Cloud Market: the Impact of Edward Snowden's Revelations
Bekijk de Nederlandse versie Voir la version française
The massive NSA surveillance operation revealed last year is likely to have a significant impact on the US-based cloud computing industry. More transparency is now essential in order for these companies to win back consumer confidence. To this end, Microsoft has announced its intention to begin hosting data outside of the US.
For anyone with concerns about online security and privacy, 2013 was the Year of Snowden: from June onwards there came a flow of revelations about the dragnet surveillance of phone lines, the Internet, text messages, and other digital communications by the US National Security Agency (NSA).
On the 6th of June, the existence of the monitoring program PRISM was revealed: the NSA and the FBI had used ‘backdoors’ to access the servers of nine leading IT companies, including Microsoft, Google, and Apple.
Worried Governments Around the World
These revelations triggered the concern of political and economic leaders all over the world, especially as it had become clear that the US intelligence service had also been monitoring the communications and documents of foreign firms and governments.
In July, the German Minister of the Interior suggested that anyone concerned about their privacy should simply avoid online services with servers located in the United States, including those from Google and Microsoft.
Since then, US services have lost millions of contracts and users, as in India, where half a million civil servants were ordered not to use messaging services hosted in the United States, such as Gmail, and to turn instead to the email services of the Indian National Informatics Centre.
Up to $35 billion at Stake for US Giants
The stakes are high: according to the Information Technology and Innovation Foundation, US-based cloud computing providers stand to lose $22 to $35 billion in just three years, due to the repatriation of non-US data by foreign customers.
Faced with such a threat to their business, the US IT giants asked the courts for the right to disclose more precisely which of their users’ activities are monitored by the NSA, and which are not. In an unprecedented move, traditional competitors such as Google and Microsoft have joined forces to fight against the secrecy imposed on them.
On the 27th of January, the US government announced that it would allow companies to give some figures (aggregate, but not detailed) on the specific activities of its intelligence agencies. Although this is undoubtedly a step in the right direction, it leaves open the question of espionage carried out without the prior knowledge and participation of these companies.
A Fast-Growing Market
Reassuring customers of the privacy of their data remains a key objective: on the 22nd of January, Microsoft announced that it would now offer its foreign customers data hosting outside of the U.S.
Cloud computing specialists operate in a fast-growing market, which explains the sensitivity of the issue of safety: a study from Forrester on IT infrastructure professionals
in European companies with more than 1,000 employees indicates that the adoption of private cloud services (with an infrastructure dedicated to a single organization) has jumped from 25 to 42% between 2012 to 2013.