Israel Cloud Object Storage Market Size and Forecast by Storage Type, Deployment Model, Industry, Organization Size, Use Case, and Pricing Model: 2019-2033

Israel Cloud Object Storage Market Outlook

Israel cloud object storage market is undergoing a profound transformation, marked by rapid infrastructure expansion, state-backed cloud migration projects, and the rising adoption of AI-driven data management. As per David Gomes, Manager – ICT, the market is projected to grow at a CAGR of 11.8% from 2025 to 2033, driven by national digitization efforts and the increasing need for sovereign, high-performance storage solutions.

Amazon Web Services (AWS), in a landmark move, announced a $7.2 billion investment through 2037 to develop a local cloud data region, contributing an estimated $13.9 billion to Israel’s GDP while generating over 7,700 jobs annually. This project supports AWS’s growing ecosystem of government, startup, and enterprise customers in Israel, anchoring its role in the country's broader technological evolution. Similarly, Google Cloud’s Tel Aviv region—part of the $1.2 billion government-led Nimbus initiative—is expected to contribute $7.6 billion to GDP and create over 21,000 jobs by 2030, further solidifying Israel's status as a cloud-first nation.

Local innovation is equally driving market momentum. Israeli startup CTERA has emerged as a key player in hybrid cloud file storage. Leveraging a distributed architecture and AI-integrated management, CTERA supports mission-critical workloads across banking, healthcare, media, and public sectors. With $80 million in recent funding from PSG Equity and a track record of recognition in GigaOm’s Distributed File Storage Radar, CTERA’s approach resonates with the shift toward secure, sovereign storage that meets regulatory and latency-sensitive demands. The trend toward hybrid cloud is also accelerating, with adoption rates expected to triple from 20% in 2023 to 60% in 2027, reflecting a growing need for operational agility and resilience.

Adding to the momentum is Weka, an Israeli unicorn valued at $1.6 billion. Specializing in AI-native data infrastructure, Weka’s platform supports high-performance computing and large-scale generative AI workloads across multi-cloud environments. Backed by Nvidia, Hitachi Ventures, and Qualcomm, Weka exemplifies how Israel is translating its deep-tech pedigree into globally scalable cloud object storage solutions. Notably, their clientele includes Stability AI and several Fortune 50 companies, reinforcing their role in AI-enabled data operations.

Despite these developments, challenges around cybersecurity and geopolitical uncertainty persist. Many Israeli firms still host data abroad, citing risks of missile attacks and data sovereignty concerns. This dynamic has led to unique infrastructure solutions, such as MedOne’s underground, missile-resilient data centers that proved vital during recent conflicts. These ultra-redundant facilities, connected directly to submarine cable landing stations, offer unmatched uptime and strategic latency advantages from Tel Aviv to global cloud hubs. During the October 7 cyber surge, MedOne’s centers remained fully operational, showcasing real-world proof of concept for resilient storage infrastructure.

Project Nimbus—an ambitious cloud-first transformation initiative spearheaded by the Israeli government—has appointed Amazon and Google as official providers, emphasizing domestic cloud data residency, enhanced compliance, and operational independence. The long-term contracts, spanning up to 23 years, will support ministries, defense organizations, and healthcare institutions. Google’s additional commitment to workforce training for public sector digital literacy exemplifies how infrastructure and human capital investments go hand-in-hand to sustain cloud adoption.

Israel cloud object storage ecosystem is being reshaped by a confluence of international investment, local innovation, and regulatory foresight. For enterprises, investors, and public institutions, the landscape offers both opportunity and complexity. Strategic infrastructure planning, compliance-ready architectures, and AI-native capabilities are now core criteria for success in this high-growth, high-stakes market.

Authors: David Gomes (Manager – IT)

*Research Methodology: This report is based on DataCube’s proprietary 3-stage forecasting model, combining primary research, secondary data triangulation, and expert validation. [Learn more]

Israel Cloud Object Storage Market Scope