AI Vendor Lock-In Emerges as the Next Enterprise Risk in the UAE: IBM Study
Nearly nine in 10 surveyed UAE executives said switching their primary AI vendor or foundation model would be difficult today.
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[Image: Nomita Samaiyar/MITSMR Middle East]
With artificial intelligence moving from pilot projects into mission-critical operations, a new study suggests the next competitive challenge may not be deploying AI faster but controlling it.
Research from the IBM Institute for Business Value finds that most organizations have become deeply dependent on their AI vendors, creating operational, regulatory, and strategic risks that are increasingly difficult to manage as AI becomes embedded across core business functions. The study, The Calculus of AI Sovereignty, surveyed 1,000 senior executives globally, including respondents from the UAE, and found that AI sovereignty is an emerging business priority.
The findings reveal that enterprises are building increasingly sophisticated AI environments while simultaneously losing flexibility. Nearly nine in 10 surveyed UAE executives (88%) said switching their primary AI vendor or foundation model would be difficult today. Meanwhile, 74% reported that complying with data residency and sovereignty requirements across different jurisdictions remains a significant challenge, limiting their ability to move AI workloads or data between environments.
The operational consequences are already becoming visible.
Surveyed UAE executives reported experiencing an average of seven AI-related disruptions over the past two years, many linked to vendor services. Yet despite those experiences, 84% said a week-long outage at their primary AI vendor would cause severe or critical disruption to business operations. Almost all respondents (96%) also acknowledged they lack a complete understanding of their organization’s dependencies across AI models, vendors, and infrastructure, making it difficult to assess operational risk or prepare contingency plans.
“The UAE has created one of the world’s most ambitious environments for AI innovation,” said Shukri Eid, General Manager for IBM Gulf, Levant, and Pakistan. “As organizations move from experimentation to enterprise-wide deployment, success will increasingly depend on their ability to retain control over their AI ecosystem.”
IBM argues that organizations that can adapt their AI infrastructure, models, and data across multiple environments are gaining measurable operational advantages. According to the research, companies with the strongest AI control capabilities experience less downtime and protect 55% more operating profit from AI-related disruptions than their peers. However, only 7% of surveyed organizations globally currently operate at that level of maturity.
Interestingly, vendor diversification alone does not appear to solve the problem. Although 82% of surveyed UAE organizations describe their AI environments as intentionally multi-vendor, migration remains difficult. Eighty percent of executives said moving core AI systems to another provider would take at least six months, while transferring AI training and operational data would require an average of 150 days.
The willingness to preserve flexibility also carries a financial dimension. More than three-quarters (78%) of surveyed UAE executives said they would accept a 20% increase in AI-related costs if doing so improved their strategic flexibility.
The findings suggest that as enterprises scale AI across critical operations, competitive advantage will increasingly depend on the ability to reduce dependency on any single provider.
