The Microsoft Azure disruptions in the Middle East highlight the vulnerability of global cloud infrastructure. On Saturday, Microsoft confirmed that undersea fiber cuts in the Red Sea affected Azure services across the region.
According to the company, traffic was rerouted through alternate paths to keep services running. While connectivity remains intact, some users may notice higher latency. “Network traffic that does not traverse through the Middle East is not impacted,” Microsoft explained. The company pledged to provide daily updates, or sooner if conditions change.
Azure, Microsoft’s flagship cloud computing platform, is the world’s second-largest cloud provider after Amazon Web Services (AWS). It powers applications and services for individuals, corporations, and governments worldwide. This latest disruption underscores how dependent global enterprises have become on undersea internet cables.
Concerns over cloud market dominance have also been growing. In July, the UK’s Competition and Markets Authority (CMA) released a report claiming that Microsoft and Amazon control up to 80% of the UK’s cloud market. Regulators argue this concentration limits consumer choice and stifles competition. The CMA has called for an antitrust probe under the UK’s new digital market rules.
Despite these regulatory challenges, Microsoft’s financial performance remains strong. In July, the company reported Q4 revenue of $76.4 billion, a jump of 18% from the previous year and above analyst expectations. Net income rose 24% to $27.2 billion, while earnings per share hit $3.65, beating the forecast of $3.38.
Microsoft is also expanding Azure’s AI offerings. In May, it announced the addition of Elon Musk’s xAI models Grok 3 and Grok 3 Mini to the Azure AI Foundry marketplace. These models come with full service-level agreements, reinforcing Microsoft’s push to deliver a broad range of managed AI solutions.
The Microsoft Azure disruptions caused by the Red Sea fiber cuts highlight both the resilience and fragility of cloud services. With rerouted traffic sustaining operations, customers continue to rely on Azure even as global regulators and competitors watch closely.