Snowden film ‘CitizenFour’ wins top documentary award

LOS ANGELES | “CitizenFour,” filmmaker Laura Poitras’s documentary about National Security Agency whistleblower Edward Snowden, was given the top award for best feature by the International Documentary Association on Friday.

The IDA award for “CitizenFour” follows the film’s best documentary win at the New York Film Critics Circle Awards this week. It was also nominated for an Independent Spirit Award last month and is among 15 films advancing in the Oscars best documentary race.

“CitizenFour” gives a fly-on-the-wall account of Snowden’s tense days in a Hong Kong hotel and encounters with journalists as newspapers published details of NSA programs that gathered data from the Internet activities and phone records of millions of Americans and dozens of world leaders.

U.S. filmmaker Poitras shared a Pulitzer Prize this year for her role in publicizing the Snowden documents. She was awarded IDA’s Courage Under Fire award last year for her “conspicuous bravery in the pursuit of truth.”

The IDA, a 30-year-old non-profit organization that aims to support documentary films and culture, also bestowed honors on veteran actor-filmmaker and Sundance Institute founder Robert Redford, who was given the career achievement award.

Cable network Show time’s “Time of Death” was named best limited series, while best short documentary went to HBO Films’ “Tashi and the Monk,” about a Buddhist monk and his 5-year-old charge Tashi.

Last year’s IDA best feature winner, Jehane Noujaim’s “The Square,” was nominated for an Oscar this year, losing out to “20 Feet From Stardom.”

source: interaksyon.com

Cyberspying tool could have US, British origins

WASHINGTON — A sophisticated cybersespionage tool has been stealing information from governments and businesses since 2008, researchers said Monday, and one report linked it to US and British intelligence.

The security firm Symantec identified the malware, known as Regin, and said it was used “in systematic spying campaigns against a range of international targets,” including governments, businesses, researchers and private individuals.

The news website The Intercept reported later Monday that the malware appeared to be linked to US and British intelligence, and that it was used in attacks on EU government networks and Belgium’s telecom network.

The report, citing industry sources and a technical analysis of the malware, said Regin appears to be referenced in documents leaked by former National Security Agency contractor Edward Snowden about broad surveillance programs.

Asked about the report, an NSA spokeswoman said: “We are not going to comment on speculation.”

Symantec’s report said the malware shares some characteristics with the Stuxnet worm– a tool believed to have been used by the US and Israeli governments to attack computer networks involved in Iran’s nuclear program.

Because of its complexity, the Symantec researchers said in a blog post that the malware “would have required a significant investment of time and resources, indicating that a nation state is responsible.”

The researchers added that “it is likely that its development took months, if not years, to complete and its authors have gone to great lengths to cover its tracks.”

Lurking in shadows

“Regin’s developers put considerable effort into making it highly inconspicuous,” Symantec said.

“Its low key nature means it can potentially be used in espionage campaigns lasting several years. Even when its presence is detected, it is very difficult to ascertain what it is doing. Symantec was only able to analyze the payloads after it decrypted sample files.”

The researchers also said many components of Regin are still probably undiscovered and that there could be new versions of this tool which have not yet been detected.

The infections occurred between 2008 and 2011, after which the malware disappeared before a new version surfaced in 2013.

The largest number of infections discovered — 28 percent — was in Russia, and Saudi Arabia was second with 24 percent. Other countries where the malware was found included Mexico, Ireland, India, Afghanistan, Iran, Belgium, Austria and Pakistan. There were no reported infections in the United States.

Around half of all infections occurred at addresses belonging to Internet service providers, but Symantec said it believes the targets of these infections were customers of these companies rather than the companies themselves.

Telecom companies were also infected, apparently to gain access to calls being routed through their infrastructure, the report noted.

Regin appeared to allow the attackers to capture screenshots, take control of the mouse’s point-and-click functions, steal passwords, monitor traffic and recover deleted files.

Symantec said some targets may have been tricked into visiting spoofed versions of well-known websites to allow the malware to be installed, and in one case it originated from Yahoo Instant Messenger.

Other security experts agreed this was a dangerous tool likely sponsored by a government.

“Regin is a cyberattack platform, which the attackers deploy in victim networks for total remote control at all levels,” said a research report from Kaspersky Lab.

