The Public Investment Fund (PIF) and stc Group (stc) have signed a joint venture (JV) agreement to establish a new company, specializing in the Internet of Things (IoT), subject to satisfying the conditions in the JV agreement and obtaining the relevant approvals from the competent authorities. The company ownership will be 50% PIF and 50% stc and 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 company will leverage expertise and technology of existing IoT partners, including stc, and expand to become a ‘one-stop-shop’ for IoT solutions.
The company will contribute toward boosting the IoT adoption by being a technology agnostic service provider with a solutions offering in the smart industrial manufacturing sector, smart logistics transportation sector, and smart cities. In addition to providing IoT solutions, it will also help create an 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 as one of the national champions in the information communication technology sector (ICT) 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.”
Meanwhile, Eng. Olayan Al Wetaid, CEO of stc Group, said, "Internet of things 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. Together we seek to gradually progress toward becoming a regional center for the connected digital communities in the MENA.”
Saudi Arabia at large has transformed its digital infrastructure to be a leading global digital economy. The country is benefiting from advanced fiber, 5G, NB-IoT and other connectivity technologies, putting in place a conducive investment environment for international investors.
Local market studies indicate vast growth in the size of the IoT market in the Kingdom to potentially reach SAR 10.8 Billion by 2025 with an annual growth rate of 12.8%, representing a growth opportunity and reflecting on the increased demand maturity within the economy. The 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.
stc has invested aggressively in building its 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, which stimulates the launch of IoT companies in order to provision the national trend in this field.