and computing services to customers in the Middle East. From a revenue point of view, although AWS is the world's largest cloud business, but slower than Microsoft to expand the global market, and now, Microsoft cloud services to expand the number of regions has reached twice as much AWS. However, Microsoft has not announced plans to open a data center in the Middle East.