Kaspersky added that Regin also appears to have infiltrated mobile communications through GSM networks, exposing “ancient” communication protocols used by cellphone networks.

Antti Tikkanen at Finland-based F-Secure called it “one of the more complex pieces of malware around,” and added that “our belief is that this malware, for a change, isn’t coming from Russia or China.”

The news comes amid heightened concerns on cyberespionage.

Last month, separate teams of security researchers said the Russian and Chinese governments are likely behind widespread cyberespionage that has hit targets in the US and elsewhere.

source: interaksyon.com

White House unveils plan to end NSA's bulk collection of phone data

WASHINGTON - The Obama administration on Thursday announced details of its plan to end the government's vast bulk collection of data about phone calls made in the United States, including new procedures to get judicial approval before asking companies for such records.

Under the plan, phone companies would have to provide data from their records quickly and in a usable format when requested by the government, a senior administration official told reporters on condition of anonymity.

It would also allow the government to seek the data without a court order in a national security emergency.

"I am confident that this approach can provide our intelligence and law enforcement professionals the information they need to keep us safe while addressing the legitimate privacy concerns that have been raised," President Barack Obama said in a statement about the plan, which needs approval by Congress.

The US government began collecting so-called metadata shortly after the September 11, 2001, attacks on the United States, under part of the Patriot Act known as Section 215.

The program's defenders say it helps the government find connections between people plotting attacks overseas and co-conspirators inside the United States, while critics view it as an infringement of privacy rights.

Obama has been under pressure to rein in surveillance since former National Security Agency contractor Edward Snowden last year disclosed classified details about the breadth of the government's intelligence gathering, sparking an international uproar.

Next step: Congress

Obama announced his initial response to the debate in January, including a ban on eavesdropping on the leaders of allied nations.

On Thursday, the administration provided additional details about its plans for telephone records known as metadata. Such records document which telephone number called which other number, when the calls were made and how long they lasted. Metadata does not include the content of the calls.

Under the proposal, once the Foreign Intelligence Surveillance Court approves gathering records associated with a phone number, phone companies could be required to turn over data associated with that number on an "ongoing and prospective" basis, a senior administration official said on a conference call.

Companies would be compelled to provide technical assistance to the government to query the records, and may be compensated in a way that is consistent with current procedures, the official said.

The administration will ask the court to allow it to operate its existing program for at least another 90 days, as Congress weighs legislation.

"We would hope that the Congress would take something up very expeditiously," the official said.

At least two proposals for ending bulk collection of phone data have already been unveiled by lawmakers.

In October, Patrick Leahy, the Democratic chairman of the Senate Judiciary Committee, and Jim Sensenbrenner, a House Republican, introduced a bill that would require the government to show a request for data was relevant to an ongoing investigation.

Their bill, called the USA Freedom Act, has been endorsed by privacy advocates including the American Civil Liberties Union.

Earlier this week, Republican Mike Rogers and Democrat Dutch Ruppersberger, the top lawmakers on the House of Representatives' intelligence panel, released a plan that would not require the government to first get court approval of a request for data.

Instead, the court could order the data expunged if it was later found not to be linked to suspicious activity.

House Speaker John Boehner, a Republican, has said he supports the bill.

But Obama has been clear that "one of the main attributes" he wanted to see in the overhaul was requiring court approval before data requests are made, the senior administration official said, noting the government has been following that practice since January. (Additional reporting by Mark Felsenthal)

source: interaksyon.com

Google enhances encryption for Gmail

BEIJING — Google enhanced encryption for its Gmail service, according to its today’s announcement, so that customers’ data and private information will be protected from interception of the US National Security Agency (NSA).

The protection extension will ensure that Gmail users be exempt from being snooped as the data travels from their machines to Google’s data centers.

This move is out of the concern that people may reduce their online activities after the spy scandal of American government was exposed last year.

Last year, leaked documents by former NSA contractor Edward Snowden disclosed that NSA had secretly tapped into links connecting data centers of Yahoo and Google, which outraged these technology companies.

source: interaksyon.com

Google co-founder Larry Page says US online spying threatens democracy

VANCOUVER, March 20, 2014 (AFP) – Google co-founder Larry Page on Wednesday condemned US government snooping on the Internet as a threat to democracy.

His comments came during an on-stage chat at a prestigious Technology Entertainment Design gathering, where a day earlier fellow Google founder Sergey Brin had a virtual encounter with National Security Agency leaker Edward Snowden.

