Apologies for the long rant but this article is a bit reminiscent of a Michael Moore movie or even some Fox news reporting, viz. anecdote driven, one-sided and alarmist.
As with any
service provider, Google is not infallible. Witness the security leaks at some of the major banks over the past few years (who are routinely audited by various gov't entities to ensure compliance with some extremely stringent privacy and security protocols) and even the US government (think: wikileaks).
Unlike a lot of service providers, though, Google is doing a laudable job of making data stored in their systems portable. Exhibit A: http://www.dataliberation.org/
Consumers, like enterprises, need an appropriate backup plan. This could, but doesn't have to, include ensuring that important data stored in various cloud services are backed up elsewhere.
Like others on this thread, I'd love to see a consumer-facing, hardened storage service that pulls data down from popular cloud services (many of them free) on a user's behalf. Think Mint.com meets Iron Mountain for email, pictures, docs, misc. files, financial data, etc.
Between now and then, though, I'd really like to see technology journalists provide a more balanced perspective. How many people use Google Docs, Gmail, etc. without issue? I'd bet that the percentage of people who run into non-user-caused problems is well less than 1%. To wit, the widely reported Gmail data loss issue on 150K accounts a few months ago affected 0.08% of their user base.
Of course, I would not have liked to have been one of those users but let's keep things in perspective before we start warning users of the impending peril of cloud storage, titling articles "Why you shouldn't trust Google (or any cloud service) with your data."