Patriot Act Threatens American Cloud Computing

The PATRIOT Act is generating concern among cloud users around the world, who suspect that the United States government, which now has easy access to any American-made platforms, will access their private data.

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United Kingdom defense contractor BAE Systems planned to adopt Microsoft’s (NASDAQ:MSFT) Office 365 cloud-based productivity platform, but was warned against it by their lawyers. Though BAE Systems would be operating outside the U.S., Microsoft’s headquarters are in the U.S., and the company is subject to U.S. laws.

While Microsoft must abide by the laws in the countries where the subsidiary companies are located as well, if the U.S. government were to request any data from Microsoft, the company would be required to turn it over. Though the government must have reasonable cause for invoking the Patriot Act, European businesses worry that there are few checks to the system, and object to what seems to them unlimited access.

Seventy percent of European companies have expressed concerns about using American cloud programming, and now many are using that fear as a marketing tool, advertising themselves as being immune to American legislation simply because they do not use American cloud platforms

Cloud companies owned and operated locally within the European Union are attracting the business of European companies, as well as U.S. companies with European operations hoping to hide their data from prying eyes.

The Patriot Act now threatens American companies, which are suffering from a great marketing disadvantage. Even China may soon lift restrictions, allowing their Cloud Valley to prosper, while U.S. cloud companies dry up, and the era of American entrepreneurship and innovation in technology faces a major hurdle.

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To contact the reporter on this story: Emily Knapp at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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