US To Lose '$35bn A Year' Over NSA Spying
(Sky News (UK) Via Acquire Media NewsEdge)
In a report for the Washington DC-based Information Technology & Innovation Foundation think tank, senior analyst Daniel Castro said America's "entire tech industry" had been implicated - and was now facing a global backlash.
The possible loss, which covers the next three years, is based on the assumption that many companies outside the US will buy services in other countries rather than risk copies of their data being turned over to the US government.
The estimate comes amid claims some US tech firms have given access to spies to scoop up data from servers and cloud computing warehouses.
In June, National Security Agency (NSA) whistleblower Edward Snowden began leaking details of the extent of snooping done by US spies into the lives of ordinary people and companies.
All non-US citizens are considered legitimate surveillance targets of the NSA, which dwarfs the CIA in budget, manpower and signals intelligence (sigint) capabilities.
While the spies say they are thwarting terrorism, Mr Snowden's leaks have shown surveillance is much more widespread than previously realised, raising the ire of both Americans and foreigners.
But Britain may not be a winner in the data storage war, as many may turn towards continental European and Scandinavian alternatives. Irrespective of location, cloud computing is liable to being breached by illicit means.
Codebreakers at Britain's GCHQ - with surveillance treaty links dating back to 1943 with the US military - have also been implicated in widespread telephone, email and internet surveillance.
The Snowden revelations claimed both organisations, aided by their "Five Eyes" second-tier partners in Canada, Australia and New Zealand, have infiltrated numerous financial institutions, governance organisations and companies.
The United Nations, money transfer firms and even online games have reportedly been targets.
The US has led the world in information technology and more than $1.3trn in shareholder wealth is tied up in Apple, Google, Microsoft, Facebook and Yahoo! alone, and the companies collectively employ more than 243,000 people.
On Monday, eight top tech firms in the US sent an open letter to Barack Obama urging reform on American snooping.
The impact on offshore cloud computing could be large. According to the US International Trade Commission, exports of digitally enabled services from the US totalled $356bn (£210bn) in 2011.
Forrester Research analyst James Staten initially estimated the loss at $60bn (£36bn) a year but has since reassessed the loss to other nations as $20bn (£12bn) annually.
US tech firms are also worried about internet users curbing their social media usage and the amount of information they are willing to expose online - which directly impacts their revenue through lower advertising returns.
"We are now entering a new phase of the internet that I call 'data wars'," said internet privacy specialist and SpiderOak chief executive Ethan Oberman.
"It's all about who can amass the most personal data, because that data has become so valuable that whoever accumulates the most is going to win."
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