By 2026, the Center East’s know-how market will probably be formed by a convergence of synthetic intelligence (AI), cyber safety and large-scale infrastructure funding, towards a backdrop of robust, although uneven, regional development.
In keeping with Omdia, world know-how spending is predicted to develop by 10.2% year-on-year in 2026, surpassing the US$6tn mark. Whereas the Center East is predicted to develop at a barely slower tempo of seven.94%, this can nonetheless propel the regional market to US$174.9bn, underscoring its strategic significance.
“The dual forces of AI and cyber safety will proceed to play an enormous function throughout the Center East within the subsequent 12 months,” mentioned Trevor Clarke, chief analyst at Omdia. “These actually are the most important points influencing technique and spending. Each of them are tendencies in their very own proper, but additionally deeply built-in with all the opposite ways in which we use know-how.”
AI turns into a foundational enterprise layer
One of the vital vital shifts anticipated in 2026 is the evolution of AI from a supplementary device right into a core enterprise platform. Organisations throughout the area are transferring past pilots and proofs of idea in the direction of scaled, production-grade deployments.
“AI is quickly evolving from a supplementary device to a foundational enterprise layer,” mentioned Clarke. “We count on continued efforts to be ‘AI match’, but additionally a a lot stronger embrace of AI platforms and instruments as core enterprise platforms.”
Crucially, a lot of this progress will occur out of public view. Relatively than consumer-facing purposes, Clarke factors to agentic AI embedded into particular enterprise processes throughout authorities, finance and power.
“We’re beginning to see a shift from exploration and experimentation into manufacturing and scaled deployments,” he mentioned. “That is already taking place throughout all industries, together with authorities, finance and power.”
From digital to bodily: AI meets IoT
One other defining pattern for 2026 is the rising convergence of AI with the bodily world, pushed by the web of issues (IoT), robotics and edge computing.
“Synthetic intelligence gives highly effective reasoning and prediction capabilities however is restricted with no connection to the bodily world,” mentioned Clarke. “IoT offers that bridge, giving AI the sensors and actuators it must see, perceive and act in actual time.”
The dual forces of AI and cyber safety will proceed to play an enormous function throughout the Center East within the subsequent 12 months. These actually are the most important points influencing technique and spending Trevor Clarke, Omdia
Omdia’s enterprise IoT analysis exhibits that 34% of organisations already use AI and machine studying of their IoT deployments, whereas 44% cite it as a precedence for the long run. This mix is predicted to speed up the adoption of bodily AI throughout industries resembling power, utilities, transport and good cities.
Underpinning all of this can be a wave of capital funding in AI-ready infrastructure. Datacentres have gotten crucial nationwide belongings as demand for AI compute continues to surge.
“Datacentres constructed for the AI period have gotten crucial infrastructure,” mentioned Clarke. “They’re wanted to develop, deploy and run the AI workloads which are altering our lives.”
Hyperscalers, telecoms operators and rising “neocloud” suppliers are all increasing capability throughout the area, intensifying competitors to grow to be the dominant AI platform. Nonetheless, this development brings new challenges round energy consumption, water utilization and sustainability – points that can more and more affect know-how technique.
Cyber safety strikes from static defence to adaptive resilience
As AI adoption accelerates, cyber safety priorities are shifting simply as quickly. Attackers are already utilizing AI to boost ransomware and phishing campaigns, elevating the stakes for organisations working crucial infrastructure.
“As AI is harnessed by attackers for extra adaptive ransomware and phishing campaigns, the stakes have by no means been larger for safety groups,” warned Clarke.
In response, organisations are transferring away from static safety postures in the direction of adaptive, AI-enabled frameworks. “Companies will leverage distinctive combos of machine studying, generative and agentic AI as complementary and foundational capabilities, reasonably than add-on parts,” he mentioned.
On the identical time, the convergence of IT and operational know-how (OT), mixed with the rise of bodily AI, is increasing the assault floor. Clarke additionally highlights a rising human price: “We see burnout amongst cyber safety groups persevering with to worsen as a consequence of an intensified menace panorama.”
Sovereign AI is rising as a strategic precedence, significantly for governments and important industries, though definitions stay fluid. “We don’t but have an business commonplace for what ‘sovereign AI’ actually represents,” mentioned Clarke. “However we’re seeing methods being influenced by sovereignty considerations, particularly the place nationwide AI methods have been outlined.”
These efforts span infrastructure possession, mannequin growth and abilities growth. Nonetheless, Clarke cautions that the important thing threat is tempo.
“One of many challenges to observe is whether or not investments throughout the area can sustain with what’s successfully a world innovation speedrun,” he mentioned. “The important thing will probably be pace and adaptableness to vary.”
Cloud growth will proceed throughout the Center East in 2026, however Clarke believes the last word winners will probably be decided much less by scale alone and extra by ecosystem energy.
“One of many greatest components within the success of cloud platforms is the channel associate group,” he mentioned. “The higher and extra worthwhile the channel and the cloud suppliers make one another, and assist prospects achieve success, the larger the function the platform will play.”
Consequently, Clarke recommended that regional channel companions will probably be a key indicator of which cloud platforms emerge as probably the most influential in 2026.
Which rising applied sciences will repay?
Amongst rising applied sciences, Clarke sees agentic AI and edge computing delivering probably the most rapid industrial worth, significantly together with robotics and bodily AI. Nonetheless, he expects advantages to be inconsistently distributed. “There will probably be winners and losers,” he mentioned. “And the massive winners will probably be concentrated in quantity.”
Digital twins are maturing however stay area of interest for now, whereas quantum computing readiness, significantly amongst telcos, will proceed to realize consideration with out having a fabric financial impression in 2026.
Lastly, the expertise panorama is getting into a interval of uncertainty. Whereas demand for AI, information engineering and cyber safety abilities stays excessive, the rise of AI brokers might reshape recruitment fashions.
“One of many massive elephants within the room is whether or not employers will proceed the identical stage of recruitment or discover AI brokers extra aggressively,” mentioned Clarke. “This equation just isn’t but answered, however we are going to see extra proof in 2026.”
As AI brokers enhance, organisations might shift from hiring full-time employees to orchestrating hybrid groups of people and machines, a transition that might make entry into the job market tougher for brand new graduates.
Though particular regulatory outcomes stay unsure, Clarke expects AI and cyber safety coverage to be carefully watched by enterprise leaders. “Earlier expertise has proven that compliance and governance could be very demanding,” he mentioned.
Governments, in the meantime, will proceed to make use of regulation to mitigate dangers whereas maximising the advantages of AI, significantly the place it underpins nationwide infrastructure and financial resilience.
In 2026, the Center East’s know-how agenda will probably be outlined not simply by how briskly it adopts AI, however by how securely, sustainably and strategically it builds the foundations beneath it.