A photo of Brin smiling with a robot remotely controlled by Snowden from a refuge in Russia, where the wanted man is in hiding, was tweeted by TED curator Chris Anderson and became an instant online hit.


“It is tremendously disappointing that the government sort of secretly did all this stuff and didn’t tell us,” Page said.

He reasoned that details of suspected terrorist threats should remain cloaked but that the parameters of what US intelligence agents do, along with how and why they do it, should be public.

“We need to have a debate about that or we can’t have a functioning democracy; it is just not possible,” Page said.

“It is sad that Google is in the position of protecting you and our users from the government doing secret things nobody knows about; it doesn’t make any sense.”

Spying backlash peril

As smartphones and sensors synched to the Internet obtain and share increasing amounts of data about where people are and what they are doing, Page said it was critical for people to be given choices of how it is used.

He was concerned, though, that privacy fears and a backlash to online spying would result in blocking uses of personal information for beneficial purposes.

He noted how shared medical information, on an aggregate scale and made anonymous, could help researchers develop treatments and patients select doctors or map medical care.

“We are not really thinking about the tremendous good that can come from people sharing the right information with the right people in the right ways,” Page said.

Page gave the example of going public with details of trouble with his voice.

“On your show, I kind of lost my voice and I haven’t gotten it back,” Page joked with Rose.

“I am hoping that by talking to you I am going to get it back. Get out your Voodoo doll and do whatever you need to do.”

Web bill of rights

Earlier in the day, on the same TED stage, the father of the World Wide Web urged those in the conference’s influential and innovative community to fight to keep life on the Internet free and open.

Tim Berners-Lee rallied support for creating a bill of rights for the Internet this year in the wake of revelations about extensive government surveillance.

Berners-Lee launched his Web We Want campaign last week as the Web turned 25 years old.

He has repeatedly called for fewer controls on the Web, and has praised Snowden for revealing details of how the US government collects masses of online data.

Berners-Lee conceived the Web 25 years ago in his spare time at Geneva-based CERN, Europe’s top particle physics lab.

“I want to use this anniversary to think about what kind of Web we want,” Berners-Lee said, referring ideas to a Webat25.org website.

NSA to respond

Former intelligence contractor Snowden emerged from his Russian exile Tuesday in the form of a remotely-controlled robot to promise more sensational revelations about US spying programs.

The fugitive’s face appeared on a screen as he maneuvered a wheeled android around the TED gathering, addressing an audience in Vancouver without ever leaving his hideaway.

“There are absolutely more revelations to come,” he said. “Some of the most important reporting to be done is yet to come.”

Snowden used the conference to launch a global call to fight for privacy and Internet freedom.

He endorsed Berners-Lee’s quest for a global Magna Carta laying out values and rights on the Internet.

Berners-Lee briefly joined Snowden’s interview with TED curator Chris Anderson, and put the leaker in the hero camp.

National Security Agency Deputy Director Rick Ledgett will appear at the TED gathering early Thursday via video link as a counterpoint to Snowden’s talk, according to Anderson.

source: interaksyon.com

New York Times urges clemency for Snowden

WASHINGTON -- The influential New York Times hailed fugitive intelligence leaker Edward Snowden as a "whistleblower" on Thursday and threw its weight behind calls for him to be shown clemency.

The editorial was quickly seized upon by activists campaigning to persuade President Barack Obama's administration to drop its bid to prosecute the former National Security Agency contractor.

And it touched a nerve with Times readers.

More than 1,200 left comments on the daily's website within hours of the item going online, and it soared to the top of its "most viewed" items of the day.

The Times, one of several newspapers around the world to report on US surveillance tactics based on secret files leaked by Snowden, has previously voiced support for the 30-year-old.

But editorial page editor Andrew Rosenthal said the explicit call for the administration to cut a deal with Snowden had come about just as US public and expert opinion begins to swing behind him.

"It felt like there was a real critical mass," Rosenthal told the Times' public editor Margaret Sullivan, one of many journalists who wrote follow-up columns on the mounting furor.

The Times' case, mirrored in a similar op-ed in campaigning British daily The Guardian, was that Snowden had done the United States a service by exposing the vast scope of secret digital surveillance.

