Aren't you forgetting the part that says "solely: (a) to perform its obligations set forth in the Terms, including its Support obligations as applicable; (b) to derive and generate Telemetry (see Section 4.4); and (c) as necessary to comply with applicable Laws. Except as required by applicable Laws, Zed will not provide Customer Data to any person or entity other than Customer’s designees (including pursuant to Section 7) or service providers."
Seems like legalese to be able to take that data for support reasons, telemetry, and local laws that require that data be sent to them. I think ignoring this portion is a little uncharitable to them.