Saudis Betting Big on A.I.
The kingdom spends its riches to build a tech hub with friends.
RIYADH, Saudi Arabia — One day in March, tech executives, engineers and sales representatives from Amazon, Google, TikTok and other companies endured a three-hour traffic jam as their cars crawled toward a huge conference at an event space in the desert, 80 kilometers outside Riyadh.
The lure: billions of dollars in Saudi money as the kingdom seeks to build a tech industry to complement its oil dominance.
To bypass the congestion, frustrated eventgoers drove onto the highway shoulder, kicking up plumes of desert sand. A lucky few took advantage of a special freeway exit dedicated to “V.V.I.P.s” — very, very important people.
“To the Future,” a sign read on the approach to the event, called Leap.
More than 200,000 people came, including Adam Selipsky, head of Amazon’s cloud computing division, who announced a $5.3 billion investment in Saudi Arabia for data centers and artificial intelligence technology. Arvind Krishna, head of IBM, spoke of friendship. Executives from Huawei and dozens of other firms made speeches. More than $10 billion in deals were done there, Saudi Arabia’s state press agency said.
“This is a great country,” said Shou Chew, TikTok’s chief executive, heralding the video app’s growth in the kingdom. “We expect to invest even more.”
Everybody in tech seems to want to make friends with Saudi Arabia as the kingdom has trained its sights on becoming a dominant player in A.I. — and is pumping in eye-popping sums to do so.
Saudi Arabia created a $100 billion fund this year to invest in A.I. and other technology. It is in talks with Andreessen Horowitz, the Silicon Valley venture capital firm, and others to put $40 billion more into A.I.
companies. In March, the government said it would invest $1 billion in a start-up accelerator to lure A.I. entrepreneurs.
The spending blitz stems from a generational effort outlined in 2016 by Crown Prince Mohammed bin Salman and known as “Vision 2030.” Saudi Arabia is diversifying its oil-rich economy into tech, tourism, culture and sports — investing a reported $200 million a year for the soccer superstar Cristiano Ronaldo and planning a 160-kilometer-long mirrored skyscraper as part of a megacity in the desert.
If Prince Mohammed succeeds in building a domestic tech industry, he will place Saudi Arabia in the middle of a global competition among China, the United States and other countries like France that have made breakthroughs in generative A.I. Combined with A.I. efforts by its neighbor, the United Arab Emirates, Saudi Arabia hopes to create a new power center.
The prince’s ambitions are geopolitically delicate as China and the United States seek to carve out spheres of influence over A.I. In Washington, many worry that the kingdom’s goals and authoritarian leanings could work against U.S. interests — for instance, if Saudi Arabia ends up providing computing power to Chinese researchers and companies.
For China, the Persian Gulf region offers a big market, access to deep-pocketed investors and a chance to wield influence in countries allied with the United States.
Some industry leaders have begun to arrive. Jürgen Schmidhuber, an A.I. pioneer who now heads an A.I. program at Saudi Arabia’s premier research university, King Abdullah University of Science and Technology, recalled the kingdom’s roots centuries ago as a center for science and mathematics.
“It would be lovely to contribute to a new world and resurrect this golden age,” he said. “Yes, it will cost money, but there’s a lot of money in this country.”
Under Vision 2030, new futuristic cities will be built in the desert along the Red Sea, oriented around tech and digital services. When Prince Mohammed visited California in 2018, Sergey Brin, Google’s co-founder, escorted him through the company’s campus. Tim Cook, Apple’s chief executive, showed him the company’s products. The prince also traveled to Seattle, Washington, where he met with Bill Gates of Microsoft; Satya Nadella, the company’s chief executive; and Jeff Bezos of Amazon.
It was a key moment for Saudi Arabia’s tech ambitions as Prince Mohammed presented himself as a youthful, digitally savvy reformer. But enthusiasm dimmed a few months later when Jamal Khashoggi, a Washington Post columnist and critic of the crown prince, was killed at the Saudi Consulate in Istanbul. Prince Mohammed denied involvement, but the C.I.A. concluded that he had approved the killing.
For a brief period, it was seen as untoward to associate with Saudi Arabia. Business executives canceled visits. But the lure of its money was ultimately too strong.
A.I. development depends on two key things that Saudi Arabia has in abundance: money and energy. The kingdom is pouring oil profits into buying semiconductors, building supercomputers, attracting talent and constructing data centers powered by its plentiful electricity. The bet is that Saudi Arabia will eventually export A.I. computing muscle.
Some question whether Saudi Arabia can become a global tech hub. The kingdom has faced scrutiny for its human rights record, intolerance toward homosexuality and brutal heat. But for those in the tech world who descended on Riyadh in March, the concerns seemed secondary to the dizzying amount of deal-making underway.
“They are just pouring money into A.I.,” said Peter Lillian, an engineer at Groq, a U.S. maker of semiconductors that power A.I. systems. Groq is working with Neom, a futuristic city that Saudi Arabia is building in the desert, and Aramco, the state oil giant. “We’re doing so many deals,” he said.
King Abdullah University of Science and Technology, situated along the Red Sea’s turquoise waters, has become a site of the U.S.-Chinese technological showdown.
The university, known as KAUST, is central to Saudi Arabia’s plans to vault to A.I. leadership. Modeled on universities like the California Institute of Technology, KAUST has brought in foreign A.I. leaders and provided computing resources to build an epicenter for A.I. research.
To achieve that aim, KAUST has often turned to China to recruit students and professors, alarming American officials. They fear students and professors from Chinese military-linked universities will use KAUST to sidestep U.S. sanctions and boost China in the race for A.I. supremacy, analysts and U.S. officials said.
Of particular concern is the university’s construction of one of the region’s fastest supercomputers, which needs thousands of microchips made by Nvidia, in Santa Clara, California, the biggest maker of precious chips that power A.I. systems. The university’s chip order, with an estimated value of more than $100 million, is being held up by a review from the U.S. government, which must provide an export license before the sale can go through.
Both China and the United States want to keep Prince Mohammed close. A.I. ambitions add a new layer of geopolitical significance to a kingdom already key to Middle East policy and global energy supplies. Chinese companies have expanded rapidly in the kingdom, forming partnerships with major state-owned companies. The United States has pushed Saudi Arabia to pick a side, but Prince Mohammed seems content to benefit from both nations.
Mr. Schmidhuber has seen the jostling up close. Considered a pioneer of modern A.I. — students in a lab he led included a founder of DeepMind, an innovative A.I. company now owned by Google — he was lured to the desert in 2021.
He was reluctant to move at first, he said, but the university “tried to make it more attractive and even more attractive and even more attractive for me.”
Now Mr. Schmidhuber is awaiting the completion of the supercomputer, Shaheen 3, which is a chance to attract more top talent to the Persian Gulf and to give researchers access to computing power often reserved for major companies.
“No other university is going to have a similar thing,” he said.
Still, Mr. Schmidhuber said the Saudi government was ultimately aligned with the United States. Just as U.S. technology helped create Saudi Arabia’s oil industry, it will play a critical role in A.I. development.
“Nobody wants to jeopardize that,” he said.