WASHINGTON, D.C.: Microsoft said on September 25 that it has restricted access to some of its cloud and artificial intelligence products for a unit of the Israeli military, after internal and external reviews concluded its services were being used to support mass surveillance of Palestinians.

The move follows reports by The Associated Press and The Guardian earlier this year detailing how Israel's Ministry of Defense had relied on Microsoft's Azure platform during the war in Gaza and in the occupied West Bank. Brad Smith, Microsoft's vice chair and president, said in a blog post that the company was enforcing its terms of service after uncovering evidence of misuse.

An investigation in February found the Israeli military had dramatically expanded its use of Microsoft tools after Hamas's October 7, 2023, attack, including gigabytes of cloud storage and large-scale AI-enabled translation services. Those systems were used to process intercepted phone calls and text messages, which were then fed into Israel's own AI systems to help identify airstrike targets.

Internal Microsoft records showed multiple Azure subscriptions tied to Unit 8200, Israel's elite cyber warfare division. The Guardian, working with +972 Magazine and Local Call, later reported that Unit 8200 had used Microsoft technology to build an AI-powered mass surveillance system capable of sweeping up and analyzing millions of Palestinian phone calls daily, with data stored at Microsoft's European data centers.

Microsoft acknowledged in May that it had provided advanced services to Israel's military to aid hostage recovery efforts, but said at the time it found "no evidence" Azure had been used to harm people. After The Guardian's August report, the company hired an outside law firm for a second probe. Smith said that the review had uncovered evidence of violations, but he did not name the specific unit losing access.

Asked whether Unit 8200 was among those affected, Microsoft declined to answer. The company also did not say how it would prevent Israel's military from shifting operations to other Azure accounts.

An Israeli security official told AP the action would cause "no damage to the operational capabilities" of the Israel Defense Forces.

Activists, however, said the step fell short. Hossam Nasr, a former Microsoft employee and organizer with the group No Azure for Apartheid, called it a "significant and unprecedented win" but noted most of the company's military contracts with Israel remain in place.