Edward Snowden’s revelations on the NSA’s spying activities of U.S. tech companies' customers is beginning to hit them – hard, according to the New York Times.
“It’s clear to every single tech company that this is affecting their bottom line,” Daniel Castro, a senior analyst at the Information Technology and Innovation Center, told the Times.
Castro predicts that the United States’ cloud computing industry could lose $35 billion by 2016, and tech research firm Forrester said the losses could be as high as $180 billion, or 25 percent of industry revenue.
Already tech companies are shifting their spending to accommodate international clients who might be concerned about their privacy. IBM said it would build 15 new data centers internationally to get companies who are sensitive about their data to use their services. The cost? $1.2 billion. Salesforce.com has similar plans.
Tech execs at many Silicon Valley companies have said they were unaware of the extent that the government was tapping into their user data when the PRISM scandal first broke. Facebook's Mark Zuckerberg, Google's Larry Page and others have insisted they were only complicit in the government’s requests when it was required of them by a court order.
Still, many people and companies continue to be suspicious of tech companies’ role in the controversy, and this week the NSA's general counsel said the companies knew the agency was collecting the data.
As a result, tech industry leaders say they’re not even being considered in some contracts and losing business.
Read more: Snowden's NSA leaks begin to impact IBM, Salesforce, Google, other tech companies - SiliconValley Business Journal
“It’s clear to every single tech company that this is affecting their bottom line,” Daniel Castro, a senior analyst at the Information Technology and Innovation Center, told the Times.
Castro predicts that the United States’ cloud computing industry could lose $35 billion by 2016, and tech research firm Forrester said the losses could be as high as $180 billion, or 25 percent of industry revenue.
Already tech companies are shifting their spending to accommodate international clients who might be concerned about their privacy. IBM said it would build 15 new data centers internationally to get companies who are sensitive about their data to use their services. The cost? $1.2 billion. Salesforce.com has similar plans.
Tech execs at many Silicon Valley companies have said they were unaware of the extent that the government was tapping into their user data when the PRISM scandal first broke. Facebook's Mark Zuckerberg, Google's Larry Page and others have insisted they were only complicit in the government’s requests when it was required of them by a court order.
Still, many people and companies continue to be suspicious of tech companies’ role in the controversy, and this week the NSA's general counsel said the companies knew the agency was collecting the data.
As a result, tech industry leaders say they’re not even being considered in some contracts and losing business.
Read more: Snowden's NSA leaks begin to impact IBM, Salesforce, Google, other tech companies - SiliconValley Business Journal
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