Under The Cloud Of The NSA Scandal

Derek Mead discovers that the Snowden leaks will cost American tech companies cooperating with NSA between $21.5 billion and $35 billion over the next three years:

The United States, serviced by giants like Google and Amazon, has until now spent more money on cloud computing than the rest of the world combined, but that gap has closed considerably, with Western European markets expected to grow heavily in the next few years. While Europe in particular has been open about trying to spur local cloud efforts, American firms still had a great opportunity to dive into a budding market. But with the US’s great cloud computing secret now out in the open—American servers can be tapped whenever, in secret, with secret court orders—those firms are going to have a much more difficult time competing with upstarts like Iceland, where strict privacy laws have fostered growth in cloud computing and hosting services.

That the US’s intrusions into data would have chilling effects on the data economy is no surprise. “It is often American providers that will miss out, because they are often the leaders in cloud services,” Neelie Kroes, European commissioner for digital affairs, told the Guardian in July. “If European cloud customers cannot trust the United States government, then maybe they won’t trust US cloud providers either.”