If the government wants you, where you store your data doesn’t matter
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Who is the gatekeeper? Any time you are unable to say, that is me, then the thing that needs to be accessed belongs to someone else and you merely get the privilege to access it. Doesn't matter what contracts are in place. When the brown matter hits the rotary device, you can sue for breach of contract, tort or what have you, but "your" valuable stuff is "gone".
The compelling economic case for the cloud is "money for nothing and the chicks for free". You exchange your belongings for the illusion that you are now absolved from having to think about IT and IT infrastructure.