US tech companies feel heat of government pressure

US tech companies feel heat of government pressure

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SALT LAKE CITY — The heat is on!

U.S. tech companies are beginning to feel the heat from government pressure to decrypt customer data. The ongoing battle between Apple and the FBI is reportedly starting to affect how companies do business and perhaps may eventually affect where they do it.

A byproduct of the situation is that technology giants like Amazon seem to be changing their policies for encrypting data. As first reported in MotelyFool, Amazon's Fire OS 5 update removed local data encryption. Files were still encrypted from the servers to the cloud, but local files were saved as plain text.

The company's professed reason for doing this was that encryption was a seldom used option, but it didn't sit that way with customers. Once the news broke, Amazon customers let their displeasure be known. Now, Amazon has updated the OS again and returned the local encryption. Through it all, Amazon said this had nothing to do with the FBI situation.

An early casualty of privacy issues was Lavabit. It decided to shut down in August 2013 after getting "'extraordinary' government demands for assistance to access user data, in the wake of the 2013 disclosures by NSA whistleblower Edward Snowden," according to Tech Crunch.

TechCrunch reported Lavabit has now filed an amicus brief in support of Apple's stance in the privacy fight. The company reiterated its earlier warning from three years ago in advising anyone against "trusting their private data to a company with physical ties to the United States."

Lavabit went further to say a demand like this "compromises the proprietary intellectual property of a private company that has not been implicated, in any way, with the crime under investigation." They finished by warning that the "FBI's action against Apple could ultimately trigger an exodus of US companies seeking to avoid similar reputational damage."

While this belief may sound extreme, there's no denying the effect this fight is having on the E.U.-U.S. Privacy Shield. Penny Pritzker, the US Secretary of Commerce, was interviewed by the New York Times about it. She explained that this is a newly negotiated data-transfer agreement that is "strong enough to protect the $260 billion of trans-Atlantic commerce that depends on having the Privacy Shield in place." Stephanie Badoni of Bloomberg reported the Apple case is "threatening" to pierce trust in the efficacy of the Privacy Shield.

Privacy and encryption of data are topics of concern to many U.S. tech companies, prompting Microsoft president Brad Smith to say earlier this month "the path to Hell starts at the back door." In his speech at the annual RSA conference, reported by BizJournals, he went on to say "we need to make sure encryption technology remains strong."

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About the Author: Kent Larson -----------------------------

Kent Larson is originally from Phoenix, Arizona. He loves family, writing, reading, music and movies. He has been teaching English forever and still loves it. Find him on LinkedIn.

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