United States tech giant Microsoft has cancelled some services it provides to the Israeli military over concerns it is violating its terms of service by using the firm’s cloud computing software to spy on millions of Palestinians, the company’s vice chair and president Brad Smith confirmed.
Smith wrote in a Thursday blog post that the company had “ceased and disabled a set of services” to a unit within the Israeli Ministry of Defence in response to an August 6 joint investigation by The Guardian newspaper, +972 Magazine, and Hebrew-language outlet Local Call.
The report alleged that the Israeli military’s Unit 8200 used Microsoft’s Azure cloud computing platform to store phone call data obtained through mass surveillance in war-torn Gaza and the occupied West Bank.
Unit 8200 is the Israeli military’s elite cyber warfare unit responsible for clandestine operations, including collecting signal intelligence and surveillance.
The investigation by journalists revealed that following a 2021 meeting between Microsoft CEO Satya Nadella and Unit 8200’s leader Yossi Sariel, an agreement was reached to collaborate on moving large volumes of sensitive intelligence material into the company’s Azure platform.
The process, which has been operational since 2022, allowed Unit 8200 to utilise Azure’s near-limitless storage capacity and computing power to collect, play back and analyse the phone calls of millions of Palestinians.
The cloud-based system also helped Israel to guide deadly air strikes and shaped operations across the occupied Palestinian territory, Unit 8200 sources told the news outlets. The report also identified that a large amount of the data on Palestinians appeared to be stored on Microsoft’s Azure servers located in the Netherlands and Ireland.
Demonstrators march in support of Palestinians in Gaza near the Microsoft Build conference in Seattle, Washington, the US, in May 2024 [File: David Ryder/Reuters]
Microsoft’s Smith said the firm had reviewed the allegations made in the report “based on two principles” and concluded that the Israeli military data storage violated the company’s terms of service.
“First, we do not provide technology to facilitate mass surveillance of civilians. We have applied this principle in every country around the world, and we have insisted on it repeatedly for more than two decades,” he said.
“Second, we respect and protect the privacy rights of our customers,” Smith added.
Smith did not name the specific Israeli unit losing access to Microsoft services, but confirmed that some Israeli Defence Ministry subscriptions, including “specific cloud storage and AI services and technologies”, had been cancelled.
In February, The Associated Press news agency reported that the Israeli military’s use of Microsoft products spiked after the Hamas-led October 7, 2023, attacks on Israel and the start of the devastating war on Gaza.
It similarly reported that the Israeli military was using gigabytes of cloud storage and massive amounts of AI-enabled language translation services for mass surveillance, cross-checked with AI systems to decide on who should be targeted in air strikes.
In May, Microsoft acknowledged it had sold advanced AI and cloud computing services to the Israeli military during its war on Gaza and aided in efforts to locate and rescue Israeli captives in the besieged enclave.
The firm claimed, however, that following an internal review, it found “no evidence” that Azure was being used to target or harm people.
Following the August news investigation, Microsoft commissioned a second review, which was conducted by an outside law firm.
That review is ongoing, but Smith said it had already uncovered evidence that its products were being used in ways that violate its terms of service.
Hossam Nasr, one of more than a dozen Microsoft employees fired or arrested over protests against the company’s involvement in the Gaza war, hailed the move as an “unprecedented win”, but said the “vast majority of Microsoft’s contract with the Israeli military remains intact”.
“Microsoft has only disabled a small subset of services to only one unit in the Israeli military,” Nasr said.
