Germany Cancels Verizon Contract over Security Concerns

by Matt Klassen on July 3, 2014

While the concern over telecommunications companies operating as fronts for their home nation’s foreign surveillance practices is something we might normally assume relates to Chinese telecom companies working abroad, this time such allegations have hit significantly closer to home, as Germany announced last week that it was cancelling its communication contracts with Verizon over concerns that the provider might be in league with American intelligence agencies.

The announcement follows an investigation into allegations made by American intelligence whistleblower Edward Snowden, who last month claimed that the U.S. had bugged German Chancellor Angela Merkel’s phone, a story that sparked outrage across the country.

While there is no evidence that Verizon was involved in this alleged phone tapping, the news of such allegations were enough to warrant the subsequent backlash against American companies like Verizon operating in the country, now part of the growing tug-of-war over the allegiances of multinational companies operating abroad.

It has been an ongoing security saga plagued with hypocrisy, one started by America authorities citing national security concerns regarding Chinese telecom giants ZTE and Huawei, one that subsequently sparked ongoing tit-for-tat sanctions against private enterprise operating in each respective country and one that ultimately revealed that the NSA had been using those two telecom companies in exactly the same way the American government accused the Chinese government of using them. Confused yet?

But the more that is revealed about America’s shady intelligence practices the more the world is starting to realize that the U.S. is not a victim of such attempted international corporate espionage, but actually the world’s largest perpetrator of it, and that has left many of America’s closest allies concerned that their own national security might be at stake.

It was such revelations about the NSA’s surveillance practices that raised the ire of the Germans last month, as Snowden claimed that the U.S. had tapped the mobile phone of the German chancellor, the highest government office in that country. While the cancellation of Verizon’s communication contracts has not been connected to those allegations, the allegations do serve as the impetus for the change.

As German Interior Ministry spokesman Tobias Plate said: “There are indications that Verizon is legally required to provide certain things to the NSA, and that’s one of the reasons the cooperation with Verizon won’t continue”.

“Furthermore, the ties revealed between foreign intelligence agencies and firms in the wake of the US National Security Agency affair, show that the German government needs a very high level of security for its critical networks,” he said.

With these latest accusations coming from one of America’s closet allies I have to wonder just how far down the rabbit hole goes, and just how progressive revelations will strain not only international relationships, but private American enterprise operating around the world.

However, one thing is for sure, where ethical arguments have failed to initiate changes toAmerica’s surveillance practices there is always one thing that will bring swift and decisive action, and that’s lost revenues. The simple fact is private companies won’t stand for it if they start losing money abroad, and given how effective lobbyists are at dictating American foreign policy, you can bet changes (and profuse apologies) will be quickly forthcoming.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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