Microsoft Terminates Israeli Unit 8200's Azure Access for Mass Surveillance of Palestinian Civilians

On September 25, 2025, Microsoft President Brad Smith announced the unprecedented decision to “cease and disable” cloud computing and AI services to Israel’s Unit 8200 military intelligence unit, marking the first time a major U.S. technology company terminated service to the Israeli military since the October 2023 Gaza war began. The decision followed an August 2025 joint investigation by The Guardian, +972 Magazine, and Local Call revealing that Unit 8200 had built a massive surveillance system on Microsoft’s Azure platform storing recordings of “a million calls an hour” from Palestinian civilians in Gaza and the West Bank, with the intercepted data used for blackmail, detention, and targeting lethal airstrikes. Smith grounded the termination in Microsoft’s two-decade principle: “We do not provide technology to facilitate mass surveillance of civilians.”

The mass surveillance system emerged from a late 2021 meeting at Microsoft’s Seattle headquarters between then-Unit 8200 Commander Yossi Sariel and Microsoft CEO Satya Nadella. Sariel approached Microsoft because the scope of Israeli intelligence operations on millions of Palestinians had grown so vast it could not be stored on military servers alone. Nadella agreed to develop a customized, segregated area within Azure to accommodate Unit 8200’s expansive surveillance ambitions. The “a million calls an hour” mantra spread within Unit 8200 captured the project’s scale—using Azure’s near-limitless storage capacity to collect and store recordings of millions of Palestinians’ daily communications. By July 2025, at least 11,500 terabytes of Israeli military data—equivalent to approximately 200 million hours of audio—were being stored on Microsoft servers, primarily in data centers in the Netherlands.

Sariel’s surveillance philosophy represented a radical departure from traditional targeted intelligence gathering toward comprehensive population monitoring. “His strategy was to begin ’tracking everyone, all the time,’” an officer who worked under him told investigators. Moving beyond targeted surveillance, Sariel’s approach employed mass surveillance across the occupied West Bank and Gaza Strip, combined with AI tools to extract actionable intelligence. This doctrine aligned precisely with the surveillance philosophy Unit 8200 veterans later deployed through Carbyne—the emergency response technology company founded by Unit 8200 alumni that Axon announced plans to acquire in September 2025. Carbyne’s founders, including CEO Amir Elichai and board member Pinchas Buchris (former Unit 8200 commander), brought the same “track everyone, all the time” methodology to civilian emergency services.

The August 6, 2025 Guardian investigation detailed how Unit 8200 weaponized the Azure-stored intelligence against Palestinian civilians. Intelligence officers told investigators the data stored in Azure served as a “rich intelligence source” that Israeli military forces used to blackmail individuals, detain them, or justify killings afterward. In Gaza, Unit 8200 analysts would examine phone call data stored in Azure to identify bombing targets, reviewing calls from Palestinian individuals nearby when planning airstrikes in densely populated civilian areas. Over two years of operations, the system facilitated both lethal airstrikes in Gaza and mass arrests of Palestinians in the West Bank, transforming Microsoft’s commercial cloud infrastructure into operational military surveillance and targeting apparatus.

Microsoft responded to the Guardian revelations by launching what Smith described as an “urgent” external investigation led by law firm Covington & Burling. The review focused on Microsoft’s business records, financial statements, and internal communications while explicitly avoiding access to customer data. Smith later informed employees that Microsoft’s investigation “found evidence that supports elements of The Guardian’s reporting,” specifically regarding Azure storage consumption in the Netherlands and AI services usage. Based on these findings, Microsoft informed Israel’s Ministry of Defense it would “cease and disable specified IMOD subscriptions and their services, including their use of specific cloud storage and AI services and technologies.”

Smith’s September 25 announcement carefully framed the decision as consistent with Microsoft’s long-standing principles. “We do not provide technology to facilitate mass surveillance of civilians,” he wrote. “We have applied this principle in every country around the world, and we have insisted on it repeatedly for more than two decades.” Smith emphasized that customer privacy protection remained paramount: Microsoft respects and safeguards customer privacy rights and did not access IMOD’s customer data during its investigation. He clarified the service termination “does not impact the important work that Microsoft continues to do to protect the cybersecurity of Israel and other countries in the Middle East, including under the Abraham Accords.”

The Israeli government’s response highlighted the sensitivity surrounding Unit 8200’s operations. Israel’s Defense Ministry initially provided no comment on Microsoft’s announcement. An earlier official Israeli statement had claimed work with Microsoft was based on “legally supervised agreements,” but subsequently stated that “Microsoft is not and has not been working with the IDF on the storage or processing of data”—a claim contradicted by Microsoft’s own investigation findings. While Microsoft did not name the specific unit in its announcement, The Guardian investigation had focused on Unit 8200, widely described as Israel’s equivalent to the U.S. National Security Agency and the Israeli military’s elite cyber warfare agency.

The Microsoft-Unit 8200 termination decision came amid mounting internal pressure from employees. Throughout 2025, Microsoft workers staged protests and sit-ins opposing the company’s Israel-related contracts, demanding greater accountability for how Microsoft technology enabled military operations affecting Palestinian civilians. The employee activism reflected broader technology sector debates about corporate complicity in surveillance infrastructure and military targeting systems. Microsoft’s willingness to terminate a significant military contract represented an unusual corporate response to such concerns, establishing potential precedent for technology companies confronting evidence their platforms enable mass civilian surveillance.

The decision’s timing proved particularly significant given contemporaneous developments in surveillance technology deployment. Just weeks before Microsoft’s announcement, Axon had unveiled plans to acquire Carbyne, the emergency response company founded by Unit 8200 veterans implementing the same “track everyone, all the time” surveillance philosophy Yossi Sariel pioneered. While Microsoft terminated Unit 8200’s Azure access after discovering mass surveillance of Palestinian civilians, the identical surveillance doctrine—developed by the same intelligence unit’s personnel—was simultaneously being deployed across American emergency services through Carbyne’s technology platform. The parallel narratives underscored how military surveillance methodologies migrate into civilian infrastructure through technology companies and personnel networks.

Yossi Sariel, architect of Unit 8200’s mass surveillance expansion and the Azure partnership, had resigned from Unit 8200 command in late 2023 after Hamas’s October 7 attack exposed intelligence failures. “The responsibility for 8200’s part in the intelligence and operational failure falls squarely on me,” the 46-year-old commander stated. His resignation followed revelations that a 2021 book he authored under a pseudonym had inadvertently exposed his identity and Google account through metadata—an ironic security lapse for the commander who championed comprehensive surveillance of Palestinian populations. Despite the intelligence failure precipitating his resignation and the subsequent exposure of his mass surveillance system, Sariel’s strategic vision of comprehensive population tracking continued proliferating through Unit 8200 alumni deploying similar technologies in commercial contexts.

Microsoft’s service termination represented what observers characterized as a watershed moment in technology ethics, establishing that major cloud providers could face accountability for enabling government mass surveillance programs. The decision demonstrated that investigative journalism exposing surveillance abuses could compel corporate policy changes even when governments provided legal frameworks justifying such operations. However, the episode also revealed the limitations of such accountability: while Microsoft terminated one contract after public exposure, the underlying surveillance methodologies and technologies continued migrating through personnel networks and corporate acquisitions into new contexts with less visibility and oversight. The Unit 8200 veterans’ simultaneous deployment of similar surveillance infrastructure through Carbyne into American emergency services illustrated how military intelligence doctrines could evade accountability by transitioning from one institutional context to another while maintaining core surveillance capabilities and philosophical approaches.