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In view of the UK government's new internet snooping proposals can anyone answer this question about the physical location of our data?

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This is an interesting question, but I don't believe the answer will mean anything in terms of the UK government proposals. – 8128 Jun 21 '12 at 11:24

Ubuntu One uses Amazon's S3 service in datacenters around the world. There are no UK datacenters listed on S3's website, though this could change.

To answer your question directly, S3 Datacenters (holding your Ubuntu One data) are in the following countries: USA, Ireland, Singapore, Japan, and Brazil. None of those countries are part of the UK.

If you don't trust one or more of these governments with your data, see this question on encrypting your data in Ubuntu One.

EDIT: Here is the Ubuntu One technical details page confirming they use S3

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