This bug was fixed in the package cloud-init -
17.2-35-gf576b2a2-0ubuntu1~16.04.2
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cloud-init (17.2-35-gf576b2a2-0ubuntu1~16.04.2) xenial-proposed; urgency=medium
* cherry-pick 40e7738: GCE: fix reading of user-data that is not
base64 encoded. (LP: #1752711)
cloud-init
I've just pushed a commit to cloud-init's upstream packaging for this at [1]
It should get pulled into the next ubuntu Stable Release of cloud-init.
A "cloud-init daily" ppa build should occur tonight and arrive at [2].
You can test that PPA with:
sudo add-apt-repository
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