Israel's $1.2 bn Nimbus deal asked Google, Amazon for 'secret data codes'

The Nimbus agreement is a key Israeli initiative to move government and military data into private cloud centers, with leaked files revealing a covert 'winking' data alert system

In 2021, tech giants Google and Amazon reportedly entered a $1.2 billion cloud-computing contract with the Israeli government, known as the Nimbus Agreement. According to The Guardian, leaked documents reveal that the deal included an extraordinary request from Israel: to use a coded “winking mechanism” to secretly notify officials whenever the companies complied with foreign legal demands for Israeli data.

 

Secret alert system for data transfers

 

The documents show that the Israeli government wanted the companies to embed hidden signals into payment transactions as covert alerts when data was shared with foreign law enforcement. The system was designed to bypass gag orders that legally prevented the companies from naming the countries involved.

 

Like other cloud providers, Google Cloud and Amazon Web Services (AWS) regularly cooperate with law enforcement agencies worldwide, providing customer data for investigations. Such exchanges are typically confidential, restricted by court or agency-imposed secrecy rules.

 

Google, Amazon agreed to Israel’s terms

 

Both Google and Amazon reportedly accepted the “winking mechanism” condition to secure the lucrative Nimbus deal. Israel had long feared losing control over sensitive national data to foreign jurisdictions, prompting officials to mandate this coded system.

 

An investigation by The Guardian, in collaboration with Israeli-Palestinian outlet +972 Magazine and Local Call, revealed that the companies accepted “strict and unusual controls” imposed by Israel. However, both firms have denied violating any international legal obligations.

 

How the ‘winking mechanism’ worked

 

The leaked final version of the Nimbus agreement outlines that the code would take the form of “special compensation” payments to Israel within 24 hours of a data transfer. Each payment corresponded to the telephone dialling code of the requesting foreign country — ranging from 1,000 to 9,999 shekels.

 

For example:

 

If US authorities requested data, the companies would pay 1,000 shekels (for +1).

 

For Italy (+39), they would transfer 3,900 shekels.

 

If no hint could legally be given about the country, a flat payment of 100,000 shekels (about $30,000) was to be made.

 

The Nimbus agreement: Israel’s data sovereignty project

 

Named after towering cloud formations, Project Nimbus is a cornerstone of Israel’s cloud modernisation strategy. It aims to migrate public sector and military data into privately operated data centres within Israel.

 

The seven-year deal, with an option for renewal, bars Google and Amazon from limiting or revoking Israeli access to their cloud infrastructure, even if the government’s actions conflict with company policies.

 

Officials inserted such clauses fearing that the companies might withdraw services under employee or shareholder pressure, especially over alleged human rights violations in Palestinian territories.

 

Safeguards against foreign and corporate interference

 

Israeli officials also feared potential vulnerabilities to foreign legal actions tied to how their data or AI systems were used during military operations in the West Bank or Gaza.

 

The Nimbus contract thus prevents unilateral suspension of services, a clause that gained renewed attention after Microsoft recently cut off an Israeli military system used for surveillance of Palestinian communications. Microsoft had competed for the Nimbus contract but reportedly refused certain government demands.

 

Tech giants under scrutiny amid Gaza war

 

Since the Gaza conflict escalated, Google and Amazon’s role in Project Nimbus has come under sharp scrutiny.

 

During Israel’s military operations, UN investigators accused Israel of potential war crimes, noting that its defence forces relied heavily on advanced cloud computing for data analysis and surveillance.

 

One intelligence database, containing intercepted Palestinian phone calls, was reportedly hosted on Microsoft Azure until August 2024, when data began shifting to Amazon Web Services.