For all the implied promises of cloud-based computing, data doesn’t just hover in the air — it also has to have an earthbound home in the form of a server. Because those servers can be anywhere in the world — and, consequently, under the auspices of local laws — the location of the servers storing a company’s own data and/or customer information can have serious privacy and human rights implications. “Once you put data on a server in a particular country, you are definitely subjecting that data to the jurisdiction of the local authority,” explains Vivek Krishnamurthy, an associate in Foley Hoag’s Washington, D.C., office, who authored a recent memo called “Why Every Company Needs a Geolocation Policy.” As the memo details, government authorities typically have a “nuclear option” in order to obtain identifying data about users: either “physically raiding a data center or holding one or more employees in contempt of court for failing to turn over the data being sought.” The corollary is that legal frameworks for protecting privacy and freedom of expression vary around the world, including among established democracies. “There is a lot of concern in the internet user community and the internet activist community about where exactly companies are locating data,” Krishnamurthy says. Companies have a lot on the line, too: the safety of employees and their interest in protecting the integrity of company data, including proprietary information. “I think companies should also be wary about where they locate sensitive internal data,” he says. As companies expand into overseas markets and the demand for remote computing services grows, they face “two different pressure points,” Krishnamurthy says:
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