Company Feature

CISCO’S INVOLVMENT IN THE ISRAELI OCCUPATION

SEPTEMBER 2019 Cisco’s Involvement in the Occupation Israel’s Digital Initiative was outlined by the government in 2013 in Resolution No. Cisco Systems is a US-based publicly traded 1046.3 The Initiative, falls under the remit of company, that develops, manufactures and the Ministry for Social Equality, and aims to sells hi-tech services and products for various formulate and implement a national digital sectors. policy for economic development, while in- Through its Israeli subsidiary, Cisco – Isra- creasing both national and local government el, Cisco Systems is currently involved in the efficiency.4 establishment of technological hubs in the As part of this partnership, the launch of a occupied Palestinian territory and in the Syr- joint collaborative effort with the Israeli gov- ian Golan, as well as, in the Naqab (Negev) ernment to open 100 technological hubs, was region. The company is complicit in Israel’s announced in 2018. These hubs, equipped expanding visual surveillance apparatus in with Cisco’s technology, are to bring pros- Jerusalem and has won an Israeli Ministry of perity to “Israel’s geographical and economic Defense (IMOD) tender to provide servers periphery”, by providing local entrepreneurs and IT support to the Israeli military. with the space and support they need to de- Further, through its Israeli subsidiary, Cisco velop new business ideas and connect them Systems is involved in the emerging Palestin- to Tel Aviv, Israel’s technological and econom- ian hi-tech sector. This involvement takes the ic center.5 guise of technological development and job In February 2019, the Ministry for the De- creation but in fact, contributes to the struc- velopment of the Negev and the Galilee, an- tural dependency of the Palestinian economy nounced the allocation of 90 million NIS (¬ 25 on that of Israel. million USD) for the launch of 45 such hubs, The company’s involvement in activities - re all of which will be equipped with Cisco com- lated to Israel’s occupation comes in violation munication technology.6 of international law and contradict its stated commitment to human rights and the UN Hubs on Occupied Land: Global Compact for Corporate Social Respon- Two of the 10 hubs opened to date are locat- 1 sibility. ed on occupied territory. One is located in the Prior to publication, Who Profits contacted occupied Syrian Golan –at the Ha’Emir junc- Cisco Systems to share the information pre- tion, between the settlement of Sha’al and sented here and request a response. None 3 The Prime Minister’s Office, “National was received. Initiative “Digital Israel”, 15 December 2013. 4 Ministry for Social Equality, “The Digital Technological Hubs on Occupied Land Israel National Initiative: The National Digital Pro- In 2016, Cisco announced a three-year part- gram of the Government of Israel,” June 2017. nership with the Israeli government to ad- 5 Meir Orbach, “Cisco Launched a Network vance the, “Digital Israel National Initiative” of Technology Centers in Israel”, (Hebrew) Calcal- (hereinafter: Digital Initiative).2 ist, 6 March 2018. 6 The Ministry for the Development of the 1 Cisco, Corporate Social Responsibility. Periphery, the Negev and the Galilee, “Joint Work 2 Cisco, “Cisco and Israel Announce Part- nership to Accelerate Country Digitization”, 26 area “Klika Tefen Tower” is Underway!”, 20 Febru- June 2016. ary 2019.

2 | Cisco Odem, the other is located in the regional Hubs in the Naqab: council of the settlement of Mateh Binyamin, In the Naqab, where ten Cisco technology in the occupied West Bank. At least one addi- equipped hubs are planned, two are located tional hub is planned in the Golan and three in Palestinian towns – one in Hura and the others will serve settlements in the West Bank other in Ar’arat al-Naqab (two out of seven (Modi’in Illit, Beitar Illit and the Shomron Re- Palestinian Bedouin towns in the Naqab).10 gional Council).7 Additionally, twenty-six hubs These hubs form part of the Israeli govern- are planned for Jerusalem, including in occu- ment’s industrialisation and resettlement 8 pied East Jerusalem. plan which strives to create jobs in the Naqab, The Syrian Golan, the West Bank and East in the hope of drawing Jewish Israelis to settle Jerusalem are recognised as occupied lands in the region, while concentrating its Palestin- under international law and by the majority ian communities into ghettoised residential of the international community. Cisco’s -par areas. For more information on this plan and ticipation in a project which designates them its effects on the Naqab’s Palestinian commu- as Israeli “periphery” areas contributes to ef- nity see Who Profits’ report: Plundering the forts to legitimise Israel’s illegal annexation Sun: the Israeli Solar Energy Industry and Pal- and occupation of these territories. estinian Forced Displacement. These technological hubs directly benefit Is- Acquisition and Investment in Israeli rael’s industrialisation on occupied land. In addition, they also encourage the population Start-ups of settlements through job creation, whilst Cisco’s involvement in Israel’s Digital Agenda bolstering settlements’ economic power. This follows a long trend of acquisition and invest- comes at the direct expense of Palestinian ment in Israeli hi-tech start-up companies. and Syrian communities and is illegal under Since the late 1990’s Cisco has spent over 2 international law.9 billion USD in acquisition of Israeli start-up companies. Cisco also invests in over 25 Israe- 7 The Ministry for the Development of the Periphery, the Negev and the Galilee, “Klika – Joint Golan. Furthermore, in 2014, the UN’s Office of Work Spaces of the Ministry for the Development the High Commissioner for Human Rights restated of the Periphery, the Negev and the Galilee,” (He- that the Israeli settlements “encompass all physi- brew) 6 February 2019. cal and non-physical structures and processes that 8 Meir Orbach, “Cisco Launched a Network constitute, enable and support the establishment, of Technology Centers in Israel”, (Hebrew) Calcal- expansion and maintenance of Israeli residential ist, 6 March 2018. communities beyond the Green Line of 1949 on 9 The Hague Regulations and the Fourth the occupied Palestinian Territory”. UN Office of Geneva Convention prohibit settlements under the High Commissioner for Human Rights, “State- occupation and considers them as a war crime. ment on the Implications of the Guiding Principles The international community has consistently on Business and Human Rights in the Context of reiterated international law provisions, deeming Israeli Settlements in the Occupied Palestinian Ter- Israeli settlements illegal. Through various reso- ritory”, 6 June 2014, p.1 (footnote 2). lutions, the UN Security Council continues to call 10 Hagar Bohbot, “Meet Cisco’s Digitisa- for complete Israeli withdrawal from the occupied tion Program in Israel”, (Hebrew) Ynet, 5 February territory, including East Jerusalem and the Syrian 2018.

