NSA scandal proves data is the new oil

12 May 2014

The old adage used to be “when the USA sneezes, the rest of the world catches cold.” When it comes to data privacy and collection of personal information purportedly for national security, America appears to have caught pneumonia and the rest of the world is distancing itself.

The exposure of widespread data collection by Edward J. Snowden did not do the country any favors with its international partners, especially when it was disclosed that ‘friendly’ world leaders were being targeted.

I don’t use the word ‘alleged’ here because even notable publications like the New York Times have stopped using it when mentioning the heinous disservice Snowden did to his country, e.g. “at the NSA, there is grumbling about the continuing disclosures of material stolen by Mr Snowden.”

Observers feel that Americans lost their right to privacy and many hard won civil liberties after 9/11 when the Patriot Act was swept through Congress. There was good reason for it, certainly, but in retrospect it may have opened the Pandora’s Box that President Obama is now trying to squeeze the lid on.

The means of doing this, it seems, is to divert attention from the nation’s security organizations, and whatever they may have been up to, and turn the public’s attention to the data collecting activities of some of the country’s largest digital enterprises.

There is suspicion, particularly in Silicon Valley, that a report issued by presidential adviser, John D. Podesta, is an effort to shift attention from government surveillance by expanding the discussion about how information is used by companies as well.

As the New York Timesreports, “the question is whether restrictions placed on the NSA — and public resistance — will spill over to regulation of the private sector, and conversely whether new norms of what companies can collect will begin to affect the intelligence world.”

We are already aware that governments, and not just in the US, subpoena access to private data held by communications service providers and occasionally by social networks for law enforcement purposes, but their efforts to improve their customers’ experience using big data is now being brought into question.

This rich storehouse of personal information must be very appealing to security organizations that have to make requests each time they need access to it. It should be no surprise the spotlight is being moved in their direction by the Obama government, but they appear to be fighting back.

The Washington Postrecently reported that “major US technology companies have largely ended the practice of quietly complying with investigators’ demands for e-mail records and other online data, saying that users have a right to know in advance when their information is targeted for government seizure.”

In other words, if you insist on asking for information belonging to our customers that has been entrusted to us, then we reserve the right to tell them you have asked for it. The law enforcers are crying foul because they claim this would jeopardize their investigations by tipping off those under investigation and helping them ‘escape’.

For the service providers being asked to hand over the information there is no guarantee that they cannot be sued by the customers for handing it over. They appear to be exposed whichever way they turn, let alone the for the cost and inconvenience factor of many thousands of requests they are asked to fulfil each month.

The Washington Post also reported that, “Apple, Microsoft, Facebook and Google all are updating their policies to expand routine notification of users about government data seizures, unless specifically gagged by a judge or other legal authority, officials at all four companies said. Yahoo announced similar changes in July.”

What is scary is that we may see a trade-off in future where governments may hold back legislation on data collection by enterprises as long as they allow access to it by government agencies, presumably with legislative protection of those enterprises from irate customers.

Far-fetched? Maybe, but stranger things have happened. Whichever way you look at it, data is fast gaining in value as a commodity (‘the new oil’), and anyone that has it will be in a very strong position. However, like any valuable commodity it will come under close scrutiny as a source of revenue and, subsequently, heavy regulation by governments. Watch this space!

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