Apple begins storing users' data on servers in China

Apple Inc has begun keeping the personal data of some Chinese users on servers in the Chinese mainland, marking the first time the tech giant is storing user data on Chinese soil.

The storage of user data in China represents a departure from the policies of some technology companies, notably Google Inc, which has long refused to build data centers in China due to censorship and privacy concerns.

Apple said in a statement released over the weekend that the move was part of an effort to improve the speed and reliability of its iCloud service, which lets users store pictures, e-mail and other data. Positioning data centers as close to customers as possible means faster service.

The data will be kept on servers provided by China Telecom Corp, the country's third-largest carrier by subscribers, Apple said in the statement.

"Apple takes user security and privacy very seriously," it said, noting that the company has added China Telecom to its list of data center providers to increase bandwidth and improve performance for its customers in the mainland.

"All data stored with our providers is encrypted. China Telecom does not have access to the content," it said.

A source with knowledge of the situation said the encryption keys for Apple's data on China Telecom servers would be stored offshore and not made available to China Telecom.

Apple has said it has devised encryption systems for services such as iMessage that even Apple itself cannot unlock. But some experts expressed skepticism that Apple would be able to withhold user data in the event of a government request.

"If they're making out that the data is protected and secure that's a little disingenuous because if they want to operate a business here, that'd have to comply with demands from the authorities," said Jeremy Goldkorn, director of danwei.com, a research firm focused on Chinese media, Internet and consumers.

"On the other hand if they don't store Chinese user data on a Chinese server they're basically risking a crackdown from the authorities."

Goldkorn said that data stored in the US is subject to similar regulations where the government can use court orders to demand private data.

A spokesman for China Telecom declined to comment.

With its rising middle class, China has become an increasingly important market for Apple. Sales of the iPhone rose almost 50 percent in China in the three months ended June and salvaged an otherwise lackluster quarter for the Cupertino company.

But Apple has frequently come under fire from Chinese State media, which accused the company of providing user data to US intelligence agencies and have called for "severe punishment."

The US company has strongly denied working with any government agencies to create back doors into its products or servers. "We have also never allowed access to our servers. And we never will," Apple has previously stated.