How the NSA Is Harming America's Economy

anagama writes "According to an article at Medium, 'Cisco has seen a huge drop-off in demand for its hardware in emerging markets, which the company blames on fears about the NSA using American hardware to spy on the rest of the world. ... Cisco saw orders in Brazil drop 25% and Russia drop 30%. ... Analysts had expected Cisco's business in emerging markets to increase 6%, but instead it dropped 12%, sending shares of Cisco plunging 10% in after-hours trading.' This is in addition to the harm caused to remote services that may cost $35 billion over the next three years. Then, of course, there are the ways the NSA has made ID theft easier. ID theft cost Americans $1.52 billion in 2011, to say nothing of the time wasted in solving ID theft issues — some of that figure is certainly attributable to holes the NSA helped build. The NSA, its policies, and the politicians who support the same are directly responsible for massive losses of money and jobs."

Comments

tough love

[TheGratefulNet]

#include "grumpycat"
printf("good!\n");

seriously, I would not trust US hardware and software, either.

but then again, those routers are already at every choke-point on the internet. the US owns the internet (public one, anyway) in all practical ways.

but for private networks when you can pick which routers and switches you want to deploy, picking a US based vendor would not be wise. I would not do it if I was in charge of a private network.

maybe its time we consider going back to software (oss) based networking gear. it will be much slower than hardware based ones but we can't verify hardware designs like we can software ones.

there is also no way to put this genie back into the bottle. once your cred is gone, its gone. and the US has lost ALL cred when it comes to safeguarding your privacy.

sad but true. as a US citizen, I am sorry for how badly we have botched the world's trust.

Re:You mean Massive Increase in jobs and spending

[larry bagina]

Look beyond hardware -- think data centers, cloud services, etc. Europeans are dropping American-based offerings for European-based ones or moving it back inhouse.

If its made in the USA - I don't trust it

[openthomas]

These leaks have cost America the trust of an entire generation. In the last few months I deleted my gmail, linkedin, facebook, twitter, ebay and amazon accounts, and when my cellphone dies I won't buy another. If US companies deny their customers the basic human right that is dignity through privacy then it will be to their extreme financial loss. Personally I want no part of what these services have to offer because they do not respect me as a individual. I don't trust the hardware, the software, the services, the network, the companies or the government. And google can stick glass up their ass.

It will take time, not happen all at once

[Anonymous Brave Guy]

Microsoft, Google, Amazon and Apple all go bankrupt at once because of this.

That is extremely unlikely. What is more plausible, however, is:

1. They continue to lose the confidence of international customers.

2. Those customers seek alternative arrangements that they consider more trustworthy, possibly ad-hoc ones at first.

3. Over time, a new generation of more structured alternatives begins to develop to supply the new market demand, offering similar services and products to the big name US brands.

Some of these may be direct commercial competitors, but that's not really the concern for the current market leaders, because the barrier to entry for anyone trying to compete head-on is huge. Probably the greater risk is collaborative movements, whether Open Source tools or simply a degree of standardisation and compatibility between smaller vendors that means you can build (for example) a heterogenous network using a pool of specialist vendors and have a good chance of it working.

This is potentially toxic to broad US vendors such as Cisco in the networking space or the big cloud services companies who ideally want you to outsource almost your entire IT infrastructure to them alone. Which brings us on to...

4. Even in the US, long-time and lucrative customers start second-guessing whether they still need US IT Brand X, and those brands start losing serious money to both the foreign movements and, over time, also to new competitors in the US who are riding the open/collaboration wave to get a disruptive foothold in the market.

And at that point, the big US vendors are really in trouble.