Earlier quoted context omitted.
You left out the circumstances under which they will share your data. > comply with applicable law or respond to valid legal process, including from law enforcement or other government agencies; > protect our customers, for example to prevent spam or attempts to defraud users of the services, or to help prevent the loss of life or serious injury of anyone; > operate and maintain the security of our services, includin…
I understand that there are legal barriers around it per the privacy policy but the fact that someone at Microsoft can just decide that they need file X off my laptop and then fetch it is way beyond the pale. If someone wants the files off my laptop, they can get a search warrant and successfully convince my lawyer that I am legally obliged to decrypt.
If your argument is that they could implement such a capability, that's always been true for any OS, including free operating systems, unless you audit the code and compile it yourself.