But isn't this just like forcing these businesses to be a free-of-charge private cloud storage for the government? Oh, silly me, of course there's gonna be payola bigtime for providing a service like this.

If the government can query the whole trove whenever she deems there is a need, what difference does it make where the hard drives live?

Just more lacklustre theatre where nothing really changes and the partners/cronies get some extra loot.