Microsoft reduces Israel’s access to cloud and AI products over reports of mass surveillance in Gaza

The logo of Microsoft is seen outside its French headquarters in Issy-les-Moulineaux, outside Paris, on May 13, 2024. (AP Photo/Thibault Camus, File)

WASHINGTON — Microsoft said Thursday it had disabled services to a unit within the Israeli military after a company review had determined its artificial intelligence and cloud computing products were being used to help carry out mass surveillance of Palestinians.

The action comes after The Associated Press and The Guardian published reports earlier this year revealing how the Israeli Ministry of Defense had been using Microsoft’s Azure platform to aid in the war in Gaza and occupation of the West Bank. Brad Smith, Microsoft’s vice chair and president, wrote in a blog post that the company was taking steps to enforce compliance with its terms of service.

An AP investigation in February showed that the Israeli military’s use of Microsoft products skyrocketed after a deadly surprise attack by Hamas militants on Oct. 7, 2023. The AP’s report cited internal Microsoft data showing the Israelis were using gigabytes of cloud storage and massive amounts of AI-enabled language translation services.

The AP also reported that Israel’s military used Microsoft Azure to compile information gathered through mass surveillance, which it transcribes and translates, including phone calls and text messages. That intelligence is then cross-checked with Israel’s in-house AI systems for targeting airstrikes.

AP reported that internal Microsoft data showed multiple Azure subscriptions were tied to Unit 8200, an elite cyber warfare unit within the Israeli Army responsible for clandestine operations, collecting signal intelligence and surveillance.

Following AP’s report, Microsoft acknowledged in May that it had sold advanced AI and cloud computing services to the Israeli military during the Gaza war and aided in efforts to locate and rescue Israeli hostages. But the company said an internal review found “no evidence” its Azure platform was used to target or harm people.

The Guardian, working in partnership with the Israeli-Palestinian publication +972 Magazine and the Hebrew-language outlet Local Call, reported in August that the commander of Unit 8200 had met directly with Microsoft chairman and CEO Satya Nadella in 2021. The Israeli unit then used Microsoft products to aid in the development of an AI-powered mass surveillance system that was sweeping up, translating and analyzing millions of telephone calls per day made by Palestinian civilians. The report also revealed that data from the Israeli surveillance system was being stored at Microsoft cloud data centers in Europe.

Following The Guardian’s report, Microsoft commissioned a second review, this time by an outside law firm. While that review is still ongoing, Smith said Thursday the probe had uncovered evidence that its products were being used in violation of its terms of service. However, Smith did not name the specific Israeli unit losing access to Microsoft services.

Microsoft declined to answer detailed questions from the AP on Thursday, including whether Unit 8200 was involved. The company would also not answer how it would ensure the Israeli military wouldn’t simply shift its mass surveillance operations to any of the hundreds of other Azure subscriptions under its control.

An Israeli security official told the AP Microsoft’s move would produce “no damage to the operational capabilities” of the Israel Defense Forces. The official spoke on condition of anonymity, consistent with military protocol in Israel.

Hossam Nasr, one of more than a dozen Microsoft employees fired or arrested after protests over the company’s involvement in the war in Gaza, called Thursday’s announcement a “significant and unprecedented win.” But, he said, it was not enough.

“Microsoft has only disabled a small subset of services to only one unit in the Israeli military,” said Nasr, an organizer with the group No Azure for Apartheid. “The vast majority of Microsoft’s contract with the Israeli military remains intact.”

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Mednick reported from Jerusalem and Burke from San Francisco.

Michael Biesecker, Sam Mednick And Garance Burke, The Associated Press