Germany Drops Verizon After NSA Spying Furore

The German government has cancelled a contract with the US telecoms giant Verizon Communications, owing to concerns about the spying activities of the National Security Agency (NSA), as revealed by the whistleblower Edward Snowden.

Last June, Verizon famously became the first in a long line of companies to be outed as supplying customer data and records to the NSA. Other revelations were to follow, including allegations that the NSA had wiretapped the mobile phone belonging to the German Chancellor Angela Merkel. In response, the German government has opted to cancel a contract for its internal communications that was held with the German subsidiary of Verizon. It is expected that Germany’s own Deutsche Telekom will get the business.

Contract Cancellation

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According to Reuters, the German government was prompted to launch an overhaul of its internal communications and secure government networks, after talks of a “no-spy” deal between Washington and Berlin collapsed after the US appeared unwilling to give the assurances Germany wanted.

“The pressures on networks as well as the risks from highly developed viruses or Trojans are rising,” Germany’s Interior Ministry was quoted as saying in a statement. “Furthermore, the ties revealed between foreign intelligence agencies and firms in the wake of the US National Security Agency (NSA) affair show that the German government needs a very high level of security for its critical networks.”

Verizon had reportedly been supplying network infrastructure for the German government’s network between Berlin and Bonn, used for communications between the various governmental ministries. The contract had been in place since 2010 and was set to expire to 2015, but now has been cancelled early.

It is expected that Verizon will be replaced by Deutsche Telekom, which according to Reuters is already responsible for the most sensitive communications between government departments and the German intelligence agencies.

Financial Repercussions

In America, the chief executives of the largest tech players have been warning for a while now about the financial repercussions on their businesses caused by the NSA revelations.

In May Cisco chief executive John Chambers wrote to US President Barack Obama warning that the surveillance activities of the US government was undermining the confidence of export customers in the security of US-made technology.

Previously, Chambers blamed financial setbacks experienced at his company on the fact that developing markets had been ‘spooked’ by the political repercussions of the NSA spying allegations.

But the tech industry in general within the United States has been angered and frustrated by the demands of the NSA. Last month, many big players including Google, Facebook, Microsoft, AOL, Apple, Twitter, LinkedIn, DropBox, and Yahoo withdrew their support of a US government bill designed to reform the mass-surveillance activities of the NSA, because it had been watered down by US politicians.

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