Oracle is at the forefront of efforts to establish an air-gapped cloud for Japan.

      Oracle is at the forefront of developing an air-gapped cloud for Japan, isolated from the internet, as a response to concerns over Chinese hacking. Washington wants Japan to secure its systems before sharing more sensitive information. According to the Financial Times, Oracle has outpaced Amazon, Microsoft, and Google in the race to provide the Japanese government with this secure cloud solution. An air-gapped system separates itself completely from external access, ensuring that the most confidential data remains off the public internet.

      The motivation behind this initiative is security, along with Larry Ellison's strong connections to Donald Trump. Following this news, Oracle's stock prices increased.

      The impetus comes from the threat posed by China. The U.S. has been urging Japan for years to strengthen its cyber defenses against Chinese cyberattacks, and this urgency has escalated as both nations enhance their collaboration on military matters and strategies to deter Beijing.

      A secure government cloud is intended to foster trust between allies, enabling the U.S. and its partners to share sensitive information with Tokyo without the risk of data breaches. Ultimately, this could lead to Japan's closer integration into allied intelligence networks, including the Five Eyes.

      However, no decisions have been made yet; the Financial Times reports that Tokyo is still considering its options and could potentially distribute the project among various vendors.

      The deal reflects a broader trend of governments seeking sovereign clouds that they can control, rather than relying on foreign-operated platforms. Recently, the U.K. designated American cloud services as essential to its financial system.

      Oracle is capitalizing on this sentiment, with its executives contending that the key aspect is data control rather than the operational model, as clients prioritize authority over their data's location.

      The market is becoming increasingly competitive. Defense budgets are attracting tech companies, with the Pentagon recently halting a cyber-audit requirement, and European labs like Finland's NestAI developing military-grade cloud systems for national ownership.

      For Oracle, securing this deal with Japan would be a significant achievement, while for Washington, it represents a step toward strengthening ties with an important ally. Establishing the secure vault is the priority, with the sharing of secrets to follow.