Reports based on Snowden's leaked files have revealed a global dragnet run by Washington and its allies in the English-speaking world, scooping up Internet traffic and telephone call logs.

This outraged many, including some US telecoms users and foreign governments targeted in the indiscriminate sweeps, and it has touched off a political and legal debate in the United States.

While Snowden remains in Moscow, protected by temporary political asylum, US courts have begun examining the legality of the snooping and the White House has carried out an internal review.

One federal judge has already dubbed NSA snooping "almost Orwellian" and probably illegal, and Obama has promised that his review will lead to some new limits on spy agency activity.

Legally speaking, however, Snowden still faces arrest and prosecution, and could see decades in jail for treason or espionage.

The Times opposes this, arguing that he launched a national debate.

"He may have committed a crime to do so, but he has done his country a great service," the paper wrote.

The Times urged the administration to allow Snowden to return home and "face at least substantially reduced punishment."

The National Security Council declined to comment, referring AFP to previous White House statements.

Obama has said he welcomes debate about the NSA's role, but has refused to discuss the possibility of amnesty or a presidential pardon for Snowden.

In mid-December, the White House renewed its demand for the fugitive leaker to return to face trial.

US federal prosecutors have filed a criminal complaint against Snowden, charging him with espionage and theft of government property. Some lawmakers have dubbed him a traitor.

Major rights watchdogs supported the Times' call.

Human Rights Watch's executive director Kenneth Roth tweeted: "Snowden exposed major misconduct. Others filing official complaints were ignored/persecuted. He should be pardoned."

The American Civil Liberties Union said it "couldn't agree more" with the editorial.

The editorial also echoed remarks made by Rick Ledgett, an NSA official who led a task force investigating damage from the leaks.

Last month, Ledgett became the first serving national security official to suggest publicly that Snowden could cut a deal to avoid prosecution if he stops exposing US secrets.

It is not clear how many more documents taken by Snowden have still to be revealed. Journalist Glenn Greenwald, who has worked closely with him, says there are thousands more pages to come.

Some have said a plea deal for Snowden like the one suggested by the Times could allow US investigators to at least discover the size of the breach and identify compromised programs.

source: interaksyon.com

Big US tech firms calls for reform on snooping

WASHINGTON — Six of the biggest US technology firms are urging the U.S. Congress to rein in the National Security Agency by requiring more transparency about surveillance and improved privacy protections.

In a letter to a Senate committee, the tech giants applauded the introduction of the USA Freedom Act aimed at ending bulk collection of phone records and improve privacy protection in the Foreign Intelligence Surveillance Court.

“Recent disclosures regarding surveillance activity raise important concerns both in the United States and abroad,” said the letter signed by Google, Apple, Microsoft, Facebook, Yahoo and AOL.

The companies, which have failed to win efforts to disclose details of their cooperation with US surveillance programs, said more transparency would “help to counter erroneous reports that we permit intelligence agencies ‘direct access’ to our companies’ servers or that we are participants in a bulk Internet records collection program.”

“Transparency is a critical first step to an informed public debate, but it is clear that more needs to be done. Our companies believe that government surveillance practices should also be reformed to include substantial enhancements to privacy protections and appropriate oversight and accountability mechanisms for those programs.”

The letter dated Thursday and addressed to the Senate Judiciary Committee came days after a news report said the NSA has tapped into key communications links from Yahoo and Google data centers around the world.

The Washington Post, citing documents obtained from former NSA contractor Edward Snowden and interviews with officials, said the program can collect data at will from hundreds of millions of user accounts, including from Americans.

The report said the program dubbed MUSCULAR, operated jointly with NSA’s British counterpart GCHQ, indicated that the agencies can intercept data flows from the fiber-optic cables used by the US Internet giants.

The NSA disputes key details of the report.

The bill proposed by Senator Patrick Leahy and Representatives James Sensenbrenner and John Conyers, with other co-sponsors.

Leahy and Sensenbrenner said in a joint statement they welcomed the wide support for their bill.

“The breadth of support for our bipartisan, bicameral legislation demonstrates that protecting Americans’ privacy not only cuts across the party divide, but also addresses concerns raised by the technology industry and other advocates,” Leahy and Sensenbrenner said.

“The time is now for serious and meaningful reform. We are committed to working with lawmakers on both sides of the aisle to get this done so we can restore confidence in our intelligence community and protect the privacy rights of our citizens.”

