How trustworthy is Microsoft's "data trustee"?

Yesterday Microsoft announced a radical new structure for some of its European data centres. In an attempt to put customer data beyond the reach of the US government, it has entered into a relationship with Deutsche Telekom which will operate new European facilities on its behalf and act as "trustee" for data held there. The aim is that:

[Microsoft] employees will have no access to the data held at the facilities without the German company’s permission. The companies believe this arrangement means Microsoft will not have to respond to governmental demands for information held in these data centres, forcing official requests to go through German authorities instead.

This is a direct response to the ongoing US litigation asserting that the Stored Communications Act has extraterritorial effect and captures data which Microsoft holds in Dublin or anywhere else worldwide. The harm to its European cloud operations has forced Microsoft's hand - rather than waiting for the result of the appeal in that case (or proposed amendments which would cut back the extraterritorial effect of US law) it has opted to put itself in a position where it simply can't comply with US demands.

But how trustworthy is Microsoft's trustee? Deutsche Telekom looks like an unfortunate choice. It's probably best known in privacy circles for systematically using its phone records to spy on journalists writing critical stories about it - including tracking journalists' movements using mobile phone data. It's deeply ironic that Deutsche Telekom now sees privacy as a selling point when it previously spied on its users not in response to government demands but simply for its own commercial advantage.