NSA screws the pooch for US tech and cloud companies


Snowden’s NSA revelations have caused 10% of foreign companies to cancel contracts with US cloud companies. And that’s just the leading edge of the justifiable outrage. Well done, NSA. I’m sure that Amazon, Facebook, Microsoft, and the rest who cheerfully gave NSA carte blanche to their data will now pretend to be horrified too and make faux gestures towards not being NSA lapdogs. But their ploy will fail. They’ve poisoned their own well. Well done, Silicon Valley.

In a survey conducted after the Snowden leaks, 10% of the foreign companies using cloud computing services said they’d already cancelled a project with a US cloud provider and 56% said they’d be less likely to use US-based providers. Conversely, among US stakeholders in the cloud sector, 36% said that the NSA leaks would make it more difficult doing business outside the US. The report estimated that if US cloud companies lose between 10% and 20% of their foreign business over three years, it will cost them between $21.5 billion to $35 billion.

But the report cautions it could get much more expensive “if foreign governments enact protectionist trade barriers that effectively cut out US providers.” In Europe, momentum in that direction is growing.