Revelations about the National Security Agency’s (NSA) surveillance efforts are continuing to pose serious business challenges for the tech sector. SIIA is tracking the repercussions closely. Here are a few important developments to note:
Market Backlash: Studies and surveys have suggested a possible backlash against cloud providers and technology companies generally. Here’s a summary of some of them:
- CSA Survey: In July a survey from the Cloud Security Alliance reported that “10% of 207 officials at non-U.S. companies have canceled contracts with U.S. service providers following the revelation of the NSA spy program last month…the survey also found that 56% of non-U.S. respondents are now hesitant to work with any U.S.-based cloud service providers.”
- ITIF Study: By comparing projected growth of US cloud computing sales with a variety of hypothetical sales losses, ITIF suggests that US cloud companies could miss out on as much as $35 billion in additional overseas sales over the next three years.
- Forrester Study: Forrester thinks the potential impact could be as high as $180 billion by 2016, taking into account the reactions of U.S. and non-US companies, the impact on non-US cloud providers and the effects on the rest of the hosting and outsourcing market.
Repercussions for Tech: The NSA revelations continue to have larger repercussions for tech companies in the form of localization requirements and new challenges to the multi-stakeholder form of Internet governance. Here are updates on several of these challenges:
- Brazil’s controversial new internet plans, calling for server and data localization, a local encrypted email service and a separate transatlantic cable connection to Europe that bypasses the US.
- UN General Assembly Address: After canceling a US state visit over NSA spying, Brazil’s Dilma Rousseff issued an announcement called the interception of Brazilian communications “illegal” and said such a “grave fact” was an “assault” on sovereignty and “incompatible with a democratic coexistence between friendly countries.” She then delivered the opening speech at the UN General Assembly today, rejecting U.S. government surveillance programs as inconsistent with human rights and a violation of national sovereignty, and calling for “multilateral mechanisms for the worldwide network that are capable of ensuring principles such as:
- Freedom of expression, privacy of the individual and respect for human rights.
- Open, multilateral and democratic governance, carried out with transparency by stimulating collective creativity and the participation of society, Governments and the private sector
- Universality that ensures the social and human development and the construction of inclusive and non-discriminatory societies
- Cultural diversity, without the imposition of beliefs, customs and values.
- Neutrality of the network, guided only by technical and ethical criteria, rendering it inadmissible to restrict it for political, commercial, religious or any other purposes.
She concludes: “Harnessing the full potential of the Internet requires, therefore, responsible regulation, which ensures at the same time freedom of expression, security and respect for human rights.”
Civil Society Calls for Principles: International civil society groups have issued a call for government surveillance principles consistent with human rights.
EU Response: Viviane Reding’s address in Brussels last week held up the Data Protection regulation as the EU’s response to the fear of US government surveillance, explicitly took privacy issues off the table for discussion in TTIP, and suggested the formation of an EU-area cloud that would compete globally on the basis of better privacy rules and streamlined government regulation.
Mark MacCarthy, Vice President, Public Policy at SIIA, directs SIIA’s public policy initiatives in the areas of intellectual property enforcement, information privacy, cybersecurity, cloud computing and the promotion of educational technology. Follow Mark on Twitter at @Mark_MacCarthy