News

Microsoft To Give Cloud Users Option To Store Data Abroad

• By Jeffrey Schwartz
• January 30, 2014

In response to customer concerns over government surveillance programs, Microsoft is planning to give cloud customers outside the United States the option to store their data in offshore datacenters.

The move is aimed at assuaging the worries of customers outside the United States over whether the National Security Agency (NSA) or other U.S. agencies can intercept their encrypted communications. NSA surveillance activities -- such as the PRISM  program revealed last year by former contractor Edward Snowden -- have led to concerns that data stored within the United States is not secure.

Microsoft's plan will cover data sovereignty requirements of those in foreign countries, particularly Brazil and throughout the European Union.

Brad Smith, Microsoft's chief counsel, revealed Microsoft's plan to give customers the choice of where their data is stored in an interview last week with the Financial Times.

"People should have the ability to know whether their data are being subjected to the laws and access of governments in some other country and should have the ability to make an informed choice of where their data resides," Smith said.

Microsoft confirmed Smith's comments but said it has no immediate plans to elaborate.

Jeffrey Chester, executive director of the Center for Digital Democracy, an advocacy organization for privacy, said Microsoft is the first major U.S.-based digital provider to give customers control over where their data is stored.

"Practically the entire industry is strongly opposed to any EU rule requiring that data on its citizens be stored -- and also regulated -- by either member states or other governmental entities," he said in an e-mail this week. "This move should boost the company's prospects attracting EU and other privacy-concerned businesses or consumers. It's unlikely, however, that others will follow suit, despite Microsoft breaking ranks with the industry lobby."

Asked why, Chester pointed to a number of groups that oppose forcing providers to offer that choice. Among them are the Internet Association, whose members include Amazon, eBay, Facebook and Yahoo; the Business Coalition for Transatlantic Trace (BCTT) Digital Trade Working Group, which includes companies that perform online international trade, including its corporate chairs Amway, Chrysler, Citigroup, Dow Chemical, FedEx, Ford, GE, IBM, Intel, Johnson & Johnson, JP Morgan Chase, Eli Lilly, MetLife and UPS; and the  Information Technology and Innovation Foundation (ITIF), a Washington, D.C.-based think tank that, ironically, is backed by Microsoft, Chester noted.

"They want to stuff exporting consumer data to the cloud down the throat of EU consumers," Chester said. "Perhaps demand will, over time, change their position, but for now they want no local rules."