Schumpeter | Online surveillance

The empires strike back

America’s tech giants have a chance to show off their lobbying magic

By M.G. | SAN FRANCISCO

AFTER being swept up in the furore over government spying on their customers, some of America’s biggest tech companies are finally mounting a rearguard action. On December 9th a group of eight prominent firms including Google, Facebook, Apple and Microsoft launched an initiative to urge an international ban on the bulk collection of data by governments, claiming that the balance of power in many countries has tipped too far in favour of the state and away from the individual.

Since revelations surfaced about the extent of the spying activities being undertaken by intelligence agencies on both sides of the Atlantic, tech giants in Silicon Valley and elsewhere have found themselves in an awkward position. On the one hand, the technologies and services that they have developed have made it possible for governments to scoop up vast amounts of data and parse them in various ways that help intelligence-gathering. On the other, the companies have tried to present themselves as champions of their customers’ privacy, pushing back against spooks that want to get their hands on customers’ data.

Given that several of the outfits associated with the new initiative, dubbed the “Reform Government Surveillance coalition”, have had run-ins with regulators over their own handling of sensitive customer data, this zeal to protect consumers’ privacy is more than a little ironic. But it is also a sign of just how worried America Tech Inc. has become: stories about data-sharing between tech firms and America’s National Security Agency and about taps designed to hoover up information passing between data centres could have a big impact on their collective bottom line.

Already some countries such as Brazil are writing rules that would require firms handling their citizens’ data to abide by much stricter regulations. The European Union is also tussling with America over regulations of how data may be collected and used by companies. Should these and other such initiatives create a world in which it is much harder and more expensive for companies to gather data, this would be a big blow to the likes of Facebook and Google. They have prospered in large part because of their ability to target ads to people.

Interestingly, the group does not include telecoms firms such as AT&T or Verizon, both of which have also come under public scrutiny since the debate about data surveillance by American government agencies has taken off. Perhaps because of their huge market clout in America they do not have to be as worried about mass desertions as web firms.

The internet companies involved in the new coalition want to see governments’ ability to gather customer information limited and more oversight of spooks’ demands for data. And they want to be able to publish the number of requests they receive from the American government for data under the terms of both the Patriot Act and the Foreign Intelligence Surveillance Act. In the recent past, tech firms have had a big influence on policies governing everything from content piracy to e-commerce. Now they have another chance to show off their lobbying magic.

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