Yahoo! Inc. ais following Google Inc 's lead and will encrypt all information that moves between data centers and will allow users to encrypt all data transmitted to or from Yahoo by the end of 1Q2014, The Next Web reports. The company also said that it will try to get its Mail partners to enable HTTPS, but hasn't given any hard deadlines for when that would happen.
Marissa Mayer’s claim on Yahoo data centers
Yahoo! Inc. CEO Marissa Mayer also claimed that the company "has never given access to our data centers to the NSA or to any other government agency. Ever."
If Mayer's claim turned out not to be true it would be a big blow to the company's credibility, but right now tech companies aren't really allowed to talk about their relationship with the NSA, and Google Inc has asked Congress to let it release aggregate data, so if she's bluffing there's not much chance of getting called out. Tech companies denied National Security Agency involvement for years before Edward Snowden leaked information on NSA domestic spying operations.
NSA has hacked into Yahoo and Google data centers
Even if Yahoo! Inc. didn't actively cooperate with the NSA, Snowden recently claimed that the agency had hacked into both Google Inc and Yahoo data centers and that it has been able to access user data more or less at will using a tool called MUSCULAR that intercepts and copies data as it is being transmitted across fiber optic cables. This is separate from the PRISM program that has been at the center of the NSA scandal so far and potentially even more controversial because private companies' security was being compromised without their consent. Improved encryption of information moving between data centers is an attempt to push back against the MUSCULAR program.
Snowden's revelations have damaged the American tech sector's international reputation because companies now have to wonder who has access to the data they store on any US-based server. It's not just a matter of companies who have something illegal to hide, many people were shocked that an outside contractor was able to access so much classified information and the lack of oversight that implies. Yahoo! Inc. and Google Inc will need to both defend against MUSCULAR and push for transparency around PRISM to protect their international reputations.