Basically there is no winning for Microsoft, except keeping it secret, having the US government pressure the Irish not to sue, or having the NSA pay possible fines.

Given the history of EU court vs Microsoft, and the market size of EU vs US, Microsoft has no easy solution to the problem. The US government might pressure the Irish, but would have a harder time against European union (which I suppose is part of its design).

I think the motivation is somewhat along the lines that the company didn't have a choice in the matter. Personally I wish that didn't matter and that the privacy breaches would have been prosecuted - I can think of nothing that makes legislative changes faster than companies having to choose where to do business because it would not be possible to do business both in USA and EU.

There have been some very shady dealings between Europe and the US, in areas as sensitive as financial and travel information, where it seems the US has demanded data and Europe has conveniently overlooked and/or hacked its own privacy and data protection laws so they can provide it.

I suspect given the increasingly anti-EU sentiments in many European countries and the outright hostile behaviour of the US toward foreign citizens in recent years, this situation isn't going to last much longer. Someone in politics is just waiting to make their career by telling a weakened EU administration and/or the US where to go, presenting themselves as the people's advocate and defender of basic human rights. This issue provides a convenient and potentially very effective vehicle for anyone with such ambitions.

Put another way, the asymmetric legal, economic and diplomatic relationships that have favoured the US for some time are essentially a bet that the US is worth more as a partner than any cost that asking "how high" will incur. Sooner or later, someone is going to call them, and at this point I'm not sure whether they're just bluffing.

Would citizens of the EU have faith in such a candidate anyway who will basically play the same game as their predecessors? Would anyone with the technical capabilities to develop and use encryption/steganography software for things they deem necessary to encrypt, put any trust in such a candidate over themselves?

Seems like a growing market to sell people on privacy as a service, which means there will be a growing market for those who want to subvert such…

Firstly, the means to make mass surveillance significantly more difficult and expensive already exist, we just don't use them routinely as a society. This lack of security and privacy awareness is harmful for many reasons, only a few of which are related to potential abuses by government organisations, but part of the reason they haven't been used more is because of the pressures imposed formally and no doubt less formally by governments. There is always going to be a balance here, because obviously there are bad people in the world and governments are expected (reasonably or otherwise) to protect their citizens and organisations against those bad people. I doubt any government is going to willingly give up all possibilities to intercept communication, but I think you could have a situation with much more transparency and oversight than we have today to keep that power in check and directed to its intended purposes.

Secondly, one of the most disappointing things about this whole affair is that our own intelligence and security services (I'm in the UK) seem to be more concerned with covering their backsides and keeping tight with their US chums than they are with actually, you know, providing for the security of their own country. In an era when foreign surveillance is a significant threat to everyone and so-called allies are among the prime culprits, the duty of our services is to treat those allies as hostile to the extent that their observed behaviour demonstrates they are hostile, and to respond proportionately. US spying on all our citizens' data? Promote encryption as standard and advise businesses on how to keep their data out of US jurisdiction. If allies have legitimate grounds for wanting sensitive information about British people (and I'm certainly not saying they won't have legitimate grounds for doing so from time to time) then let them request that information through proper channels and in compliance with our laws (and make sure our laws provide for assisting allies appropriately but with appropriate controls and oversight as well).

Ultimately, you can't rationally expect governments to protect their people without allowing them to use the technical tools and legal powers necessary to do so, but neither can you rationally protect your society and way of life by destroying it. This debate is all about resolving that inherent conflict in as fair and practical a way as possible, and to that extent, I think some fresh views in politics could improve the current situation considerably.

One has to acknowledge that it is also not presently in the interests of those who have kept it so. Transparency is a two way street, if everyone as individuals had access to such information that is in the hands of the few to leverage, many aspects of our society could also be made better. After all, "encrypt all the things" makes one wonder about the effort exerted is worth it all, especially if it enables individuals to deceive/mislead/exaggerate to others in the name of privacy.

Secondly, one of the most disappointing things about this whole affair is that our own intelligence and security services (I'm in the UK) seem to be more concerned with covering their backsides and keeping tight with their US chums than they are with actually, you know, providing for the security of their own country.

I question how much "security" there needs to be when governments, corporations and individuals go to such lengths to hide such information from others to maintain the asymmetry of information from individuals of the public, and wonder if they're would be more "security" provided if the public who funds such boondoggles had access to such infrastructure. I'd rather have API keys than the hand-waving/profiteering/"we know whats best for you" media/policy makers and it's enablers tell us what they think we, the public, should know of what they do on our behalf, because only they should be responsible for protecting us, and not ourselves as individuals?

I never have expected any government to protect "their" people, when all of them to some degree are actively harming them and continue to do so through various means unaccountably with claims onto behalf of the public.

Part of Microsoft's solution to the problem is getting this headline published. While the article suggests that this has been going on since before the Snowden information disclosures arose, demonstrating that they're resisting is a change from the perception many had regarding Microsoft's stance on these issues when the Snowden content first began to be published. This excerpt supports this point:

"Microsoft’s efforts to push back against the government in this and other cases, company officials say, predate the disclosures by former National Security Agency contractor Edward Snowden about the reach of U.S. surveillance. But the revelations, which began a year ago, “certainly put a premium on demonstrating to people that we are fighting,” said one Microsoft official who spoke on the condition of anonymity because he was not authorized to speak for the company."

Perhaps consider moving all operations to Europe.

http://en.wikipedia.org/wiki/European_Union_Microsoft_compet...

If, e.g., Europe, is serious about protecting and defending against the demons that are quickly consuming the USA; they need to put in place meaningful, positive controls in place.

We really need to start coming to terms with the fact that we, the USA, are quickly becoming or maybe even are the most dangerous force humanity has ever seen. Sure, we are not "doing anything wrong" other than killing civilians and even out own people against our own laws by rationalizing ways and reasons to sidestep our most core fundamentals; but we will all rue the day that the force canalizes and stripps off its mask to reveal something far more sinister than most people could even imagine.

You have to remember, no horrible regime took power by saying they will graduate to brutalizing their own people. Put it this way, we are well into several meth highs, still insisting that we will be able to stop when we want to and control any addiction that may arise.

The court's argument could be that MS should be required to design their systems to make it possible to comply with their requests.

This is why Microsoft are in a Catch-22 situation, and why the correct solution for Europe is probably to just stand their ground until the US realises it has gone too far in expecting its laws to apply to the whole world and is now asking the impossible at the expense of its own business community.

(Assuming the US court claims jurisdiction, which is more or less what this case is about)

Not all cloud services have this limitation. However I suspect that there will always be some metadata that the government will be able to request from the cloud provider, and this legal question will still be relevant.