In Short:
– Google Cloud and Palo Alto Networks have partnered on a nearly $10 billion security services deal.
– The multiyear contract will integrate Palo Alto’s security platform with Google Cloud’s AI capabilities.

Alphabet’s Google Cloud and Palo Alto Networks have announced a partnership valued at nearly $10 billion. This agreement marks the largest security services deal for Google Cloud as enterprises increase efforts to protect AI infrastructure amid rising cyber threats.The multiyear contract involves Palo Alto moving key internal workloads to Google Cloud and creating new AI-driven security solutions. While executives refrained from commenting on financial specifics, the deal enhances a relationship formed in 2018.

Research from Palo Alto’s December 2025 State of Cloud Report revealed that 99% of surveyed companies faced at least one attack on their AI infrastructure in the past year. The collaboration aims to integrate Palo Alto’s Prisma AIRS security platform with Google Cloud’s AI capabilities, including Vertex AI and Agent Engine, to enhance protection for AI workloads.

AI Security Demand

Matt Renner, Google Cloud’s chief revenue officer, indicated that the surge in AI has created significant security demand. BJ Jenkins, president at Palo Alto, likened the current threat environment to those seen during the early growth of cloud computing.

The investment will see Palo Alto’s products migrated to Google’s platform, while also funding new AI-focused services. The companies have launched 75 joint integrations, achieving $2 billion in sales via the Google Cloud Marketplace.

The agreement also highlights broader cybersecurity strategies from both firms. Google is pursuing a $32 billion acquisition of Wiz, awaiting regulatory approval. Meanwhile, Palo Alto has plans to acquire observability platform Chronosphere for $3.35 billion.

Renner noted that this collaboration positions Google Cloud advantageously as AI continues to reshape the competitive landscape against rivals like Amazon and Microsoft. Furthermore, Palo Alto CEO Nikesh Arora’s previous experience at Google enhances the partnership’s potential.

In Short:
– Ukraine increased drone production to 950 daily, intercepting 1,500 enemy drones recently during ongoing Russian attacks.
– New interceptors, costing $1,000-$5,000, highlight a shift in defence economics, with 68% success rates reported.

Ukraine has significantly increased production of low-cost interceptor drones, reaching almost 950 units daily. This surge comes as Russian attacks persist, targeting Ukrainian cities and infrastructure. The drones, costing around $1,000 each, have successfully downed over 1,500 enemy drones recently, preserving more expensive missiles for higher threats.On December 21-22, Russian forces launched 86 attack drones, and Ukrainian air defenses intercepted 58 of them. This attack pattern has escalated throughout 2025, with Russia deploying about 5,500 Shahed-type drones monthly against Ukraine.

The interceptors evolved from prototypes to mass production within months in 2025, marking a significant shift in modern warfare. Ukraine’s Defense Ministry collaborates with over 10 manufacturers producing drones designed to counter Shahed-type unmanned aerial vehicles.

New Technology

The Sting, developed by the volunteer initiative Wild Hornets, illustrates this advancement. Resembling a flying thermos and built on a 17-inch frame, the quadcopter can reach speeds of 315 kilometers per hour and engage targets from 25 kilometers away. Operators control the drones using virtual reality goggles, impacting enemy aircraft mid-flight.

“Every destroyed target is something that did not hit our homes or power plants,” said a commander with the call sign Loi.

The financial aspects favour defenders, reversing traditional air defence economics. Ukrainian interceptors range from $1,000 to $5,000, while Russian Shahed drones cost around $35,000. President Volodymyr Zelenskyy mentioned that the success rate for interceptor drones is currently 68 percent.

“Cheap interceptor drones have become critical, warranting their status as a cornerstone of modern counter-unmanned aerial systems,” stated defense analyst Federico Borsari. NATO has observed successful Sting demonstrations, while the European Union plans a “drone wall” along its eastern border, expected to be operational by late 2027.

In Short:
– Japan plans to invest ¥1 trillion in domestic AI to enhance infrastructure and compete globally.
– China is focusing on technological independence as domestic chipmakers prepare for public offerings.

Japan plans to invest ¥1 trillion ($6.34 billion) over five years in a domestic artificial intelligence company. This initiative aims to build infrastructure for AI, despite rising electricity costs raising concerns about the industry’s sustainability.The government will collaborate with SoftBank Group and Preferred Networks to develop the largest foundation model in Japan, employing around 100 engineers to compete globally. This effort reflects worries about the risks of relying on foreign AI technology.

China is also increasing its focus on technological independence. Domestic chipmakers are preparing for public offerings to enhance their capabilities, following successful launches by Moore Threads and MetaX in Shanghai. Companies such as Biren Technology and Baidu’s Kunlunxin are also planning to go public.

SoftBank is pursuing a $22.5 billion funding commitment to OpenAI by year-end, by selling assets and securing loans. CEO Masayoshi Son’s significant investment signifies a strong commitment to AI infrastructure.

AI Infrastructure

The rapid expansion of data centers is putting pressure on energy resources. Projections suggest data centers will consume 945 terawatt-hours by 2030, nearly tripling from 415 TWh in 2024. In the U.S., energy use by data centers could reach 9% to 12% of total supply by 2028.

Concerns have arisen over whether tech companies’ activities are raising residential electricity costs, with investigations launched by three Democratic senators targeting major companies like Alphabet, Microsoft, and Amazon. Utilities face significant expenses to upgrade grids, which may be passed on to consumers.

The energy demand is benefiting companies that supply power infrastructure. Jefferies recently upgraded GE Vernova to Buy, citing expected growth in gas pricing and long-term service demand amid rising energy needs.