NSA spying might have affected U.S. tech giants more than we thought


Spying by the National Security Agency and increasing demands by the feds for client data continues costing U.S. IT giants billions in lost revenue while also damaging reputations of the American company’s themselves.

That’s the assertion by Electronic Frontier Foundation legislative analyst Mark Jaycox. Based on NSA documents leaked by fugitive Edward Snowden, successful agency programs, like surreptitiously inserting backdoor trojans into U.S. manufactured hardware destined for foreign customers, likely continue despite the firestorm the disclosures created.

“The NSA is like any other bureaucracy. Government programs that work continue. Ones that don’t are stopped. And then they try new ones,” Jaycox said.

Jaycox pointed out that the fallout has instilled a climate of suspicion that has affected myriad U.S. tech and telecommunication firms. Jaycox said his research derived from available NSA-related documents and U.S. corporate quarterly earnings, like Cisco’s, where executives have elucidated on the damage done to business by the revelations.

“NSA spying has impacted cloud-based company’s, telecos, software, everything across the board for U.S. firms,” Jaycox said.

In fact, after Cisco learned some of their products were being back-doored with NSA trojan malware, the company blasted the agency and the U.S. government for adversely affecting their bottom line. Indeed, a Cisco spokesperson emailed this response to VentureBeat late Wednesday.

Cisco was actually one of the companies to acknowledge potential impacts on our business, discussing geopolitical factors in China during our November 2013 earnings call. While security has always been a high priority for our customers, we find it more significant today than ever before. These are conversations we want to have with our customers, and we welcome the opportunity to share our holistic approach to product security and how each customer can best protect and secure their network and data.”

Jaycox recently returned to the Bay Area after co-chairing a talk at the Black Hat security conference in Las Vegas last week about the NSA’s global metadata collection programs, including penetrating the likes of Apple, Facebook, Google, Twitter, and many others.

A former NSA official agreed, and said many customers of U.S. hardware..

Read more: http://venturebeat.com/2014/08/13/nsa-spying-tech-companies/