Back in June, news leaked of the National Security Agency’s (NSA) PRISM surveillance project in the US, and it caused quite a stir at the time! Since then, US cloud providers have been involved with lengthy discussions regarding the predicted financial impact to themselves, particularly following confirmation from cloud giants, including Google and Microsoft, that they had received user information requests from the NSA.
Add the recent report by the Information Technology and Innovation Foundation (ITIF) who predict that cloud computing in the US may lose around $22 billion to $35 billion by 2016 (total revenue) due to the latest PRISM leaks, plus a further 10-20% revenue from the overseas cloud marketplace, you can forgive cloud providers for being a little bit on edge! ITIF’s report claims that their estimate is based on Cloud Security Alliance’s recent survey which demonstrated that 10% of overseas customers had, following the PRISM revelations, cancelled their products with cloud computing providers based in the US.
As if this isn’t bad enough, there are some who believe that the final damage to the technology industry in the US could be even worse than ITIF predict. Rob Enderle, President and Principal Analyst at the Enderle Group, says that the PRISM leaks, in addition to the damage on sales of cloud services, would also seriously affect the sales of IT networking equipment to offshore companies. “China was moving to ban Cisco, for instance,” he said. “The more visible PRISM becomes, the less likely offshore buyers will be willing to buy any US-sourced computer technology. Because firms don’t understand the breadth of PRISM, they are apparently starting to paint US gear with a broad negative brush,” he added.
If this trend goes on, the size of the loss of sales in the US national and international technology market is going to be severely affected. But cloud providers are looking on the bright side; well, they’ve got to really. They state that as long as the right levels of security and privacy are included, then there shouldn’t be a problem. PerspecSys, cloud providers in the US, said: “With the proper security solutions in place, enterprises can confidently adopt cloud services based anywhere in the world, while keeping their data resident and within their full control, thereby eliminating concerns about third parties accessing their sensitive corporate function.”
The debate rumbles on… but what is abundantly clear is that either the cloud vendors or the US government has to stand up and be counted, i.e. take action! The ITIF has even gone as far to say that the US government’s role is clear when it comes to the cloud industry; that if it continues to interfere with US cloud providers, other countries will capitalise at the expense of US businesses.
It is a stumbling block for the government; surely they want to see more growth in a steadily increasing marketplace, which can only be good for the country’s economy? So, why aren’t they being proactive in this discussion and helping to find a solution? If you have the answers, or any suggestions, let us know… maybe we can help to solve the problem.