In a move to address growing concern (and consequent loss of revenue) about NSA access to data stored on US servers, Microsoft is now considering allowing non-US customers to store their data in servers located outside the United States,
‘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,” Brad Smith, general counsel at Microsoft, told the Financial Times.
This is a break away from other US-based tech firms, who have so far presented a united front resisting any pressure to move storage overseas (which, apart from anything else, would be very costly for those companies). Microsoft is in a strong position here as it has already established data centers around the world (EU citizens for example could store data its server farms in Ireland).
Although this announcement (which does not yet involve concrete plans) has received some positive response from privacy advocates, it should clearly understood that US companies are legally required under the Patriot Act to hand over information on their servers to US intelligence agencies, even if that information resides on servers outnside the US. Basically, US agencies can access any data held by a US company, regardless of whether that data is stored outside the US, so it is unclear to us what benefits it will bring.