The data center industry in Israel is experiencing significant growth. Over the last two years, an increasing number of these centers have been set up over expansive areas. Housing local data within Israel's sovereign territory under legal regulations highlights the industry's critical role in national security and resilience. This perspective aligns with other developed countries, which until recently depended on data centers situated outside their borders.
Local data centers provide several benefits, including safeguarding sensitive national and business data, enabling rigorous security policies, and offering control without external dependencies. Storing data within national boundaries subjects it to local laws and regulations, thereby minimizing legal risks. Additionally, local data is less susceptible to international conflicts, geopolitical strife, and foreign interference.
Israeli data centers, including those established by global cloud service providers, already offer many of these advantages. Israeli regulators have mandated that even secondary and tertiary copies of data files must also be stored within Israel. However, there are noticeable gaps in both policy and implementation, undermining national security and impeding the full realization of these benefits.
Firstly, surface-level or standard durability facilities in Israel remain vulnerable to missile attacks. Such vulnerabilities could jeopardize the continuous operation of various essential services, like government functions and banking, especially during emergencies. Investing in high-security underground construction, compliant with the Tier IV international standard as defined by the Uptime Institute, is imperative. This type of construction ensures uninterrupted operations and safeguards against military threats, such as direct missile attacks.
Israel has global expertise in subterranean development, using natural caves for security purposes. This proficiency can significantly contribute to upgrading local data center security.
Moreover, Israel must diversify its energy sources to bolster resilience, both during crises and regular operations. Many data centers globally are incorporating solar panels and other alternative energy sources into their external security walls. Israeli regulators should swiftly approve similar initiatives to enhance the robustness of data centers.
Israel must adopt a strategic, long-term outlook towards the hi-tech industry, treating it as an integral part of national security and resilience planning. The accelerating growth in artificial intelligence processing will result in a critical data center space shortage within two to four years, posing economic risks. A comprehensive national plan, complete with demand forecasts and budget allocation for construction and closing the existing gaps, is essential.
Lastly, this plan should also eliminate market barriers and incorporate effective public-private partnership (PPP) models, as demonstrated in projects like Highway 6, the Basic Training City, and the IDF's Communications City. These partnerships can expedite the development of data centers, cementing their role as key components of national security and resilience. Israel already possesses the necessary knowledge and capabilities; what remains is the decision to implement them in the data center industry.
Written by Gad Benett, CEO and Co-Founder of the data center company Techtonic.