Iranian drone strikes on AWS data centers in the UAE and Bahrain are giving Chinese cloud rivals an opening in the Gulf

Iranian drones struck three AWS data centers in the UAE and Bahrain on March 1, the first confirmed military attack on a hyperscale cloud provider, disrupting services across banks, fintech platforms, and ride-hailing apps and prompting Huawei Cloud to publicly pitch “multi-cloud” resilience to Gulf clients as an alternative to single-provider dependency. Experts say the attacks could shift how Gulf governments assess cloud providers, with Chinese firms potentially seen as more stable alternatives if the conflict persists, though analysts note Chinese providers are more likely to gain traction as secondary or backup options for non-critical workloads rather than primary infrastructure. The dynamic is complicated by the fact that Gulf states largely pivoted away from Chinese AI companies to strengthen ties with Washington, and that the region's data center market is projected to nearly triple to around $9.5B by 2030 as Saudi Arabia and the UAE invest heavily in their own AI infrastructure.