U.S. tech companies with global ambitions have a problem: their globally ambitious government.
Microsoft (MSFT) is fighting a search warrant that orders it to hand over emails stored on a server in Ireland. Federal agents want the email as evidence in a drug case, but its importance goes far beyond the war on drugs.
If the U.S. government can compel U.S. companies to hand over information held in other countries, then non-American citizens and businesses have yet another reason to avoid our technology industry.
I've explained before (see
NSA Popping the Technology Bubble) how companies like Microsoft are in an impossible position. They have to obey U.S. government demands, but must also convince foreign customers that their data is safe from prying eyes. This latest case is further evidence that balancing those two goals within the same company is impossible.
The result is utterly predictable. Non-American people and businesses will choose non-American companies for their hardware, cloud computing and data storage needs. U.S. technology companies who think they can grow overseas will
have a rude awakening.
The Internet was supposed to break down borders and bring the world together, but Washington is making sure that can't happen. Our "world wide web" is instead going to fragment into a Balkanized collection of national intranets, all suspicious of each other.
In the latest drug case, Microsoft argues the U.S. government has no jurisdiction over the Irish data center. If it wants to search and/or seize that data, it should go through Irish courts to request it.
This seems very reasonable. The U.S. and Ireland have a mutual legal assistance treaty that establishes a process for such requests. That's not good enough for Washington, though. They don't want to follow their own treaties or recognize Ireland's authority over data within Irish borders.
I would find this very offensive if I were an Irish citizen. It would not make me want to "buy American." It would do the opposite by making me more determined to "buy Irish."
Between the War on Drugs and the War on Terror, the U.S. government has effectively declared War on Everyone, Everywhere. We shouldn't be surprised if the other side decides to fight back in whatever ways it can.
Will Microsoft win its case in court? I wouldn't count on it. I'm not even sure they want to win. The search warrant challenge could easily be faux resistance from tech lawyers who
pretend to care about your privacy.
With all we learned from Edward Snowden's documents, it seems likely the National Security Agency already has the email that drug agents want so badly to see. We know that NSA and DEA share data with each other. The court fight could be a Kabuki act that makes us think Microsoft is on our side.
The fact that such suspicions are even mildly plausible is a huge problem for Microsoft. The company might be sincere, or it might not.
We can never be sure either way.