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2 Feb, 2018 02:05

Google's parent company in talks to build massive data hubs in Saudi Arabia – report

  Google's parent company in talks to build massive data hubs in Saudi Arabia – report

Alphabet Inc. is reportedly negotiating a major deal with Saudi Arabia. The tech giant recently cracked down on RT in the name of democracy, but seems to be OK with Riyadh’s systematic human rights violations, at home and abroad.

Senior executives of Alphabet, which owns Google, have reportedly been negotiating “for months” with representatives of the Saudi state oil giant Aramco, as well as Saudi government officials, including Crown Prince Mohammed bin Salman, the Wall Street Journal (WSJ) reports. The potential deal envisages Alphabet building major data centers in the Kingdom.

Details of the project remain scarce, including the date when the agreement will be finalized, the purpose of the tech hubs and who would control them. Sources familiar with the developments told the WSJ, however, that the size of the potential joint venture could be big enough to list on Saudi Arabia’s stock exchange.

Google is behind both Amazon.com Inc. and Microsoft Corp. in the business of renting computing power and online storage. The deal might secure a foothold in Saudi Arabia, which could be crucial for outflanking their rivals and attracting local wealthy oil-industry customers.

Amazon, meanwhile, is also seeking to carve out a space in the potentially lucrative market. The company is reported to be close to finalizing a $1 billion deal, which also involves building three data centers in Saudi Arabia.

Alphabet recently ‘championed democracy’ with a crackdown on RT. Citing “RT’s relationship with the Russian Government,” Google said it’s “working on disclosures to provide similar transparency on YouTube,” apparently to better inform its customers about “malicious Russian propaganda.”

In November, Eric Schmidt, the Executive Chairman of Alphabet, said the company is working on de-ranking RT and Sputnik to make their articles less prominent on Google’s news delivery services. The move is also in the name of ‘democracy.’

In a letter sent to the US Senate Intelligence Committee in January, Google’s VP and general counsel Kent Walker said Google took RT out of its Preferred Lineup on YouTube. It added that ads from Russian news media outlets remain subject to “strict ads policies and community guidelines” in an apparent attempt to show that ‘Russian money’ would not seduce the company into betraying its commitment to democratic values.

Saudi money, it appears, is another matter. Alphabet CEO Larry Page has reportedly been engaged in month-long talks with the Saudis about a future deal.

Long time US ally Saudi Arabia does not exactly boast a stellar record on human rights and democratic governance principles, with its military campaign in neighboring Yemen repeatedly coming under fire from human rights organizations and even the UN.

The Saudi-led coalition has been waging a campaign against Shia Houthi rebels in Yemen since March 2015 in an attempt to propel ousted president Abdrabbuh Mansur Hadi back to power. The war effort and the blockade of Yemen have since led to a humanitarian catastrophe, with an estimated two million children starving. Recent Human Rights Watch estimates say some two million children are malnourished and nearly 16 million people lack access to clean water.

Saudi Arabia's internal policies are also not a beacon of democracy. Human rights activists have repeatedly accused the Kingdom of using torture to extract confessions from suspects, as well as setting up secret courts to issue death sentences. Riyadh’s practices even made their friends in Washington uncomfortable.

A 2016 US State Department report said that Saudi Arabia “lacks a written penal code listing criminal offenses and the associated penalties for them, punishment- including the imposition of capital punishment, is subject to considerable judicial discretion in the courts.”

“The government also imposes death sentences for crimes committed by minors,” it added. Saudi Arabia carried out at least 154 death sentences in 2016, ranking among the world's top five executioners.

None of this seems to have fazed democracy-loving Alphabet from doing business with Riyadh. Fighting "Russian propaganda" seems to be a much safer bet in terms of lost profits and scoring prestige points with Washington, after all.