Microsoft cuts AI services to Israeli defense unit after West Bank surveillance findings

Microsoft has disabled cloud and AI services used by an Israeli defense unit after finding preliminary evidence supporting reports that the technology was being used for civilian surveillance in Gaza and the West Bank. The action follows an internal review triggered by Guardian reporting in August, marking a significant policy enforcement by the tech giant regarding the use of its services for mass surveillance activities.

What happened: Microsoft’s review found evidence supporting elements of the Guardian’s reporting about Israel Defense Forces surveillance operations.

• The Guardian alleged that the IDF was using Microsoft’s Azure cloud platform for collecting and storing data on civilian phone calls in Gaza and the West Bank.
• Microsoft’s investigation revealed details on the Israel Ministry of Defense’s consumption of Azure storage capacity in the Netherlands and use of AI services.
• “We do not provide technology to facilitate mass surveillance of civilians,” said Brad Smith, Microsoft’s president, in a company blog post.

The company’s response: Microsoft has terminated specific services while maintaining other business relationships with Israel.

• The company informed the Israeli defense ministry of its “decision to cease and disable specified IMOD subscriptions and their services, including their use of specific cloud storage and AI services and technologies.”
• The action does not impact Microsoft’s cybersecurity services to Israel and other countries in the Middle East, Smith clarified.
• The review remains ongoing despite the preliminary findings.

Recent tensions: The decision comes amid broader internal conflict at Microsoft over its Israel relationships.

• In late August, Microsoft fired four employees who participated in protests on company premises over Microsoft’s ties to Israel during the ongoing Gaza war.
• Two of the terminated employees had joined a sit-in at the office of the company’s president.
• Microsoft said the terminations followed “serious breaches of company policies” and cited “significant safety concerns” from the on-site demonstrations.

Why this matters: The move demonstrates how major tech companies are grappling with the ethical implications of their services being used for surveillance, particularly in conflict zones where civilian populations are affected.