Mumbai: Chinese smartphone maker Xiaomi said it plans to set up a data centre in India next year to store local user data, as the fast-growing company seeks to deflect concerns about privacy that could hamper its efforts to expand overseas.
The move by privately owned Xiaomi comes after it said last week saying it was migrating some data on non-Chinese customers away from its servers in Beijing due to performance and privacy considerations.
Xiaomi, whose low-priced but feature-rich smartphones have made it the biggest smartphone vendor in China, entered India this year with plans to invest heavily to secure rapid growth in the world's third-largest smartphone market.
It sells its phones in India via Flipkart.com, the country's biggest online retailer, and said last month it planned to sell 100,000 phones a week in the country in October.
On Monday, Xiaomi said it had been moving Indian users' data from its Beijing data center to data centers of Amazon Web Services, the cloud computing platform of the online retailer Amazon.com Inc, in Singapore and the United States since early 2014. It said that process would be completed by the end of the year.
Xiaomi has faced several privacy controversies, including accusations from international security researchers and a government agency in Taiwan that it funnels unauthorized user data back to its servers in Beijing. Indian media reported last week that the country's air force had issued alerts to its personnel and their families against using Xiaomi phones on security concerns.
The Chinese company said on Monday it was attempting to contact Indian authorities for more details on local media reports, adding that it did not collect user data without permission.
Full text: Clarification regarding privacy from Xiaomi India
There have been reports about an IAF circular claiming that Xiaomi phones are a security threat. While we are attempting to reach Indian authorities to learn specifics, we would like to clarify a few points to assure our users that we treat your privacy seriously.
1. We provide opt-in secure Internet services that greatly benefit users
We offer various opt-in Internet services that bring great user benefits, are free of charge, and require personal data to be stored in the cloud. For example:
- Mi Cloud enables users to back up their data as well as sync it to other devices
- Cloud Messaging allows users of Mi devices to exchange text messages free of carrier charges by routing messages via IP instead of carrier's SMS gateway
These services are optional (opt-in). Users can turn them on and off at any time. Users can also opt to use similar services from other Internet companies instead, such as Google, Whatsapp, Dropbox and others.
2. We do not collect user data without permission
We do not collect any data associated with services such as Mi Cloud and Cloud Messaging until the user provides explicit consent by turning on the corresponding service(s). Even after users have turned on these services, they can turn them off at any point of time.
We take rigorous precautions to ensure that all data is secured when uploaded to Xiaomi servers and is not stored beyond the time required.
3. We use very high encryption and security standards to protect user data
- We encrypt data using AES-128 standard before storing, which makes it practically impossible for anyone to steal this information
- We protect user passwords and identifiers such as IMEI number using cryptographic one-way hash functions *before* they're uploaded, which means we never actually receive the original information
- No single person, including Xiaomi employees, can decrypt user data stored in Mi Cloud, even if they get access to the hard drives
- We use extremely strict access control policies with multiple authorizations being required for engineers building services that access any personal data
- All access to servers is logged and audited
4. We are moving our Indian users' data to servers outside of China, and to India in 2015
Since early 2014, we have been migrating our services and corresponding data for Indian users from our Beijing data centers to Amazon AWS data centers in Singapore and USA. Parts of this migration will be completed by the end of October, and all of it will be completed by the end of 2014. In 2015, we plan to launch a local data center in India to serve the needs of (and store data for) our Indian users.
These efforts help significantly improve the performance of our services and also provide some peace of mind for users in India, ensuring that we treat their data with utmost care and the highest privacy standards.
For detailed information, refer this recent post by Hugo Barra on this:
https://plus.google.com/110023707389740934545/posts/9ARVCHczyvb
5. The concerns raised by F-Secure have been fully addressed
We believe the advisory circular issued by IAF is based on events about 3 months back. It refers to the F-Secure test done on the Redmi 1S in July 2014 about the activation of our Cloud Messaging service (which enables users to send text messages for free, similar to other popular messaging services).
We immediately addressed the concerns raised, which was directly acknowledged by F-Secure 4 days later.
Please refer to this post by F-Secure confirming their concerns were addressed:
http://www.f-secure.com/weblog/archives/00002734.html
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