The NSA harms US tech sector overseas

Stefan Hammond/Computerworld Hong Kong
31 Jul 2013

The revelations of Edward Snowden have severely damaged the reputation of US technology firms. And now we can start counting the cost in terms of lost euros.

The “Safe Harbor Framework” between the US and Europe is intended to promote export US technological services, in fact, it has its own US government website. But now, EU Justice Commissioner Viviane Reding has launched a review of the deal. There are also calls for German Chancellor Angela Merkel to push for its suspension, due to NSA surveillance fears.

The Safe Harbor Framework, launched in October 1998, has always been at odds with the US Patriot Act, a piece of post-9/11 legislation that EU countries dislike—to the detriment of US business abroad. Now that it's clear that the NSA isn't concerned with EU standards of data privacy, Europeans are alarmed.

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How alarmed? According to Computerworld journalist Jaikumar Vijayan: “Non-US clients of American cloud hosting companies are clearly rattled by revelations that the [NSA] collects huge amounts of customer data from Internet Service Providers and telecommunication companies.”

A Cloud Security Alliance (CSA) survey found that 10% of 207 officials at non-US companies have canceled contracts with US service providers following the revelation of the NSA spy program last month. The alliance, a non-profit organization with over 48,000 individual members, said the survey also found that 56% of non-US respondents are now hesitant to work with any US-based cloud service providers.

The online survey, seeking to gauge the potential impact of Snowden's disclosures on US-based hosting companies, was conducted between June 25 and July 9.

"The level of skepticism was greater than I expected," said Jim Reavis, co-founder and executive director of the CSA.

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