Microsoft Corp worked closely with U.S. intelligence services to help them intercept users' communications, including letting the National Security Agency circumvent email encryption, the Guardian reported on Thursday.
Citing top-secret documents provided by former U.S. spy contractor Edward Snowden, the UK newspaper said Microsoft worked with the Federal Bureau of Investigations and the NSA to ease access via Prism - an intelligence-gathering program uncovered by the Guardian last month - to cloud storage service SkyDrive.
Microsoft also helped the Prism program collect video and audio of conversations conducted via Skype, Microsoft's online chat service, the newspaper added.
Microsoft had previously said it did not provide the NSA direct access to users' information. On Thursday, it repeated that it provides customer data only in response to lawful government requests.
"To be clear, Microsoft does not provide any government with blanket or direct access to SkyDrive, Outlook.com, Skype or any Microsoft product," the company said in a statement on its website.
Facebook Inc, Google Inc and Microsoft had all publicly urged U.S. authorities to allow them to reveal the number and scope of the surveillance requests after documents leaked to the Washington Post and the Guardian suggested they had given the government "direct access" to their computers as part of the NSA's Prism program.
PRISM is a clandestine mass electronic surveillance program operated by the United States National Security Agency (NSA) since 2007. PRISM is a government code name for a data-collection effort known officially by the SIGAD US-984XN.
PRISM began in 2007 in the wake of the passage of the Protect America Act. The program is operated under the supervision of the U.S. Foreign Intelligence Surveillance Court (FISA Court, or FISC) pursuant to the Foreign Intelligence Surveillance Act (FISA). Its existence was leaked five years later by NSA contractor Edward Snowden, who warned that the extent of mass data collection was far greater than the public knew and included what he characterized as "dangerous" and "criminal" activities. The disclosures were published by The Guardian and The Washington Post on June 6, 2013.
A document included in the leak indicated that PRISM was "the number one source of raw intelligence used for NSA analytic reports." The leaked information came to light one day after the revelation that the FISA Court had been ordering a subsidiary of telecommunications company Verizon Communications to turn over to the NSA logs tracking all of its customers' telephone calls on an ongoing daily basis.