Amazon Web Services (AWS) unexpectedly announced earlier this week the launch of its Israel cloud region, which will enable it to meet its commitments in the Nimbus government cloud tender.
To provide the service, AWS pledged to build three large active data centers totaling 16 megawatts at Tnuvot in the Sharon region, Shoham and the Har Tov industrial park near Beit Shemesh.
AWS this week launched most of its services through the local cloud region including storage, backup and remote connection - but "Globes" has learned that the launch was somewhat limited and will only use about 25% of the potential of each data center. In the first stage, only about 4 megawatts in the three data centers will operate, and the service will gradually increase according to demand.
AWS is launching a limited number of services in Israel compared with the range of services it provides in other regions of the world. According to a check on its website, it seems the number of services offered in the Israeli cloud region is the lowest in the world: only 65 cloud services.
In the UAE, for example, AWS offers 99 different services, and in South Africa and Bahrain - 132 services in each of the countries. Spain gets 89 services, Sweden and Brazil 157 each. In the western US, Amazon offers 160 different services, while Singapore has 200 different services.
AWS has only just launched services in Israel and over time it will offer a higher number of services - but this indicates that Amazon preferred to launch the Israel region at an earlier date over a later launch with a more extensive level of services.
As part of the supply of public cloud services in Israel, in 2021 the Nimbus tender winners promised the Ministry of Finance Accountant General to build service areas in Israel to store and process the data on local servers, rather than in Europe or the US, in order to meet the security, financial and medical regulatory requirements of various organizations in Israel.
In order to launch a service area, AWS and Google Cloud committed to building at least two data centers at least 25 kilometers apart but connected to one network, to avoid a situation in which a disaster or war prevents one data centerfrom operating.
As the main winner of the Nimbus tender, responsible for 70% of the volume of the project, AWS committed to build the largest number of data centers and provide the largest range of services. It has not been easy. AWS tried to implement its construction methods worldwide in Israel and even hired Compass, formerly a subsidiary of Azrieli, which it had never worked with before.
The result was a series of delays and technical problems that arose in the construction of the three data centers. During the construction of the data centers by Compass and its partner in Israel, Excite, technical problems were discovered in the installation of the electrical and cooling systems, and the sites often replaced Israeli suppliers with foreign ones in order to solve the problems.
AWS had to announce a delay in the launch of the cloud service region from the first half of 2023 to the third quarter of this year. Tuesday's announcement was believed to have been made on the last date on which AWS was obliged to launch the service in Israel. It was differences of opinion between Azrieli and Compass on the project in Israel that contributed to Azrieli's decision to sell its share in the company for a profit of NIS 1.3 billion.
What about Microsoft
AWS is not the only one data center services provider in Israel. Although Google Cloud already launched its service almost a year ago thanks to the quick approval of the construction of the data center in Bnei Zion, which was controversial, the activities of another major player in the cloud market remains a mystery. Microsoft, which did not win the Nimbus tender, promised back in 2021 that a data center and service region in Israel would be operating by 2022.
Today, four months before the end of 2023, Microsoft has not yet launched its service region, despite the fact that it has won a huge tender with Ness Technologies to supply cloud services worth NIS 150 million, one of the requirements of which is an Israeli cloud region.
Even before its failure to win the Nimbus tender in April 2021, Microsoft committed to renting extensive areas in Sheinfeld Engineering's data center in Modi'in's Ligad industrial zone, and the same company's small data center in Petah Tikva, an old facility that was renovated for the benefit of the activity.
Despite losing out, Microsoft pledged that it would continue to strive to build a service region in Israel to serve banks, insurance companies, hospitals, health funds and security organizations. "Globes" has learned that Microsoft has signed agreements to build additional server farms in Shoham and Or Yehuda, with a total volume of 25 megawatts.
Only recently, after several electrical technical problems, Microsoft began conducting internal trials in operating an Israel service region, which is expected to be fully launched in the coming weeks, two years later than scheduled. No response was received from Microsoft and AWS.
Published by Globes, Israel business news - en.globes.co.il - on August 3, 2023.
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