Microsoft sets up data centers in Germany amid US surveillance concerns

German data trustee, T-Systems, will control and oversee all access to customer data

Microsoft is delivering its cloud services, including Azure, Office 365 and Dynamics CRM Online from two new datacenter regions in Germany, in a move that aims to deflect customer concerns about access to their data by U.S. surveillance.

The data centers, located in Magdeburg and Frankfurt am Main, will be unusual in that control over the data will not be with Microsoft but with Deutsche Telekom subsidiary T-Systems, which will be acting as a data trustee for Microsoft's customers' data.

Access to customer data stored in these new datacenters will be under the control of T-Systems and Microsoft will not be able to access the data without the permission of customers or the data trustee, Microsoft said in a statement Wednesday. If permission is granted by the data trustee, Microsoft will access the data only under its supervision.

The roll out of the data centers is scheduled for next year with availability of services planned for the second half of 2016. Services will be available to customers in Germany, the European Union and the European Free Trade Association.

The move by Microsoft is apparently aimed at assuaging German concerns about storing its data with a U.S. cloud company, particularly after revelations by former U.S. National Security Agency contractor, Edward Snowden, about large-scale NSA surveillance in the country and abroad.

Microsoft and other tech companies faced a setback last month when the Court of Justice of the European Union declared invalid a "safe harbor" agreement governing personal data transfers between the EU and the U.S., as the data was not protected from spying by U.S. agencies.

The Redmond, Washington-based software company is also resisting in an appeals court in New York demands from the U.S. government for access to emails of a person that are stored in a server in Ireland.

Deutsche Telekom is supervising access to the infrastructure that houses customer data at the high-security data centers, while also providing connections over its network between the data centers.

On Tuesday, Microsoft announced plans to offer its Office 365 and Azure services from data centers in the U.K. by late next year.  Rival Amazon Web Services has also announced plans for a U.K. data center cluster by early 2017.

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