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Amid a consumer boycott of their Xbox business, Microsoft are apparently ending the Israeli military’s access to certain Azure cloud and generative AI technologies used to surveil Palestinians in Gaza and the West Bank. As reported by the Guardian, one of the publications who originally exposed the surveillance project, the company told Israeli officials last week that spy agency Unit 8200 had violated Microsoft’s terms of service by storing records of civilian phone calls and other data on Azure servers.

Microsoft’s vice-chair and president Brad Smith allegedly informed staff of the termination of the Unit 8200 partnership in an email sent on Thursday 18th September, shared with the Guardian. In that email, he said that Microsoft had “ceased and disabled a set of services to a unit within the Israel ministry of defense”, including cloud storage and AI services. “We do not provide technology to facilitate mass surveillance of civilians,” the email continues. “We have applied this principle in every country around the world, and we have insisted on it repeatedly for more than two decades.”

The Guardian also cite another email from a senior Microsoft executive to Israel’s ministry of defence, sent late last week, in which the executive noted that “[w]hile our review is ongoing, we have at this juncture identified evidence that supports elements of the Guardian’s reporting.”

Microsoft confirmed that they had supplied technology and services to the Israeli military during the latter’s current Gaza offensive this May, following an investigation of the alleged use of Microsoft genAI models to facilitate airstrikes, among other operations.

A protest by Microsoft staff at the company’s headquarters in August 2025. | Image credit: No Azure For Apartheid / Rock Paper Shotgun

In August this year, a joint investigation by the Guardian, +972 Magazine, and Local Call found that Microsoft had worked with Unit 8200 specifically to create an “indiscriminate new system” for gathering data on Palestinians, including a sizeable pool of non-combatants. For context, according to alleged leaked Israeli military intelligence, around 83% of the tens of thousands of Palestinians reported killed in the current conflict’s first 19 months were civilians.

The reporting inspired the Boycott, Divestment, Sanctions organisation to launch a campaign against Microsoft’s gaming business. Microsoft workers have been openly protesting against their employer’s involvement with the assault on Gaza since early 2024.

Back in May, Microsoft insisted that they had found “no evidence” that their technology was being used to target or harm Palestinians, following a review carried out by an unnamed third party. In August, a spokesperson announced that they would carry out another review, while insisting that “[a]t no time during this engagement has Microsoft been aware of the surveillance of civilians or collection of their cellphone conversations using Microsoft’s services, including through the external review it commissioned.”

Image credit: No Azure For Apartheid / Rock Paper Shotgun

The Guardian claim that as much as 8000 terabytes of intercepted calls were being held in Azure datacentres in the Netherlands as part of the Microsoft/Unit 8200 partnership. The paper adds that Unit 8200 appear to have swiftly moved the data elsewhere in the wake of their reporting. Israel now allegedly plan to transfer it all to Amazon’s Web Services cloud platform – neither Amazon nor the Israel Defense Forces have responded to the Guardian’s request for comment.

The reported partial divestment from Israel doesn’t reveal which “elements” of the Guardian’s reporting Microsoft have corroborated as part of their review. Microsoft continue to have a wider commercial relationship with the Israeli armed forces. They are also far from the only big overseas technology company to have significant dealings with Israel’s military, before and during the current invasion and destruction of Gaza – an Associated Press investigation in February also mentions Google, Amazon, Palantir, Cisco, and Oracle. A UN special rapporteur has accused western tech firms at large of being complicit in an “economy of genocide”.

We recently interviewed a number of developers, including former Microsoft worker Abdo Mohamed, about their participation in the internal No Azure for Apartheid movement and the wider BDS action against Microsoft.

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