Alarm bells have been ringing in the U.S. tech industry since Edward Snowden's leaks of National Security Agency documents first began to surface. With each new revelation, those bells get louder as, increasingly, would-be overseas customers are looking elsewhere. The news that the NSA was working with some U.S. technology companies to create so-called backdoors into security products
heightens their problem.
Just as the Shenzhen, China-based Huawei lost business after the report urged U.S. companies not to use its equipment, the NSA disclosures may reduce U.S. technology sales overseas by as much as $180 billion, or 25 percent of information technology services, by 2016, according to Forrester Research Inc., a research group in Cambridge, Massachusetts.
“The National Security Agency will kill the U.S. technology industry singlehandedly,” Rob Enderle, a technology analyst inSan Jose, California, said in an interview. “These companies may be just dealing with the difficulty in meeting our numbers through the end of the decade.” [...]
Germany’s government has called for home-grown Internet and e-mail companies. Brazil is analyzing whether privacy laws were violated by foreign companies. India may ban e-mail services from Google Inc. and Yahoo Inc., the Wall Street Journal reported. In June, China Daily labeled U.S. companies, including Cisco, a “terrible security threat.”
“One year ago we had the same concern about Huawei,” James Staten, an analyst at Forrester, said in an interview. “Now this is the exact flipping of that circumstance.”
If there's a sliver of good news in any of this, it's that the tech industry does hold some real power with the U.S. Congress and could be a critical ally for privacy and civil liberty advocates. We saw it in the fight against the anti-technology, anti-privacy SOPA/PIPA legislation. It was the engagement of tech companies that really swung the fight for privacy advocates to kill the bad bills.
Now, Google, Facebook and Yahoo are engaged in trying to bring some transparency to the demands that the NSA makes of them. They've petitioned the FISA court for permission to publish at least some information about the requests they’ve received from the NSA. That's because they're customers are demanding transparency. If those demands keep coming, and if potential customers continue to be turned away, the tech industry could start clamoring for Congress and the administration to make real reforms.