[Infowarrior] - Credibility Crunch for Tech Companies Over Prism

[Richard Forno]

	• TECHNOLOGY
	• Updated June 8, 2013, 1:09 p.m. ET

http://online.wsj.com/article/SB10001424127887324798904578531672407107306.html

Credibility Crunch for Tech Companies Over Prism

By AMIR EFRATI, SHIRA OVIDE and EVELYN M. RUSLI

With Silicon Valley's credibility in protecting consumer privacy on the line, many of the largest Web companies on Friday emphasized they aren't giving the U.S. government a direct pipe into their networks as part of a secret program to monitor foreign nationals.

But the denials of involvement by Google Inc., Microsoft Corp. and others, which come at the same time the Obama administration confirmed the existence of such a program, raised questions about how data is ending up in the hands of the government.

The issues are especially acute for companies who make their business by collecting and processing customers' most personal data and secrets.

Google CEO Larry Page and Chief Legal Officer David Drummond said in a blog post that the company doesn't give U.S. government investigators "open-ended access" to its network and hadn't "joined" a program known as Prism and run by the National Security Agency.

The executives said Google only hands over data based on legally-authorized requests that it reviews individually.

Jerry Seib explains how the far-reaching data collection conducted by the U.S. government includes phone companies in addition to Verizon, plus Internet service providers and Apple. Photo: Getty Images

U.S. officials briefed on the matter said Friday that the NSA receives copies of data through a system they set up with a court order. They don't have direct access to the company computers, those people said.

Companies including Apple Inc., Facebook Inc. and Yahoo Inc. all specified in some way that the government doesn't have "direct access" to their networks. But they didn't say whether the government may be indirectly siphoning user information—including subject lines of emails and photos stored online—through an intermediary in response to secret court orders.

One former government official and cybersecurity legal expert said the companies are likely carefully parsing their words. This person said it is likely that the government is able to get copies of data in real-time or near real-time without accessing the Internet companies' central servers.

The Internet companies didn't answer questions about these potential side doors into their data.

Google and Microsoft release regular reports that outline the number of government requests for user data per year, but such reports don't include the kind of court-ordered requests made by the NSA for its surveillance of foreign nationals. Such requests prohibit the recipients from disclosing them.

U.S. officials also shed little additional light on how the program works on Friday. The National Security Agency referred questions about Prism on Friday to the office of the Director of National Intelligence. Representatives for the office didn't immediately respond to questions.

Federal law-enforcement agencies can issue data-disclosure orders to the tech companies under the FISA Amendments Act, a law that permits the government to obtain surveillance orders from a special court without warrants on specific people.

The orders compel companies to provide data, such as the content of emails, files and photos, stored online.

The technical mechanism through which the tech companies comply with foreign-surveillance orders is unclear.

One industry executive familiar with the handling of data requests from U.S. intelligence agencies said companies have set up ways to cope with the volume of data by automating parts of the process. This method would allow data to be funneled to intelligence agencies without the need for manual steps by company employees.

Agency personnel, this person said, are likely to have the capability to conduct informal searches through company data to help narrow searches associated with particular individuals and aid in crafting formal data requests.

Internet giants have been repeatedly accused of funneling information about their users to the U.S. and other governments.

Two years ago, Julian Assange, the editor in chief of Wikileaks, called Facebook an "appalling" spy machine during a media interview, adding that he believed the social network, Google and Yahoo had "built-in interfaces for U.S intelligence."

In a comment at the time, a Facebook spokesman said, "There has never been a time we have been pressured to turn over data."

Obama administration officials stressed Friday that the NSA surveillance program focuses on foreign nationals, not Americans. But for companies like Facebook—which counts roughly 80% of its monthly users outside the U.S. and Canada—the disclosure of surveillance on foreign nationals raises its own problems.

A backlash, privacy advocates warned, may be particularly strong in Europe, where governments and citizens have been more sensitive to privacy issues.

Following the disclosure, some European lawmakers and regulators seized the opportunity to reiterate their commitment to protect privacy. German Justice Minister Sabine Leutheusser-Schnarrenberger told daily newspaper Die Welt that "German citizens don't want their data to automatically end up with American authorities. It's good and necessary for the U.S. to rethink its antiterror legislation."

In the Middle East, where some governments have recently tried to restrict Internet access and use technology to crackdown on protesters, , the reaction was more muted. "I'm not shocked the U.S. has a very strong spy apparatus. I'm surprised they're careless enough to let it come out," said Wael Eskandar, an Egyptian blogger and activist.

The privacy questions also come at a time when Internet companies are trying to wedge themselves deeper into daily lives around the world. In Silicon Valley, data has become invaluable currency, to serve better ads, prod users to spend more time on services, and create a competitive advantage against rising upstarts.

"Here we are in the world of big data, and we know they can record every single thing," said Michael Pachter, a Wedbush Securities analyst.

—Jessica E. Lessin, Harriet Torry, Matt Bradley, Muhammed Mansour and Siobhan Gorman contributed to this article.

Write to Amir Efrati at amir.efrati at wsj.com, Shira Ovide at shira.ovide at wsj.com and Evelyn M. Rusli at evelyn.rusli at wsj.com

A version of this article appeared June 8, 2013, on page A4 in the U.S. edition of The Wall Street Journal, with the headline: Credibility Crunch for Tech Companies.

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