The Center for Democracy and Technology, a digital rights advocacy group, meanwhile urged other companies to speak up.

“This is a defining moment and other companies must now step up to support genuine FISA reform or explain to their users why they are not,” said Leslie Harris, president and chief executive of CDT.

source: interaksyon.com

NSA intercepts Google, Yahoo traffic overseas - Washington Post report

SAN FRANCISCO -- The National Security Agency has tapped directly into communications links used by Google and Yahoo to move huge amounts of email and other user information among overseas data centers, the Washington Post reported on Wednesday.

The report, based on secret NSA documents leaked by former contractor Edward Snowden, appears to show the agency has used weak restrictions on its overseas activities to exploit major US companies' data to a far greater extent than realized.

Previously reported programs included those that allowed easy searches of Google's, Yahoo's and other Internet giants' material based on court orders.

But since the interception in the newly disclosed effort, code named MUSCULAR, occurs outside the United States, there is no oversight by the secret intelligence court.

The Post said the operation gained access to a cable or switch that relayed the traffic through an unnamed telecommunications provider.

"We are outraged at the lengths to which the government seems to have gone to intercept data from our private fiber networks, and it underscores the need for urgent reform," said Google chief legal officer David Drummond.

Google said it had not been aware of the program, although it recently began speeding its efforts to encrypt internal traffic.

Like other companies, Google and Yahoo constantly send data over leased and shared or exclusive international fiber-optic telecommunication lines as they synchronize information.

The newly disclosed program, operated jointly with the United Kingdom's Government Communications Headquarters, or GCHQ, amassed 181 million records in one recent 30-day span, according to one document reported by the Post. It could not be learned how much of that included material from US residents, how the agency redacted data on them or how much of the information was retained.

'Valid foreign targets only’

An NSA spokesperson said in a statement the suggestion in the Post article that the agency relies on a presidential order on foreign intelligence gathering to skirt domestic restrictions imposed by the Foreign Intelligence Surveillance Act and other laws "is not true."

"The assertion that we collect vast quantities of US persons' data from this type of collection is also not true," the statement said. "NSA is a foreign intelligence agency. And we're focused on discovering and developing intelligence about valid foreign intelligence targets only."

Asked at an event in Washington about the latest report, NSA Director General Keith Alexander said that he had not read it but that the agency did not have unfettered access to the US companies' servers.

"I can tell you factually we do not have access to Google servers, Yahoo servers," Alexander said at a Bloomberg Government conference. "We go through a court order."

He did not directly address whether the agency intercepts such traffic in transit. The NSA is known to tap undersea cables.

A Yahoo spokeswoman said, "We have strict controls in place to protect the security of our data centers, and we have not given access to our data centers to the NSA or to any other government agency."

Yahoo in January will begin encrypting users' email as it moves to the company, but it declined to say whether it would go further and keep email encrypted as it moves within Yahoo.

The report is likely to add to growing tensions between the US intelligence establishment and the tech companies, which have been struggling to assure customers overseas that they need not fear US spying.

Senate Judiciary Committee Chairman Patrick Leahy said he would ask for an administration briefing on the program because millions of US residents could have had their communications monitored daily.

"I will be asking whether this report is accurate, what legal authority the government is using, and how they are protecting the privacy rights of law-abiding Americans," the Vermont Democrat said.

source: interaksyon.com

US lawmakers move to rein in NSA snooping

WASHINGTON -- Democratic and Republican US senators introduced legislation on Wednesday to end the National Security Agency's bulk collection of Americans' communication records and set other new controls on the government's electronic eavesdropping programs.

The measure introduced by Democrats Ron Wyden, Mark Udall and Richard Blumenthal, and Republican Rand Paul, is one of several efforts making their way through Congress to rein in sweeping surveillance programs.

The Senate Intelligence Committee is holding a public hearing on Thursday when the panel's leaders are expected to discuss their surveillance reforms, the Senate Judiciary Committee is addressing the issue and several members of the House of Representatives have also introduced legislation.

"The disclosures over the last 100 days have caused a sea change in the way the public views the surveillance system," said Wyden, a leading congressional advocate for tighter privacy controls, told a news conference.

The surveillance programs have come under intense scrutiny since disclosures this spring by former National Security Agency contractor Edward Snowden that the government collects far more Internet and telephone data than previously known.

