Historically speaking, it has generally been understood within the security research community that Microsoft and its largest customer, the U.S. government, maintain a symbiotic relationship as it relates to the "leveraging" of Microsoft products for information operations. The government quietly leverages flaws in Microsoft's many product in support of national and domestic security initiatives, Microsoft turns a blind eye, its customers are generally none the wiser, and life goes on.
However, the revelations recently brought about by Edward Snowden have forced the hand of numerous technology companies that may have previously turned a blind eye to clandestine operations.
Earlier in November, Google employees angrily responded to reports of state surveillance of internal Google data by stating it had taken measures to encrypt internal, database replication traffic, thwarting the method reportedly used by NSA and Britain's Government Communications Headquarters (GCHQ) in the slide deck leaked by Snowden.
Now it's Microsoft's turn. Microsoft General Council Brad Smith went on record a few days ago at a shareholder meeting, stating: "We're focused on engineering improvements that will further strengthen security, including strengthening security against snooping by governments."
This is a significant move given Microsoft's relationship with the funder of at least one of the programs that it now seeks to thwart and its prior silence on the matter. Although Microsoft has not yet shared any details regarding the move, it will likely include similar precautions to those taken by Google -- i.e., enhanced protection of its wide area network traffic (particularly as it transits national borders) to make it more difficult for organizations such as the NSA to intercept traffic.
In the ongoing arms race that is the cybercapabilities market, more difficult almost always means more expensive. In other words, Microsoft's move will ultimately cost some of its largest customers millions of dollars in research and development, and they're proud to tell the world all about it.
The funds (taxpayer money) will be needed by organizations such as the NSA and GCHQ to identify and develop capabilities, which are akin to those that have been lost as a result of countermeasures implemented by Google, Microsoft, and others. This will surely change the dynamic of a historically symbiotic relationship and create new challenges when it comes to cooperation between the public and private sector, and when it comes to information sharing on cyberthreats and associated intelligence.
-- Update: Dec 8th --
Microsoft has release a statement on its public company blog specifying several areas in which it intends to focus its efforts in coming years as a direct response to government snooping allegations, as follows:
· Expanding encryption across our services.
· Reinforcing legal protections for our customers' data.
· Enhancing the transparency of our software code, making it easier for customers to reassure themselves that our products do not contain back doors.
Tom Parker is CTO at FusionX