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There are red faces in Redmond after Edward Snowden released a new batch of documents from the NSA's Special Source Operations (SSO) division covering Microsoft's involvement in allowing backdoor access to its software to the NSA and others.
Documents seen by The Guardian detail how the NSA became concerned when Microsoft started testing Outlook.com, and asked for access. In five months Microsoft and the FBI created a workaround that gives the NSA access to encrypted chats on Outlook.com. The system went live in December last year – two months before Outlook.com's commercial launch.
5.2. Does Microsoft disclose my personal information outside of Microsoft? You consent and agree that Microsoft may access, disclose, or preserve information associated with your use of the services, including (without limitation) your personal information and content, or information that Microsoft acquires about you through your use of the services (such as IP address or other third-party information) when Microsoft forms a good faith belief that doing so is necessary (a) to comply with applicable law or to respond to legal process from competent authorities; (b) to enforce this agreement or protect the rights or property of Microsoft or our customers; or (c) to help prevent a loss of life or serious physical injury to anyone.