Wednesday, October 07, 2015

European court's objection to Internet companies' data transfer and holding practices could affect business models

The European Union’s highest court invalidated the “safe harbor agreement” between tech companies, the US and the EU, regarding the way large companies like Facebook and Google store intermediate results of user activity, and sometimes move them around to servers from EU countries to the US.  The court believes this would give the US government and NSA to spy on ordinary citizens in the 28 member countries, some of which have stronger privacy protections than expected in the US.  Some of the sentiment toward this decision does come from the history of Edward Snowden.
Internet companies use various data mobility techniques to make their advertising algorithms more efficient, so that they can make profits from user inquiries and particularly from user generated content. Legal constraints from overseas courts have the potential to affect the business model for social media use everywhere, even in the US.
The news story appeared today in many sources.  In the New York Times, it is by Mark Scott and appears in Business Day, link here.
Update: Oct. 11

The New York Times on Sunday, Oct. 11 reports (in a story by Robert Levine) on the activities o student Max Schrems, in Business Day, here

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