Obviously govenment is just trying to pass the buck.
Okay so the TERRist has a hotmail account and the government can now see everything. BUT the suspected terrorists post nothing of the kind to each other using their hotmail. Instead they use a peer to peer instant messaging client that uses public/private keys to encrypt their direct communication with each other.
So obviously now that they can chat in secret it must obviously be large corporations fault.
1. ISP can't see a thing other then source/destination. Can somewhat but not completely be hidden by TOR
2. There is no large corporation to blame as they are not using server-side services. Nothing to trawl through.
3. Unless they have broken TLS/SSL keypairs some how then they cannot view the contents of the data unless they get hold of each of the private keys from the individuals.
4. It does not require very much knowledge to use encrypted chat clients. Just a few internet searches to see what programs + features are available and that is it.
I am all for nailing these terrorist rats to a wall but simply passing the blame just goes to show how little they care and simply want a nation of blanket monitoring. The government needs to take responsibility for their own inaction.