Microsoft is trying to lessen the European distrust of cloud services that are operated in the United States by opening data centers located in Germany. The data centers will be run by a third party company, and they will offer Microsoft services such as Azure, Office 365 and Dynamics CRM Online.

Microsoft CEO Satya Nadella said, “This will offer customers in Germany and Europe choice and trust in how their data is handled and where it is stored.”

The German Microsoft Cloud will be offered to customers as a new option for the storage of local data. Microsoft will make a strong effort to ensure that the data is fully secure and protected. The company believes that it will appeal to many German businesses, as a recent study found that 83% of German companies expect that a cloud storage system should be operated in their country.

People in Europe have been largely concerned about the potential for mass surveillance from the United States government. Europeans have been particularly worried about the data security of commercial cloud storage. Additionally, there is legal uncertainty following the elimination of the Safe Harbor Agreement between the United States and Europe.

The German Microsoft Cloud will launch sometime in the second half of next year. It will be operated by T-Systems, a subsidiary of Deutsche Telekom. Microsoft has stressed that it will not have any access to customer data without the permission of T-Systems. As a result, Microsoft promises that the data will be under total control of German companies.  

Additionally, Microsoft has been working to expand its regional presence in Europe by establishing data centers. The company has already announced that local data centers will be forming in the United Kingdom, Ireland and the Netherlands. Microsoft currently has more than 100 data centers in 24 different regions which serve more than 24 countries worldwide. These data centers consist of a mixture of public, partner, private and hybrid cloud services.

Still some analysts are skeptical that the German data centers will be subject to German law rather than law in the United States. Although Microsoft insists that German companies will be in control of the data, with Microsoft being an American company, United States law could mandate otherwise.

Cloud computing analyst Paul Miller said, “Microsoft’s lawyers and T-Systems’ lawyers argue that the German Data Trustee model, which is at the heart of this week’s deal and is governed by German law, will be effective in shielding data from U.S. demands. But, to be sure, we must wait for the first legal challenge. And the appeal. And the counter-appeal.|

Miller also said that more harmonized laws are needed at a global level in order to establish certainty for companies regarding the security of data. However, this is likely still a long ways off.

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