With all of the NSA hype spreading around again (and quite frankly I agree with some of it though I won't discuss the sensitive matter here), Google is trying to take a bigger step in ensuring it's customers that their data is safe with them.
As of now, newly uploaded data is encrypted and stored on Google's servers. When the user is ready to retrieve data, data is decrypted and sent back to the user. Google says that there will be no performance impact from doing this, despite more steps to uploading/retrieving files being added.
As for existing data already stored on Google Drive, the data will be encrypted too but the migration can take a few months.
Of course, if you are wanting to have maximum security while using a cloud service, the best thing to do is encrypt your data yourself before uploading it. If you want something a bit more safe that than, then you should look into hosting your own cloud data server, like OwnCloud.
What do you think about this move? Do you think other competitors such as Dropbox and SkyDrive will hop on this bandwagon?