3 | Cisco li start-up companies.11 One of these invest- Entrenching Economic Dependency ments is in Team8, a cyber-security incubator. In 2008, Cisco signed a collaborative deal with According to Team8 it raised 18 million USD the Palestinian President, Mahmoud Abbas, from a series of venture capital funds and for the investment of 10 million USD for the strategic private investors, one of which was development of the Palestinian hi-tech -sec Cisco.12 tor. 16 The investment was managed by Gai Team8 was co-founded by Nadav Zafrir and Hatzroni, then the manager of the software Liran and Israel Grinberg - all veterans of the development department at Cisco-Israel. 17 Israeli military’s technology and intelligence The deal involved outsourcing work to Pales- unit, known as Unit 8200. Israel Grinberg is tinian engineers and technicians, led by Cisco the former head of Unit 8200, while Nadav Israel. This Cisco project was a milestone in Zafriri is also the founder of the Israeli mili- setting a trend in the outsourcing of work to 13 tary’s Cyber Command. a skilled, yet comparatively cheap Palestinian The development of Israel’s multi-mil- work force by Israeli and Israeli intermediar- lion-dollar hi-tech industry has been linked ies of international companies.18 Palestinian to the privatisation of knowledge amassed workers are paid well below the wages of an by the Israeli military and Unit 8200, in par- Israeli hi-tech worker (2,500 and 4,000 USD ticular.14 Unit 8200 is the Israeli military’s respectively). Since Cisco’s deal in 2008, the biggest intelligence unit, developing in- Israeli subsidiaries of Intel, Microsoft and house technology for coercive spying tactics, Mellanox, have also outsourced work to Pal- including the collection of sexual, personal, estinian technicians.19 This outsourcing pro- financial and other information, exposing cess reduces production costs through - ex Palestinians to extortion by Israel’s security ploitation, and entrenches the dependency services.15 of Palestinian economic development on the economic and political interests of the occu- 11 Inbal Orpaz, “Cisco Purchases the Israeli pying power. CloudLock for $300 million”, (Hebrew) The Merker, In recent years the Palestinian hi-tech sec- 28 June 2016. tor has experienced a noticeable growth. 12 Liran Grinberg, “Cyber “Think Tank” Team According to the Palestinian Information 8 Raises $18 Million Series A Round To Develop and Technology Association of Companies, And Launch Cyber-Security Startups”, Team8, 10 there are over 250 Palestinian hi-tech com- February 2015. panies, while the sector constitutes around 13 Team8, Leadership Team, Team8.vc 14 See Ori Swed, “Military Capital in the Is- 16 Cisco, “Cisco Announces $10 Million In- raeli Hi-Tech Industry”, Armed Forces & Society vestment to Support Job Creation and Economic Journal, January 2013 and Dr. Daphne Getz and Development in the Palestinian Territories,” 29 Dr. Itzhak Goldberg, “Best Practices and Lessons January 2008. Learned in ICT Sector Innovation: A Case Study 17 Maya Benjamin, “Hi-Tech in the Palestin- of Israel”, The World Bank Development, 2016. 8 ian Authority: “There is A Real Hunger for Success June 2017. Here””(Hebrew), TechTime, 29 June 2015. 15 Peter Beaumont, “Israel’s Unit 8200 Re- 18 Matan Ofer, “Breaking the Hi-Tech Barri- fusniks: ‘You Can’t Run from Responsibility,” The er”, (Hebrew) Yediot Ahronot, 8 May 2017. Guardian, 12 September 2014. 19 Ibid

