Do the NSA Revelations Impact Businesses? (Hint: Yes.)

You shouldn’t worry about your government spying on you if you have nothing to hide.

That’s what people would say to me when the NSA leaks started happening, when I first started talking about the dangers that these revelations pose to businesses, both small and large. That’s like saying that if you aren’t a criminal, you shouldn’t mind being treated like a criminal.

Imagine if a tuna fisherman caught millions of dolphins in his net for each tuna that he brought back, he would never have the chance to leave port again. So how can anyone justify the government spying on billions of people around the world just to try to catch a few bad eggs?

The news has been filled with reports and talking heads arguing over whether the NSA spying is no big deal, just more of the status quo, or actually a very dangerous, very slippery slope that we’ve now been made aware of. In the wake of learning of their complete lack of privacy, the world’s reaction ranges from apathy to absolute outrage.

It seems like a lot of Americans are apathetic to the idea, whereas a lot of the rest of the world is absolutely furious. The impacts are larger than just the lack of personal privacy because these revelations have huge impacts on businesses, not just in the US but around the world too.

Bad for Business

Here are some of the reasons that finding out the American government is spying on just about all commutations is bad news for all sorts of businesses, all around the world.

For starters, when the US government is collecting your data in their data centers, you then have to rely on their security to keep it safe. It’s now less of a secret than ever that governments spy on each other, that they hack each other’s computers, and now you’re relying on the US government to keep your business’ data protected from wandering eyes.

This data of yours could contain simple things like passwords to your website or proprietary cupcake recipes, or it could contain billions of dollars’ worth of research and trade secrets that are now on a serving plate ready for international competitors to pillage through. Some businesses go to great lengths to keep their networks secure and to keep competitors from gaining an edge, but once that data is hijacked by the government it’s out of the business’ hands.

Do you trust the US government to keep your data safe?

They couldn’t even keep your data safe from a “high-school-dropout”, as certain media outlets love to refer to Mr. Snowden. How good of a job are they going to do of keeping trade secrets and sensitive data safe? What about 5 years from now? 10 years?

In recent years, American tech companies have been leading the world. Companies like Apple, Google and Microsoft are at the forefront of the tech industry, but the NSA revelations threaten to set them back, just like the manufacturing industry decades before. In the second half of 2013, faith in US tech companies has been shattered.

They’ve all been caught up in lies, at first claiming ignorance of any US government spying, only to come out later and say they were under gag orders, but as the leaks keep coming they’re forced to eat their words time and time again. People don’t trust what they say. This may not impact the average Android user or owner of a Windows laptop, or scare them away from the platform, but when you have entire nations criticizing the US tech industry and looking for ways to cut America out of the digital picture, it’s obvious how this starts to be a real problem.

Play by the Laws of the Land

Something that many people don’t realize is that when you’re storing your data online, it is not the laws of your home country or where you live that apply, but rather the laws of where your data is located. For business-people who travel often, keeping their data in the cloud was supposed to be a huge breakthrough because there was always a risk when carrying all of your important data on a hard drive and traveling to certain countries that you might lose it.

You risked having it searched, unrightfully seized, and having to deal with corrupt local governments.

By keeping your data in the cloud, this was supposed to be a way around all of that but the truth is that your cloud data plays by the laws of the country in which the servers are located, not where your business is located. Companies in other countries are taking advantage of the fact that people don’t trust US datacenters to store their information anymore.

MacquarieTelecom which provides Internet services to the Australian government is capitalizing on the fact that people are afraid to store their data in the US which this video illustrates (at least to me):

Video: Legal Implications of Non-Local Data Centres

Many other companies are following suit, and there’s an ever-growing demand for cloud storage and other business services with no ties to America.

So, This Is Pretty Bad for Business, Then?

No kidding. The repercussions of the NSA leaks are bad for businesses in the US because it fosters a growing sense of distrust, and trust is very important. It’s also bad for businesses around the world that have been relying on US infrastructure and US companies to keep their data safe.

The impact, as if often does, will trickle down to smaller companies as well. What’s the point in spending a lot of money to secure my own data and to keep it safe, when it’s all going to be saved on a government data-center somewhere, that I have no control over?

The media has been trying to paint Edward Snowden in a negative light by saying how unqualified he was, but doesn’t that say even more about the people he was working for? Why would someone who is so unqualified have so much access to sensitive data and information?

Goran Tepshic is a father, husband, and all-round computer geek who had the privilege to watch technology rising from its bare beginnings and powering life as we know it today. He has worked as software architect and developer for some of the biggest brands and is a human rights activist, digital freedoms advocate, and a green tea connoisseur. Read other articles by Goran.