The legislation introduced on Wednesday combines several surveillance reforms that legislators had introduced separately.

Besides banning the bulk collection of Americans' records, it would create the position of "constitutional advocate" to represent the public in the secret Foreign Intelligence Surveillance Court that oversees the eavesdropping programs.

And it would let Americans affected by the eavesdropping sue for damages in US courts and allow companies to disclose more information about cooperation with government surveillance.

"These reforms are the right thing to do, but they are also essential to the public believing that the system is complying with the law," Blumenthal said.

Many members of Congress staunchly defend the surveillance programs as an essential defense against terrorist attacks, but support for change has been growing.

In a 217-205 vote in July, the House narrowly defeated an amendment to an appropriations bill that would have sharply limited the NSA's ability to collect electronic information.

The strong support for the amendment -- bolstered by an unlikely alliance of liberal Democrats and libertarian Republicans -- surprised many congressional observers because House leaders and members of the Intelligence Committee had strongly opposed it.

Given the level of dissent - and widespread public concern - lawmakers said they expected some reforms would be included in the National Defense Authorization Act, which Congress is due to pass late this year to authorize Defense Department programs.

source: interaksyon.com

Despite fears, NSA revelations helping US tech industry

SAN FRANCISCO — Edward Snowden’s unprecedented exposure of U.S. technology companies’ close collaboration with national intelligence agencies, widely expected to damage the industry’s financial performance abroad, may actually end up helping.

Despite emphatic predictions of waning business prospects, some of the big Internet companies that the former National Security Agency contractor showed to be closely involved in gathering data on people overseas — such as Google Inc. and Facebook Inc. – say privately that they have felt little if any impact on their businesses.

Insiders at companies that offer remote computing services known as cloud computing, including Amazon and Microsoft Corp, also say they are seeing no fallout.

Meanwhile, smaller U.S. companies offering encryption and related security services are seeing a jump in business overseas, along with an uptick in sales domestically as individuals and companies work harder to protect secrets.

“Our value proposition had been that it’s a wild world out there, while doing business internationally you need to protect yourself,” said Jon Callas, co-founder of phone and text encryption provider Silent Circle, where revenue quadrupled from May to June on a small base.

“Now the message people are getting from the newspapers every day is that it’s a wild world even domestically.”

Prophesies of doom

Shortly after Snowden’s leaked documents detailed collaboration giving the NSA access to the accounts of tens of thousands of net companies’ users, the big Internet companies and their allies issued dire warnings, predicting that American businesses would lose tens of billions of dollars in revenue abroad as distrustful customers seek out local alternatives.

In a federal court filing last week, Google said that still-unfolding news coverage was causing “substantial harm to Google’s reputation and business”. The company said that could be mitigated if it were allowed to comment with precision about its intelligence dealings.

Likewise, last month, six technology trade groups wrote to the White House to urge reforms in the spy programs, citing what it called a “study” predicting a $35 billion cumulative shortfall by 2016 in the vital economic sector.

That number, it turns out, was extrapolated from a security trade group’s survey of 207 non-U.S. members – and the group, the Cloud Security Alliance, had explicitly cautioned that its members weren’t representative of the entire industry.

“I know you want sectors and numbers, but I don’t have it,” said Ed Black, president of the Computer & Communications Industry Association, one of the trade groups behind the letter. “Anybody who tells you they do is making it up.”

The trade groups aren’t the only ones issuing dismal, and headline-grabbing, forecasts.

Forrester Research analyst James Staten wrote of the $35 billion figure: “We think this estimate is too low and could be as high as $180 billion, or a 25 percent hit to overall IT service provider revenues.”

Staten’s comments generated dozens of media stories, some of which neglected to mention that Staten said the worst would come to pass only if businesses decided that spying was a bigger issue than the savings they gained from a shift to cloud computing.

In an interview with Reuters, Staten said he didn’t believe that would be the case. “I don’t think there’s going to be a significant pullback,” he said, though the rate of growth could slow for a couple of years.

Little impact

Google employees told Reuters that the company has seen no significant impact on its business, and a person briefed on Microsoft’s business in Europe likewise said that company has had no issues. At Amazon, which was not named in Snowden’s documents but is seen as a likely victim because it is a top provider of cloud computing services, a spokeswoman said global demand “has never been greater.”

