- Saudi Arabia could swap residential projects for industrial and AI projects
- Desert nation invests heavily in GPUs for state-backed AI facilities
- Coastal access offers potential seawater cooling for desert data centers
The Neom project in Saudi Arabia, known as “The Line”, was initially described as a linear urban development stretching approximately 170km across the desert.
The concept envisioned a linear city with extreme density, automated mobility and renewable energy that would accommodate 9 million residents within its narrow footprint.
However, reports now suggest officials are reconsidering that view after internal reviews revealed delays, rising costs and wider budget pressure – and sources cited by the Financial Times They say the revised plan could abandon large-scale residential ambitions in favor of much smaller industrial use.
Focus on AI infrastructure and data centers
In this context, planners would view the site as a large-scale cloud hosting and data center platform designed to support compute-intensive workloads.
It will likely prioritize high-density server deployments for AI training and inference, rather than housing or urban services.
Some accounts suggest that operators would favor bare metal infrastructure to maximize performance and efficiency of use.
Saudi Arabia has recently accelerated its investments in AI capabilities, including acquiring thousands of advanced GPUs for state-backed facilities.
However, Saudi Arabia’s climate poses a well-known challenge to data center operations, particularly given persistently high temperatures and limited availability of fresh water.
Independent research has identified the country as one where most existing data centers operate in areas considered inefficient in terms of cooling.
But The Line’s coastal access to the Red Sea offers a practical advantage, with planners proposing seawater cooling as a mitigation strategy.
Similar projects, such as xAI’s Colossus in Memphis, have come under scrutiny after satellite verifications suggested limits in available electricity or cooling capacity for AI systems.
It is not yet clear whether the scaled-down data center will reach full capacity, but Saudi Arabia has opted to suspend The Line in favor of a smaller plan.
The desert nation faces a liquidity crunch after years of expansive public spending, while falling oil revenues and competing commitments like the Expo and the 2034 World Cup add to the pressure.
Neom did not directly challenge claims of narrow scope, instead emphasizing progressive development and alignment with national priorities.
This approach suggests flexibility rather than a firm commitment to the initial scale or schedule.
Observers note that similar adjustments have already taken place in other Saudi megaprojects.
But without a clear reaffirmation of the original plan, speculation is growing that the linear city model may no longer be central to Neom’s short-term strategy.
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