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Oracle inaugurates regional cloud center in Jerusalem, plans to open 2nd site

Data center set up in underground facility of thousands of square meters over four floors

Ricky Ben-David is The Times of Israel’s Startups and Business editor and reporter.

From left: Communications Minister Yoaz Hendel, Jerusalem Mayor Moshe Lion, Eran Feigenbaum, country manager, Oracle Israel, and Economy Minister Orna Barbivai attend the inauguration of Oracle's new cloud center region in Jerusalem, October 13, 2021. (Ezra Levy)
From left: Communications Minister Yoaz Hendel, Jerusalem Mayor Moshe Lion, Eran Feigenbaum, country manager, Oracle Israel, and Economy Minister Orna Barbivai attend the inauguration of Oracle's new cloud center region in Jerusalem, October 13, 2021. (Ezra Levy)

Tech giant Oracle on Wednesday inaugurated its new underground data center in Jerusalem, which will function as a regional cloud provider for Israeli clients, and announced plans to launch a second center in the country.

“Companies and government entities need to move to [the] cloud quickly, and Oracle’s new underground cloud region in Jerusalem makes that possible,” said Oracle CEO Safra Catz at the event, also attended by Israeli Economy Minister Orna Barbivai, Communications Minister Yoaz Hendel, and Jerusalem Mayor Moshe Lion.

“This Oracle Cloud region will bring all the cost, performance and security benefits of Oracle Cloud to the State of Israel today — not next month or next year,” added Catz.

The second data region is part of Oracle’s dual-region strategy and “will provide customers with even stronger business continuity and disaster recovery capabilities, as well as ensuring that all their data remains within Israel,” the company said in a statement Wednesday.

Globally, the data centers tap into Oracle’s overall plan to set up 38 cloud regions worldwide by the end of 2021. Last November, Oracle opened a cloud data center in Dubai.

Oracle’s plans to open a second cloud region in Israel “is demonstrative of our continued commitment to the State of Israel,” said Eran Feigenbaum, country manager of Oracle Israel. “We worked to provide Israel with the first cloud from any major cloud vendor and now we are planning a second region, which will enable more customers to benefit from the complete set of cloud services Oracle offers and improve disaster recovery.”

Safra Catz, Oracle’s CEO and Alon Ben Zur, CEO, Bynet Data Communications in Jerusalem; July 8, 2021 (Ezra Levy)

The inauguration Wednesday makes Oracle the first global cloud vendor to have an operational cloud region in the country. The center is set up together with Bynet Data Communications on its server farm in Jerusalem, spreading across an underground facility of thousands of square meters, over four floors, and at a depth of 50 meters (160 feet) below ground level.

The new data center will provide advanced cloud services to companies in a variety of sectors — defense, government, banks, insurance companies, infrastructure, technology and retail.

“The establishment of the first public cloud in Israel, specifically in Jerusalem, will contribute to the further development of the city’s technology,” said Lion, the mayor, in February when the plans were announced. “This is truly an IT revolution.”

In April, Oracle, Microsoft, and IBM lost a bid to Amazon and Google to build and provide cloud-based regional data centers and services to government entities, ministries, and units, as part of a NIS 4 billion government tender. The cloud-based data centers are meant to give these institutions improved access to servers, storage, databases, and application services.

The provider of such cloud services will need to set up an Israel-region data center that “will meet the security, durability and operational continuity requirements” of the nation, the Finance Ministry said late January. Furthermore, the local infrastructure will have to be “operational completely separately from the public-cloud services provided by the provider in any other region in the world.”

The winners of the tender, Google and Amazon, signed contracts in May to launch the cloud data centers in Israel in the next two years approximately.

This undated photo made available by Google shows colorful pipes sending and receiving water for cooling Google’s data center in The Dalles, Oregon (photo credit: AP/Google, Connie Zhou)

Until the data centers are built locally, cloud services will be provided by Google and Amazon AWS data centers in Ireland, Holland, and Frankfurt. All of that data will then be transferred to the ones set up in Israel.

The cloud project, called the Nimbus, is one of Israel’s biggest information technology projects and envisions six data centers. It will enable government ministries and other public entities to transfer servers and services into the cloud that will be set up by the winning firms.

All of the multinationals had offered their services to build data centers and provide cloud services to local public entities, with all of the data secured within the borders of Israel under strict security guidelines and under Israeli law. The Israeli employees will have to pass security clearances.

This week, several hundred anonymous workers at these companies penned an open letter decrying the agreements and urged their employers to “cut all ties with the Israeli military.”

Earlier this year, amid fighting between Israel and Gaza-based terror groups, Google employees asked management to review the company’s contracts with and corporate donations to “institutions that support Israeli violations of Palestinian rights,” citing the Israel Defense Forces as an example of such an institution.

The Nimbus project is divided into four parts with four separate tenders: to provide cloud services to the government on a public platform – won by Google and AWS (Amazon Web Services); to help set out a government strategy to move operations to the cloud; to provide technical help in implementing the move; and an as-yet unpublished one to provide optimization services for use of the cloud.

Consultants KPMG were the winners of the second tender, and will help set up a Cloud Center of Excellence, which will help set out government strategy to move activities to the cloud. They contended against Ernst & Young, McKinsey and HPE, the Finance Ministry said in April.

Separately, Microsoft recently announced that it will open five new R&D sites across Israel and hire 2,500 more people.

Shoshanna Solomon contributed to this report.

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