In the more than three months since Snowden’s revelations began, no publicly traded U.S. company has cited him in a securities filing, where they are required to report events that are material to their business.

One reason that the prophecies of business doom are getting such a wide airing is that both the U.S. industry and its overseas detractors have been saying the same thing – that customers will stop buying from U.S. cloud companies.

Politicians in Europe and Brazil have cited the Snowden documents in pushing for new privacy laws and standards for cloud contracts and in urging local companies to steer clear of U.S. vendors.

“If European cloud customers cannot trust the U.S. government, then maybe they won’t trust U.S. cloud providers either,” European Commission Vice President Neelie Kroes told The Guardian. “If I am right, there are multibillion-euro consequences for American companies.”

There have indeed been some contract cancellations.

Charles Mount, chief executive of business file-sharing service OneHub, told Reuters that an automated system that asks customers why they have dropped the OneHub service elicited this reply from an unspecified Bertelsmann unit in Austria:

“Headquarters is banning storage of company data in the U.S. or with U.S. companies altogether because of the NSA data-mining and industrial espionage. You should watch out for that. Maybe you should think about hosting in Iceland, Sweden or some other place known for complying with their own privacy legislation.”

Bertelsmann spokesman Christian Steinhof said the company couldn’t confirm that the exchange had occurred and therefore wouldn’t comment.

Few good alternatives

There are multiple theories for why the business impact of the Snowden leaks has been so minimal.

One is that cloud customers have few good alternatives, since U.S. companies have most of the market and switching costs money.

Perhaps more convincing, Amazon, Microsoft and some others offer data centers in Europe with encryption that prevents significant hurdles to snooping by anyone including the service providers themselves and the U.S. agencies. Encryption, however, comes with drawbacks, making using the cloud more cumbersome.

On Thursday, Brazil’s president called for laws that would require local data centers for the likes of Google and Facebook. But former senior Google engineer Bill Coughran, now a partner at Sequoia Capital, said that even in the worst-case scenario, those companies would simply spend extra to manage more Balkanized systems.

Another possibility is that tech-buying companies elsewhere believe that their own governments have scanning procedures that are every bit as invasive as the American programs.

Some think it’s just a matter of time, however, before U.S. industry suffers significantly.

“Industry is still in denial,” said Caspar Bowden, once the chief privacy officer at Microsoft and now an independent researcher and privacy advocate in Europe. “It’s like Wile E. Coyote running over the cliff, his legs are still turning but he hasn’t started falling yet.”

Boon for encryption sector

As for the upside, so far only a minority of people and businesses are tackling encryption on their own or moving to privacy-protecting Web browsers, but encryption is expected to get easier with more new entrants. Snowden himself said that strong encryption, applied correctly, was still reliable, even though the NSA has cracked or circumvented most of the ordinary, built-in security around Web email and financial transactions.

James Denaro, a patent attorney with security training in Washington, was already using Pretty Good Privacy (PGP), a complicated system for encrypting email, before the Snowden leaks. Afterward, he adopted phone and text encryption as well to protect client information.

“One of the results we see from Snowden is an increased awareness across the board about the incredible cyber insecurity,” Denaro said.

Some early adopters of encryption have senior jobs inside companies, and they could bring their habits to the office and eventually change the technology habits of the whole workplace, in the same way that executive fondness for iPhones and iPads prompted more companies to allow them access to corporate networks.

“Clients are now inquiring how they can protect their data overseas, what kinds of access the states might have and what controls or constraints they could put in with residency or encryption,” said Gartner researcher Lawrence Pingree, formerly chief security architect at PeopleSoft, later bought by Oracle.

Richard Stiennon, a security industry analyst and author, predicted that security spending will rise sharply.

A week ago, Google said it had intensified encryption of internal data flows after learning about NSA practices from Snowden’s files, and consultants are urging other big businesses to do the same.

Stiennon said that after more companies encrypt, the NSA and other agencies will spend more to break through, accelerating a lucrative cycle.

“They will start focusing on the encrypted data, because that’s where all the good stuff is,” Stiennon said.

Already, in a fiscal 2013 federal budget request from the intelligence community published this month by the Washington Post, officials wrote that investing in “groundbreaking cryptanalytic capabilities” was a top priority.

source: interaksyon.com