NSA spying may be harming American tech companies’ bottom line

There's been much speculation that Edward Snowden's revelations about the NSA spying program PRISM have damaged U.S. tech companies' credibility among international clients who were the operation's primary targets. But Andrea Peterson at the Washington Post writes that "it’s starting to look like the snooping is hitting U.S.-based cloud providers where it really hurts: Their pocketbooks."
Computer World UK reports a recent Cloud Security Alliance (CSA) survey found 10 percent of 207 officials at non-U.S. companies canceled contracts with U.S. providers after the leaks, and 56 percent of non-U.S. respondents are now hesitant to work with U.S.-based cloud operators. This is bad news for U.S. tech companies because cloud computing and storage is a huge, expanding market. Research firm Gartner forecasts the public cloud services market will grow 18.5 percent in 2013 to a total of $131 billion worldwide.

Notable Replies

  1. Why yes it is - I removed Skype from my computer this very morning - no more business from me so long as you help your government spy on me

  2. Before anyone says it - this is not Snowden's fault. This is the fault of the hubristic morons at the NSA who are actually abusing their power.

    They were operating on the assumption that because a lot of the internet happens in the US right now, it will continue that way forever. That assumption is false, and they have gone a long way to ensuring that there will be a strong interest in setting things up differently and elsewhere.

  3. It's not just loss of foreign business that will affect our tech companies. Until Congress makes a strong, unambiguous privacy law, AND we have assurance that our deceitful government will actually obey it, my personal data is out of the cloud. Have switched to a zero-knowledge online backup, and pulled my data out of Evernote into local storage.

    Can anyone recommend a video chat that's secure from intrusion?

  4. 939 says:

    Check out Jitsi, an open source SIP and XMPP client supporting encrypted text, voice, and video chat. Other more secure alternatives to mainstream software can be found at http://prism-break.org

  5. Because they are easy to use and ubiquitous? Tech companies can fight, but there's an equation under every fight: will the fight cost more than the compliance? In other words, to put money into a legal fight has to be less than the cost of consumer flight months or years down the line when they find out about it. And it's a gamble. Some places will gamble and push back and other places will gamble and not push back. The root cause, though, isn't the tech companies. The fault lies in the Agencies' abuse of power, and deeper still, the fault is with Congress and the courts for enabling them. A level deeper, we elected them. And even deeper than that, corporate influences and our inability to rein in the military-industrial complex after WWII gave us the elections and propaganda cycle we enjoy today. We built this automaton. It's the Day the Earth Stood Still. Until we shout out "Klaatu Baraata Nikto," our robot will continue to destroy us.

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