Microsoft has officially “ceased and disabled” certain services to a unit within the Israel Ministry of Defense (IMOD) after an internal review found evidence supporting claims of mass surveillance of Palestinian civilians. This is a massive piece of news, especially since the company’s own Vice Chair and President, Brad Smith, shared a direct communication about the decision with employees.
The initial allegations surfaced in an article by The Guardian on August 6, reporting that a unit of the Israel Defense Forces (IDF) was “using Azure for the storage of data files of phone calls obtained through broad or mass surveillance of civilians in Gaza and the West Bank.” Microsoft launched an immediate review to investigate these serious claims. This entire situation is a reminder that tech companies, even huge ones, have to stick to their principles, or they face serious consequences.
Smith was very clear in his employee communication about the principles guiding the review, which are grounded in the company’s long-standing commitment to privacy. He said that, first and foremost, “we do not provide technology to facilitate mass surveillance of civilians.” He noted this principle has been applied globally for more than two decades, and it’s why Microsoft’s standard terms of service prohibit the use of its technology for that purpose.
Microsoft immediately ended Israel’s spying capabilities
Smith also made it clear that “we respect and protect the privacy rights of our customers,” meaning Microsoft “do[es] not access our customers’ content in this type of investigation.” That’s a huge point about customer trust, as it means the company didn’t snoop on the IMOD’s own files. The company just wanted to know the extent to which Israel was using them against Gaza.
The review itself focused on Microsoft’s own business records, things like financial statements, internal emails, and messaging, and not the IMOD’s data. Despite not looking at the customer data, Smith said that the company “found evidence that supports elements of The Guardian’s reporting.” The evidence included “information relating to IMOD consumption of Azure storage capacity in the Netherlands and the use of AI services,” which is pretty telling.
Microsoft has cut off the Israeli military’s access to its cloud and AI services after an internal review found preliminary evidence supporting reports of a surveillance system in Palestine's Gaza and the occupied West Bank#VoiceOfGaza#SahabatPalestina_ID#GazaGenocide pic.twitter.com/nortC546Tv
— owner of al quds (@__AloneWarrior_) September 25, 2025
As a result of these preliminary findings, Microsoft informed the IMOD of the decision to “cease and disable specified IMOD subscriptions and their services, including their use of specific cloud storage and AI services and technologies.” This move is all about enforcing their terms of service, with the explicit focus on “ensuring our services are not used for mass surveillance of civilians.” Microsoft wouldn’t be the first to lose its temper with Israel, but this is a big step.
To be fair, this is a firm stance for a major U.S. tech company to take against a military client. Smith took a moment to express “appreciation for the reporting of The Guardian,” acknowledging that the outlet’s reports, which were based in part on external sources, “helped inform our review.”
