"This disclosure issue at Lavabit is one very good example of an organization's inability to maintain ownership and control of data in traditional cloud computing environments," said Elad Yoran, CEO of Vaultive, a vendor of cloud encryption technologies. "If a third party can turn our data over without our knowledge or authorization, do we really own or control our data in the cloud?" he said.
If a company maintains its own encryption keys, the government will need to make a legal request for the keys with the company and not the cloud provider, he said. Otherwise, all they would get from the cloud provider would be "encrypted useless gibberish," he said. "This puts the power of ownership back into the hands of businesses."
Richard Moulds, vice president of product strategy at Thales E-security said reports on the NSA's surveillance activities have heightened concerns over encryption key ownership in the cloud. "People are now beginning to ask 'why should I trust the cloud provider to look after the encryption keys?' " he said.
In theory, encrypting everything in the cloud is a great way to protect data from prying eyes, he said. [But] "key management is the Achilles heel of all cryptographic systems," Moulds said. "When you think about doing encryption in the cloud, who is going to own the keys?"
The problem with persistent encryption in the cloud is finding a way to make sure that all parties that require access to the encrypted data have the keys for decrypting it as needed, said John Pescatore, director of emerging security trends at SANS Institute.
"Encrypting data is easy, making sure the intended recipients, and only the intended recipients, can decrypt it" is challenging, he said.
Companies need to either find a way to make the decryption keys available as required or entrust a third party to distribute the keys in a secure fashion. "The former is expensive and hard to scale, the latter doesn't exist," Pescatore noted.
"For persistent encryption to work there has to be a trusted third party. But if you worry about government surveillance, you can't trust any third parties," which means being prepared to deal with a costly and complex in-house effort, he said.
Pravin Kothari, CEO of CipherCloud, compared most cloud encryption approaches to locking a car and leaving the key right next to the parked car. For companies to truly exercise control over their cloud data, some fundamentally new approaches are needed, he said.