The New York Times says that Apple is hard at work making it more difficult for even itself to access iPhone data, but mentions one obstacle towards encrypting iCloud data:
One of the impediments to encrypting all the data in Apple’s iCloud servers, for instance, has been finding a way to ensure that customers can easily access and recover photos and other information stored there.
“Telling a member of the public that they’re going to lose all the family photos they’ve ever taken because they forgot their password is a really tough sell,” Mr. Soghoian said. “A company wants to sell products to the public.”
Security vs. convenience is ever the tradeoff. As a corollary to the old saw that the only perfect system is one with no users, the only way to make something truly secure is to make sure absolutely nobody can access it.
—Linked by Dan Moren