Another Reason to Hate NSA Spying: It Hurts the Economy

SILICON

February 27, 2015—The NSA revelations managed to hurt public trust in government—for a good reason. But the NSA’s widespread spying program didn’t do any favors to the U.S. economy either. At least that’s what a recent Reuters report claims.

The government of China, the report says, has discontinued its use of U.S.-based technology for state purchases. Since leaks have revealed that foreign governments are often targeted by the NSA, the Chinese government has decided to avoid potential risks. Fears related to backdrops implanted by the NSA have also been mentioned in the reports.

Brands including Apple, McAfee, Intel, and Cisco were hurt as a result.

Chinese companies, on the other hand, are excited about the developments. According to Reuters, the Chinese government prefers to use domestic brands since they offer more “product guarantees.” Many experts read that as a direct attack against the lack of privacy security American companies are capable of guaranteeing due to the NSA’s surveillance programs.

Contrary to what many are saying, however, the leaks aren’t responsible for the economic losses; the government’s mass surveillance program is. And while some believe the impact may reach the multi-billion dollar mark, that’s not the first time the NSA has hurt U.S. businesses.

In January, Microsoft reported sales loss linked to the Chinese market. While the company did not elaborate on the reasons behind the drop, many believe the Chinese market just doesn’t trust the company is able to guarantee security from mass surveillance. HP has also reported sales issues abroad.

For Costco, however, the sales drop was the most significant yet to date. According to the report, the company saw a 19 percent drop in revenue during 2015’s first quarter.

Technological giants in the U.S. rely on Chinese businesses and government for some of its revenue. But some believe Silicon Valley industries won’t see the real impact of government intrusion until sometime in the near future. A 2013 prediction regarding the NSA program and how the Snowden leaks were going to impact business estimated that, by 2016, the U.S. tech industry was going to lose $180 billion due to mistrust.

Do you think FCC regulations will worsen the tech industry problems? Share your thoughts below.

Sources:
ZDNet
Forbes

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