Oracle has pulled ahead of Amazon, Microsoft, and Google in a quiet but consequential competition: building the air-gapped cloud system Japan needs to share top-secret intelligence with the United States and its allies.
According to seven people familiar with talks between the companies, Tokyo, and Washington, Japan settled on wanting a US cloud provider after months of discussions and a March conversation between President Trump and Prime Minister Sanae Takaichi. The push traces back to longstanding US frustration that Japan’s cybersecurity infrastructure remains, as one person close to the talks put it, “in the dark ages,” particularly vulnerable to Chinese hacking at a moment when Washington wants Tokyo building weapons alongside it and deterring Beijing more aggressively.
There’s also a bigger prize on the table. US officials reportedly believe stronger cyber defenses could help Japan eventually join Five Eyes, the intelligence-sharing alliance currently limited to the US, UK, Australia, New Zealand, and Canada. Separately, Japan’s plans to co-develop a next-generation fighter jet with the UK have added pressure to build infrastructure secure enough to handle classified data sharing.
Air-gapped clouds, kept physically disconnected from the internet and accessible only through specialized secure gateways, are considered the gold standard for this kind of work. Oracle reportedly moved early to signal it would deliver that level of security, while Microsoft and AWS, despite having extensive experience building air-gapped systems elsewhere, pushed back on the idea that Japan needed one at all, arguing commercial-grade alternatives would suffice. AWS disputed this account directly, telling the Financial Times its reporting was “wrong” and that it does offer fully air-gapped solutions for classified work.
Japan hasn’t finalized anything yet. Officials could still split the contract, or build the air-gapped system first and layer in commercial cloud services later for less sensitive data. Critics of the air-gapped approach point to its cost and the years it would take to build new data centers on Japanese soil, facilities that would also become obvious targets in any future conflict with China.
There’s a deeper unease running underneath the technical debate too. Japanese officials have voiced concern about depending so heavily on a single American company, especially after the Trump administration briefly blocked Anthropic from exporting its Mythos AI model, an episode that left some in Tokyo questioning how reliable US tech commitments really are.
