Microsoft's Ray Ozzie: 'Nobody's going to be 100% open'

Is Microsoft's cloud bigger than the law?

As Microsoft and its competitors expand their cloud computing services, for the first time, entire computing platforms will commonly cross country's boundaries. There are laws governing interstate transport, even among members of the EU; and now, those laws will apply to computing systems just as though sovereign boundaries separated the CPU from RAM.

In recent dealings with issues of privacy, interoperability, and fairness as they pertain to certain governments around the world, it often seems -- at least to this reporter -- that it's difficult to know what the new ground rules are until the referee takes the field to declare the first out-of-bounds penalty. This is an observation I raised with Ray Ozzie and Bob Muglia: How does Microsoft plan, going forward, to communicate with governments what its plans are, without tightening the boundaries for itself?

"There's no single answer to that question," Muglia responded. "What we have is, we are engaged in conversations with governments all around the world, and when I talk about the cloud being nascent and emerging, this is an example of emerging characteristics of the cloud: understanding how it will exist in the regulatory environment, in all of the different countries and geographies that it has to work in. So as we begin to bring services out to businesses and users within a given geography, we have to, we have to operate in the legal context that's established by the government agency. There's complexities in some parts of the world where you get into issues about privacy and government control over access to information, and things like that. Those are just things you have to understand how to operate in, and what sort of steps you need to take.

"So we're engaging with them," he continued. "And I think we're all learning a bit together. I don't think the laws will exist the same way today -- ten years from now, I think they'll have changed, they'll have evolved. You had the concern that they will get tighter; that probably will happen, in some cases, and in other cases they will probably get looser. As people see that government restrictions prevent prosperity within their country as organizations and individuals aren't able to do some of the things they might want to do, if some of those restrictions weren't there."

Ray Ozzie picked it up from there: "The best analogy I've been able to come up with is, late '80s, early '90s, there were a lot of crypto export issues. There was a real disconnect between what we were trying to do as a technology industry, and what customers wanted to do, and the regulations. And right now, there are some things that don't make sense to technologists. Like the fact that you cannot have a copy of this kind of data -- whether it's health data, or whatever -- on the other side of a border, for a citizen of a given country. Almost as though encryption doesn't exist, in terms of, where should the keys be versus where should the data be? And there was a big lag in terms of getting the regulations changed over time, and we really don't regard it as much of a problem as an industry any more, for the most part.

"The big difference between cloud computing and crypto -- and the reason I'm optimistic that things will change sooner -- is that governments themselves want to use cloud computing. There are some really significant economic issues related to people within governments building massive data centers where they maybe shouldn't, maybe they don't need to, and so I'm optimistic that some of these things will have a lot more [progress]...The pragmatic need to embrace cloud computing themselves will put them in a situation where they might go, 'Okay, there is this economic benefit; now I understand what these people are talking about.'"