In my opinion, this explanation would be fine if they were just an everyday person who has no knowledge of the law. But this was companies with lawyers who were asked to assign facilities, resources, technology, and reroute their networks to make this happen. This is unprofitable, and unprofitable is not the way you run a business. They wouldn't just expend all these resources without looking for a way around it. You certainly don't expend money on doing something like this for free. In my opinion, this was a calculated move by the telecoms to benefit elsewhere. They most certainly had their lawyers look at it, and were in collusion with some part of the Govt. to get this setup. Either they got something out of it or their hands were forced and either way it was wrong, and it should have been taken to court and publicized instead of being hidden and co-operated with. Just because someone in authority tells you to do something does not mean you blindly follow, and these large companies were blindly following instead of protecting their customers privacy which is part of what we pay them to do.
Violating peoples privacy is out of bounds for any level of authority without a proper justification. Our society has recognized the warrant to be that justification.