[Edaily Reporter Shin Yeong-bin ] #Naver is expanding its footprint in Saudi Arabia through its AI infrastructure business. After laying the groundwork for its local operations with technology that recreates real cities in virtual spaces, the company is now expanding its reach into cloud and data center services.

Naver’s entry into the Saudi market began with digital twins. Digital twins are a technology that faithfully recreates real-world cities or facilities in a virtual space for use in urban planning, transportation, construction, and other areas. Building on this, Naver has participated in Saudi Arabia’s urban digitization projects and established cooperative relationships with local governments and companies.

The focal point of these efforts is a local joint venture. In May of last year, Naver Cloud established “Naver Innovation,” a joint venture with NHC Innovation—a digital technology firm under the Saudi National Housing Company (NHC). This joint venture is driving digital twin and map-based super-app initiatives. It is also responsible for collaborating with local institutions and companies, localizing services, and identifying new business opportunities.

Recently, the focus of this collaboration appears to be shifting toward the underlying infrastructure that powers AI. According to the information technology (IT) industry on the 2nd, Naver began discussions with Saudi partners last year regarding a data center development project. It is reported that this year, discussions are being refined to focus on the cloud and digital infrastructure sectors.

As Saudi Arabia focuses on fostering AI and data centers as future growth industries, business opportunities are expanding. Market research firm Arizton forecasts that the local data center market will grow at an average annual rate of approximately 20%, rising from $2.08 billion (approximately 2.9 trillion won) in 2025 to $6.17 billion in 2031.

NHC Innovation, Naver’s joint venture partner, is also accelerating its data center business. Last January, it launched “Kuzam Digital Valley” in Riyadh, a hub specializing in data centers and digital technology. The plan is to create a complex equipped with power and telecommunications infrastructure to attract data center and technology companies, as well as investors.

The scope of cooperation between Naver and NHC Innovation has also expanded. Naver Innovation recently signed a memorandum of understanding (MOU) with NHC Innovation at “LEAP 2026,” a global technology event held in Riyadh, to collaborate in the fields of technology and digital infrastructure.

External partnerships necessary for data center construction have also been established. Last April, Naver Cloud formed a strategic alliance with HanmiGlobal Co., Ltd to collaborate on global data center projects, including those in Saudi Arabia. Under this structure, Naver is responsible for technology and service models, while HanmiGlobal Co., Ltd provides support for design and construction consulting, as well as local permits and approvals.

Company executives have also revealed that discussions on these matters have made significant progress. Naver CEO Choi Soo-yeon stated during last month’s second-quarter earnings conference call that the company is “in very concrete discussions” regarding the construction of data centers in the Middle East and cloud-related partnerships.

The business scope is also expanding into sovereign AI. Sovereign AI refers to the concept of controlling and operating data and AI infrastructure within one’s own country. Naver Arabia, Naver’s regional headquarters for the Middle East and North Africa (MENA), features “the sovereign AI cloud currently under construction in Saudi Arabia” on its official website.

Collaboration with local AI companies has also begun. In July, Naver Innovation agreed with the Saudi AI firm MagnaAI to jointly develop sovereign AI infrastructure and security platforms for government and corporate use.

The specific scale and schedule for the data center construction have not yet been finalized. Regarding the progress of the Saudi data center, a Naver Cloud representative stated, “This is still under discussion, and nothing has been decided at this time.”