PRISM and Internet Balkanization

Yesterday's outing of the U.S. Government's PRISM intrusions into the lives of virtually every Netizen on the planet - with some level of complicity from the likes of Google, Facebook, MS, Yahoo! and others (notwithstanding their remarkably consistent protestations of not having allowed "direct access" to the NSA) - may well herald a fracturing of the Internet.

On the one hand, we are witnessing a digital business opportunity unseen since the blossoming of the commercial Internet.  While Google, Facebook, et al are sure to survive in the homeland - although there's a hue and cry coming once the average American realizes what's been done - what once seemed relatively secure global hegemony is now in peril.

Trust is fragile.

Let's consider Europe, a market in which people take their privacy rather seriously, where the American pre-Internet (and still) experience with direct mail marketing is, in some countries, outright illegal.  Indeed, in Europe, because of such concerns, it is illegal for an EU citizen's personal data to be processed or even hosted on servers outside the EU, unless the company doing the processing is in a country that has data protection laws of as high a standard as the EU.

Even before the PRISM outing, the U.S. was not deemed to conform to these standards, but the PRISM-compromised Internet companies benefited from an EU "Safe Harbor" provision through which they could self-certify their conformity to EU-style standards.

Needless to say, no-one's gonna put much credence in such self-certifications in the wake of yesterday's news.

It is a distinct likelihood that alternative social networking and Google-esque platforms will emerge in Europe - and other markets - where Netizens perceive more meaningful data protection rules and checks on Government intrusion.  This is the commercial opportunity I referenced above.  And the Euro-nationalists will eat it up.

Balkanization? No, but a re-ordering?  Quite likely.

And it gets worse for America - now tossed down from the moral Internet high ground - from a political perspective.

Granted, PRISM doesn't equate to the Internet censorship and related digital and very real-world suppression of free speech in markets like Iran and, to lesser extent, China.  But, no matter what is happening with the data being PRISM'd, just the fact that it is being collected undermines America's credibility in terms of Internet freedom, perhaps empowering some authoritarian regimes to extend their online restrictions and crackdowns, or - worse yet - their own cyber mischief targeted at Americans online.

And, sadly, I think PRISM may just be the tip of the iceberg.  Stay tuned...