First Two Microsoft Data Centers Coming to Canada in 2016

Microsoft announced plans to establish two data centers in Canada that will provide its cloud services to customers in the country.

The data centers in Toronto and Quebec City will be the first Microsoft cloud locations in Canada. The cloud services used by about 80,000 Canadian businesses today are served out of Microsoft data centers outside of the country.

The announcement may be welcome news for those in Canada who are concerned with data sovereignty, or the idea that access to data that’s stored within a country’s borders should be governed by that country’s laws. Data sovereignty and data privacy concerns have reportedly heightened around the world since former U.S. National Security Agency contractor Edward Snowden leaked information about the agency’s widespread electronic surveillance capabilities.

Cloud service providers like Microsoft and Amazon have used these concerns as a way to make their services more attractive by building more data centers outside of the U.S.

Amazon mentioned Germans’ concern with data sovereignty when it opened a Frankfurt data center to support its cloud services last October. And Microsoft did the same in its announcement of the upcoming data centers in Canada: “These new locally deployed services will address data residency considerations for Microsoft customers…”

As Microsoft’s recent legal tussle with U.S. federal law enforcement officials, however, illustrates that it’s not enough to simply build a data center in a foreign country to ensure data stored there cannot be accessed by the U.S. government.

A U.S. federal court ruled last year that Microsoft must hand over personal data of one of its customers stored in its data center in Dublin, Ireland, the feds had requested. The company has appealed that decision. A ruling has not yet been issued.

A more clear-cut data sovereignty angle for cloud data centers in Canada may be providing services to Canadian government agencies. The government is in the process of crafting rules for using and providing cloud services, and one potential requirement may be that the data is stored within the country’s borders.

The two Microsoft data centers in Canada are due to come online next year. They will support Azure, Office 365, and Dynamics CRM Online.

Google, one of Microsoft's biggest rivals in the cloud services market, made two new data center construction announcements this week: one in Singapore, and the other in the Atlanta metro.