Using Cloud 'Likely' Waives Data Ownership

Pablo Valerio, International Business & IT Consultant | 11/15/2012 | 19 comments

Pablo Valerio
The US cloud providers have enough problems trying to sell services abroad -- and domestically -- thanks to the government rules that under the Patriot Act, allow law enforcement agencies to access most data without judicial oversight.

Now a brief from the Office of the United States Attorney (10/30/12 pg. 4) claims that the agreements one signs when storing data in the cloud, "likely limit any property interest [one] may have in the data stored" and "may have severely limited any ownership rights."

A bit of background history: Last year the US Government seized the servers of Carpathia Hosting and for copyright violations, because they were hosting thousands of copyrighted materials, mostly movies and TV shows, without their legitimate owners' consent. But Megaupload was also storing data from thousands of users that kept their own files on Megaupload servers as part of their backup and storage strategy. According to the Electronic Frontier Foundation (EFF):

When the United States Government shut down access to Megaupload, a multitude of innocent users who stored legitimate, non-infringing files on the cloud-storage service were left with no means to access their data.

"EFF is troubled that so many lawful users of had their property taken from them without warning and that the government has taken no steps to help them," said Julie Samuels, staff attorney at EFF in a press release. "We think it's important that these users have their voices heard as this process moves forward."

Now, after the government's brief to the court, the EFF and some users affected by the Megaupload seizure are concerned that the rules the government tries to apply to this case affect the individual property of data stored in any cloud computing platform.

Another important issue in this case is privacy. When the government received the request from Mr. Kyle Goodwin (one of the Megaupload's cloud customers represented by the EFF) to recover his data hosted in the Caparthia servers as part of the Megaupload Cloud Service, the government agencies went to inspect and dissect Mr. Goodwin's files without consideration of his Fourth Amendment rights. Mr. Goodwin was not a suspect in the Megaupload investigation, he just used the cloud storage service for his personal files. The EFF, representing Mr. Goodwin, claims that "In the past, courts have required the government, when executing digital searches and seizures, to be mindful of and segregate third-party data to protect privacy concerns."

My email is hosted on the cloud, as well as my personal blog, my photo archive, and some private documents. If the FCC decides to seize some of Google's data servers and stop providing the email hosting service, is my email still secure? Can I get it back to move it to another provider? How long do I have to wait to get my data back, and to what extent can the government "browse" my data to try to limit my property rights?

How much will these cases affect the cloud computing business of American corporations? Amazon's cloud computing business represents around $2 billion a year of revenue for the company in the North America segment alone. (Amazon is not selling its Elastic Cloud services outside the US and Canada yet.) Google's new Compute Engine, now being offered as a limited preview trial, is available worldwide with competitive prices, but I doubt that any large European corporation will risk using an American cloud provider for their data.

My questions for international CIOs: How do you feel about the lack of protection of your property rights and confidentiality in the US cloud services? Are you using any cloud provider in the US? And, based on the US government policies and the US Patriot Act, would you consider cloud services hosted in the US or by any US corporation?

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ssl   Using Cloud 'Likely' Waives Data Ownership   12/6/2012 8:50:35 PM
hmm, so what does that mean for
All the government agencies (IE Dept Interior, NOAA, Agriculture,etc) who have embraced "the cloud"....  (Partly due to mandates that they consider cloud offerrings for cost containment)


Do they waive ownership of their data as well? :)


Susan Nunziata   Using Cloud 'Likely' Waives Data Ownership   12/5/2012 8:46:13 PM
Re: Not scared enough?
@Pablo: to the best of my knowledge, court orders are required in some cases in the U.S. but not in all cases. For example, here is a breakdown of requests by the U.S. for removal of content from Google along with the reasons. You can see the vast majority are by court order, but not all of them are.
stotheco   Using Cloud 'Likely' Waives Data Ownership   11/21/2012 2:15:53 AM
Re: where oh where
These issues are probably one of the reasons why there are many who are still hesitant when it comes to the cloud. They should straighten out the legislation involved and provide ample protection and adhere to privacy laws. This really is unfortunate.
stotheco   Using Cloud 'Likely' Waives Data Ownership   11/21/2012 2:15:42 AM
Re: Not scared enough?
Susan, well I was already scared when I was reading Pablo's post. So you can imagine how I feel after reading the link you posted. Scary, scary indeed. And a damn shame, too.
Damian Romano   Using Cloud 'Likely' Waives Data Ownership   11/20/2012 11:35:00 PM
Re: where oh where
@Sara - Yeah, it may sound kind of brash at first. But if you take the very concept to its grassroots and look at the potential this actually has, it does rip it out its very foundation. Cloud providers would be non-existent in a few years.
Sara Peters   Using Cloud 'Likely' Waives Data Ownership   11/20/2012 5:28:14 PM
Re: where oh where
@Damian  As you say, "It would in a sense destroy the whole model itself." At first blush that might seem like an alarmist statement, but I actually think you're 100 percent accurate.
Pablo Valerio   Using Cloud 'Likely' Waives Data Ownership   11/19/2012 5:28:34 AM
Re: Darkening clouds ahead
@Susan, protecting copyrights is important, but keeping the Internet free is too.

I remember that software companies were fighting software piracy very hard not long time ago, but they adjusted their business model, making software cheaper, and offering better service.

What is necessary is to change the business and distribution model of online content, something the music and movie industries are not willing -yet- to do, but at the end they'll have no choice. Many small studios and record companies are actively using the net, giving free music and selling albums only online at cheaper prices.

In Spain we have a saying "no se pueden poner puertas al campo". I think the english equivalent is "There's no use in locking the stable door once the horse has bolted"
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Pablo Valerio   Using Cloud 'Likely' Waives Data Ownership   11/19/2012 5:22:07 AM
Re: Not scared enough?
@Susan, I saw Google's Transparency Report, and the US Government requests for data are really scary.

I'd like to know if Google requires a court order in the US to handle confidential data to a government agency. I know that in the European Union is required, although the UK government has tried -unsuccessfully- to avoid that.
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batye   Using Cloud 'Likely' Waives Data Ownership   11/17/2012 2:08:22 AM
Re: where oh where
interesting, but like with everything first technology get created and law/regulations will follow...
singlemud   Using Cloud 'Likely' Waives Data Ownership   11/16/2012 9:45:49 PM
Re: where oh where
Great post. It is really scary,considering more and more people are moving to the cloud storage. The legislation apparently still does not consider this privacy and accessibility seriously.
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