Tech analyst: NSA 'will kill the U.S. technology industry singlehandedly'

[Katashi_itto]

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.


http://www.dailykos.com/story/2013/09/11/1238125/-Tech-analyst-NSA-will-kill-the-U-S-technology-industry-singlehandedly

[1awake]

1. K&R n/t

[jsr]

2. Who will verify these reforms? The tech industry which has been in bed with the NSA?

[avaistheone1]

8. It has appears that most of the tech industry has been under the gun of the government to cooperate.

It seems to me that the govt has made serious threats to that industry.

http://www.democraticunderground.com/1014592686

[Dash87]

3. Some elements of the NSA would love that.

There's certain elements that want to build their very own banana republic isolated castle of a country here in the US populated by scared, obedient lemmings. Anything close to expressing an unapproved opinion would cause one to 'disappear' for the good of the country. They also, paradoxically, want endless war against others.

These fascists shouldn't be allowed anywhere near government positions. They're psychopaths disguised as patriots.

[Katashi_itto]

4. This is the just the first inklings of the blowback thats to come...

[L0oniX]

9. I eagerly hope so. n/t

[jeff47]

5. There's a wee problem with this analysis

and that is the assumption that no other country does the same thing.

Which is very false.

[Katashi_itto]

6. Although your right, thats not the issue here.

It's the US that got caught with it's hand in the cookie jar.

The NSA Leaks Are Starting To Hit The Bottom Lines Of Tech Companies
Revelations about vast US data collection programs are starting to hit American tech companies, which are ramping up pressure for increased transparency to try to mitigate the damage.

An industry group, the Cloud Security Alliance said last month that 10 percent of its non-US members have cancelled a contract with a US-based cloud provider, and 56 percent said they were less likely to use an American company.

A separate report this month by the Information Technology & Innovation Foundation, or ITIF, a Washington think tank, said US cloud providers stand to lose $22 billion to $35 billion over the next three years due to revelations about the so-called PRISM program....

http://www.democraticunderground.com/10023653199

[jeff47]

7. And when they discover their "new" country does the same?

That's the flaw in the analysis - that those big numbers over the next three years require that people remain morons about just how much spying is going on.

[Katashi_itto]

11. It will become like NAFTA, companies perpetually looking for data havens. Either way it won't come

come back to the US. It will be a loss to US companies.

[jeff47]

12. The entire point is there are no data havens.

There are places that claim they will not go digging through your servers. But unless you transmit your data by physically traveling to the servers, you will be monitored by some government.

[Katashi_itto]

13. Yep there are no Data Havens but that won't stop the flight from US companies.

Doesn't mean that companies won't stop looking and buying into the idea there is such a thing. It's the perception thats everything. US companies are pretty much screwed.

[nebenaube]

26. I keep thinking about the Keynesian aspect of all this.

The spying is the only thing keeping these entities afloat. Which basically means it's over, the economy is gone.

[Katashi_itto]

32. Agree, the economic ripples will become a tsunami

[liberal_at_heart]

10. This could be quite a battle for power. Both giants have enormous power and influence.

Let the roosters peck each other's eyes out.

[Uncle Joe]

14. Kicked and recommended.

Thanks for the thread, Katashi_itto.

[Katashi_itto]

18. Thank you!

[1-Old-Man]

15. Sheeeeat. One thing I know, the minute privacy becomes profitable it will flourish

[Katashi_itto]

16. Exactly! Thats what will drive the flight from US companies to anywhere that

promises the potential of that. The US companies have blown it for themselves.

"It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently." - Warren Buffett

[1-Old-Man]

19. Well said.

[Katashi_itto]

20. Thanks

[WillyT]

17. K & R !!!

[KurtNYC]

21. Broader than that -- the fundamental currency of business is trust.

If buyer and seller do not have some level of mutual trust then they will not trade. Warranties, testimonials, refunds, brand reputation all create trust. Casinos and Wall Street need the trust of their customers as much as any other business.

A general sense that 'the game is rigged' doesn't help anyone.

[Eleanors38]

22. Rumor: U.S. Energy companies moving data from here to

more secure servers/clouds in Switzerland.

[Katashi_itto]

23. Not really a rumor: Gov Spying Boosts Swiss Data Center Revenues

Companies concerned about keeping their data safe from prying governments are turning to Swiss data centers that have the security of national laws which protect information from the other countries’ spy agencies.

Mateo Meier, director at Artmotion, Switzerland’s biggest offshore hosting company, said revenues grew 45 to 50 percent last year as companies from industries as varied as oil and gas to technology to finance look for a place to store confidential data.



http://www.forbes.com/fdc/welcome_mjx.shtml

[Eleanors38]

34. Those were the figures I heard. Thanx for the source.

[Katashi_itto]

35. Oh no problem, I didnt find anything about Energy, but I would say it's quite reasonable

to assume thats happening

[Egalitarian Thug]

24. K&R If only someone could've predicted this, years ago.

Oh wait...

[Katashi_itto]

25. Hehe

[BelgianMadCow]

27. Key point. I'm surprised there hasn't been more of an outcry

on the part of the business community, especially outside of the US. But I see people talking about alternatives everywhere.

And it was reported that both in France and Germany govt employess are told to shun US products.

I know I will, as soon as I can do more that what I do today.

[Katashi_itto]

28. Good lord the eventual blowback is going to devestating.

[nadinbrzezinski]

30. Open source software is pretty good and stable

[BelgianMadCow]

33. Here's some excellent Open Source software that I use:

It never ceases to amaze me how few people know Open Office, the Office interface we all came to know & like and able to read and write all Office formats. I recommended it to people at the time when M$ came with the docx format, and all older version users were suckered. http://www.openoffice.org/http://www.openoffice.org/
]

And there are also:
- Linux as an excellent free operating system, comes in various flavors and is especially good in staying compatible with lower end hardware. Check out the various possibilities at Distrowatch.
- Firefox for your browser (+ NoScript and AdBlockPlus addons)
- VLC media player
- the GIMP for photoshopping

Yes, Open Source is the way of the future.

[nadinbrzezinski]

29. Yup, some of us wrote about that early in the scandal

the other thing it will likely do is fragment the net.

[gulliver]

31. The NSA probably works with foreign tech companies for back doors too.

Why do we think the NSA would only ask American companies? And why would any business not assume that back doors were possible and take trustworthy measures to safeguard their data?

All Snowden did was raise a stink about practices everyone probably already knew were occurring and of negligible concern. Our economic competitors are more than happy to play up concerns. It is the oldest trick in the book. The Snowden/Greenwald publicity releases hurt perceptions of our country and IT industry. They cost us economically and returned no benefit whatsoever.