4 | Cisco 12% of Palestinian GDP, equivalent to 500 lem’s Old City: Israel’s Militarization Visual million USD.20 Surveillance System in Occupied East Jerusa- Surveillance in Jerusalem lem. Cisco is involved in expanding Israel’s visual Services to the Israeli Military surveillance apparatus in Jerusalem, which In 2017, Cisco cut a multi-million-shekel three- predominantly targets the Palestinian popu- year deal with the Israeli military to upgrade 21 lation under its control. military defense networks.24 Cisco servers are In August 2017, Cisco made an offer to the Je- to be delivered through the Israeli company rusalem Municipality to launch a pilot project Bynet Data Communication Ltd. (a member for the development of ‘Smart City’ technol- of the Rad- Bynet Group), a contract former- ogy, free of charge. The 36-month joint ven- ly held by the now defunct Hewlett-Pack- ture is to be implemented in two sites in the ard (HP).25 For Cisco this contract is of both center of West Jerusalem, with the prospect financial benefit and ideological significance. of expansion. This pilot project includes the Cisco Israel’s CEO, Oren Sagi stated that it is implementation of technology, communica- “an integral part of our commitment to the tion equipment and CCTVs, connected toa State of Israel,’’.26 command and control center. The center is to This is not the first contract the company has be equipped with video analysis software and signed with the Israeli military. In 2013 the technology which include a voice detection company won a 150 million USD tender for capacity and the ability to detect and alert the supply of communication equipment to about the presence of lingering groups. The the Israeli military.27 center will have the ability to analyse footage from up to 10,000 CCTV cameras.22 Financial Information: In recent years, Israel’s security strategy in Je- Ownership: Major shareholders: Vanguard Group rusalem has relied heavily upon investment in Inc (10.46%), Blackrock Inc. (9.85%), State Street visual surveillance networks. Private corpora- Corp (5.73%), Bank of New York Mellon Corp tions are complicit in facilitating a wider mon- (3.06%), Bank of Maerica Corp /DE/ (2.75%). itoring range with adverse impacts on Pales- tinians living in the city. The activities generate 24 Meyer Orbach, “Cisco Will Provide the huge profits for these corporations.23 Ministry of Defense With Servers Worth Around For a detailed analysis of how Jerusalem has $250”, (Hebrew), Calcalist, 16 January 2017. become a testing ground for corporations de- 25 Aliran Robin, “Cisco Won the Tender for veloping urban surveillance technology see the Supply of Servers to the Security Forces – Who Profits’ report: “Big Brother” in Jerusa- Worth about One Billion Shekels”, (Hebrew) The Merker, 16 January 2017. 20 The Palestinian Information Technology 26 Roben Aliron, “Cisco Won the Tender for Association of Companies, www.home.pita.ps/ the Provision of Servers to the Security Forces - wp/ Worth About One Billion Shekels”, (Hebrew) The 21 Who Profits, “Big Brother” in Jerusalem’s Marker, 16 January 2017. Old City Israel’s Militarized Visual Surveillance Sys- 27 Navit Zomor, “Today: Cisco to Fire 280 tem in Occupied East Jerusalem”, November 2018. Workers,” Clacalist (Hebrew), 2 November 2014. 22 On file with Who Profits. 23 Ibid

5 | Cisco CEO: Charles H. Robbins Tata Consultancy Services Ltd.; VMware, Inc.; Traded: Publicly traded in NASDAQ under the Wipro Limited. ticker symbol CSCO. Other partners include the Jerusalem Municipal- Revenues: 49.3 Million USD in 2018. ity, the Israeli Ministry of Defense, Bezeq and the Israel Electric Company (IEC). Partners: The company holds strategic alliances with the following companies: Accenture Ltd; Subsidiaries: The company operates more than Apple Inc.; AT&T Inc.; Cap Gemini S.A.; Citrix 150 subsidiaries worldwide. Systems, Inc.; Dell Technologies Inc.; LM Erics- Head Office: 170 West Tasman Drive, San Jose, son Telephone Company; Fujitsu Limited; Inspur California 95134-1706, USA Group Ltd.; Intel Corporation; International Tel: +1-408-526-4000 Business Machines Corporation; Italtel SpA; Office in Israel: 32 Hamelacha st., I.Z. Sapir, P.O. Johnson Controls Inc.; Microsoft Corporation; Box 8735, South Netanya 42504, Israel NetApp, Inc.; Optum; Oracle Corporation; Red Tel: +972-9-8927001 Hat, Inc.; SAP AG; Sprint Nextel Corporation; Website: www.cisco.com

6 | Cisco