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Will NSA spying hurt the U.S. tech industry? (Video and Podcast)

NSA-spyingThe U.S. tech industry, represented by the likes of Facebook, Google, and the other titans of Silicon Valley, has been a bright spot in the American economy. But could revelations of mass surveillance by the U.S. National Security Agency (NSA) boomerang on American economic interests?

NSA blowback is not just a strong possibility, it’s already happening, according to Chester Wisniewski, senior security adviser at Sophos. In multiple media interviews this week, Chet explained that businesses are deeply worried about the NSA’s data collection programs.

“The biggest concern that the people I talk to have is around the economic impact of foreign companies being willing to trust their American counterparts to buy services,” Chet says in an interview with Bloomberg TV.

Despite new proposals unveiled this week by U.S. President Barack Obama to rein in the NSA’s bulk data collection, companies in countries such as Brazil and Germany might not be willing to invest in American companies, Chet says.

That could be extremely hurtful to smaller businesses that don’t have the enormous influence and market presence of the big companies like Google or IBM.

Speaking to Ben Johnson from the Marketplace Tech podcast, Chet says that small tech start-ups that are the lifeblood of the industry could face the biggest impact.

“What really concerns me the most is, what happens to tech start-ups who can’t afford to build a data center in 18 countries to comply with privacy laws,” Chet says. “Big companies will find a way to get through the storm, whereas little companies might get wiped out.”

For both U.S. and foreign businesses, as well as individuals concerned about their data privacy, the best defense against NSA intrusions is strong encryption, Chet says.

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