The difference is they don't hand over the data of all their users but of specific ones, just like every other entity does if you have a warrant for that user.
The issue becomes far more pronounced if the state is able to determine your identity through your phone number, which in Germany is usually tightly coupled to your identity.
I don't need 3rd rate officials being in a position to judge my communication for some badly defined security benefit that allegedly would manifest for the whole society.
Plus Germany still has quite a bad record here. After WWII it didn't stop to invent new forms of totalitarianism through surveillance.