FTC worries about cloud data

ars technica has a great story about the FTC believing consumers don't have a clue about the privacy implications.

While cloud storage is not a very new concept, the use of the cloud by consumers is picking up now that pricing for these services is acceptable for most.  I am just talking about personal storage from services like Amazon and Rackspace.  Personally, I keep backups of my blog and associated plugins, etc. on Amazon S3.  For any development work I do, I also store out on S3 and light up BitTorrent streaming to others I am working or sharing code with.  Once the seeding is complete, I shut down the BitTorrent in S3 to save on Data Transfer Out charges. In the end, I don't keep a lot of data in the cloud myself because of this. Oh, I did consider dumping my local NAS content (MP3s, videos, photos, etc.) out there, but I could get a few external USB drives for what it would cost to store all that.

In any case, the article uses the Nexus One (Google Phone) as an example. How timely, huh? All of the personal data, browser history, contacts, etc are backed up to the cloud so that the data could be restored to a different phone in the event the current one is replaced.  Of course, many carriers are taking this approach to backup your phone data to assist in changing phones.

ars makes a good point about that data being accessible to Google for search (definitely), hackers (possibly), and law enforcement (watch the privacy disclosures).  If you have Google accounts (GMail, Calendar, Docs, etc.), you know that data is searchable and that Google will attempt to hold back law enforcement unless an active investigation or subpoena is enacted, but privacy terms also change.

What do you think? Is your data protected in the cloud like it would be on your own systems?