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You are here: Home / Customer Data / MS To Store EU User Data in Germany
Microsoft To Store EU User Data in Germany, Away from U.S. Spies
Microsoft To Store EU User Data in Germany, Away from U.S. Spies
By Jennifer LeClaire / CRM Daily Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
At its Future Decoded event in London today, Microsoft announced plans to offer European customers a new option: storing cloud data in Germany instead of the United States. Redmond is working hard to deal with growing concerns about the security of data centers in the U.S.

Those concerns come after reports of increased surveillance of corporate data by U.S. intelligence agencies, including the National Security Agency. Microsoft is being proactive, hoping to win customers with an alternative that, at least on the surface, appears to offer more security and privacy.

Microsoft CEO Satya Nadella also announced several investments in the Microsoft Cloud in Europe that could drive economic innovation and economic growth, further incentivizing customers to migrate to its data centers.

“Responding to rapid growth in customer demand across Europe, Microsoft announced plans to deliver commercial cloud services from datacenter regions in multiple cities within the U.K. and announced the expansion of regional hubs in Ireland and the Netherlands,” said Doug Hauger, general manager of National Cloud Programs at Microsoft, in a statement. Microsoft Azure and Office 365 will hit the market in U.K. data centers in late 2016. Dynamics CRM Online will follow soon after.

Trumpeting the Trust Factor

That’s big news, but what most industry watchers are highlighting is the Germany deal that will see a data trustee under German law control access to customer data. Microsoft said it is the first global, hyper-scale cloud provider to offer this model.

Germany’s Deutsche Telecom will serve as the data trustee. The Microsoft Cloud in Germany will roll out for European customers during the second half of 2016. These new cloud offerings and facilities give customers and partners more flexibility and options as they work to drive innovation and the revenues that follow, according to Hauger.

“These new regions will adhere to the same service and quality standards of all Microsoft Cloud regions,” Hauger said. “In addition, the services will feature the same industry-leading levels of security, privacy and control, compliance, and transparency that define the Microsoft trusted cloud. Microsoft is committed to innovating to meet the needs of its customers, and understands that customers and partners will only choose technology they trust.”

Will This Hurt U.S. Jobs?

We caught up with Rob Enderle, principal analyst at the Enderle Group, to get his thoughts on Microsoft’s data center announcement. He told us this is part of the downside of the National Security Agency’s aggressive spying operations -- foreign governments no longer trust U.S. companies.

“To mitigate this Microsoft and others are having to invest in much more robust and expensive local resources shifting efforts that would have generated U.S. revenues to efforts that leave these revenues, the related jobs, and the related data, in Europe,” Enderle said.

This is another example of how the U.S. government is working against the U.S, he added. "I expect, once the dust fully settles -- and especially for cloud services -- much of what otherwise would have been a huge opportunity for U.S. jobs and revenue growth will instead now happen in Europe as the related companies adjust for the new regulations.”

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