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As a top U.S. telecommunications and hardware player, Qualcomm's silence is somewhat disturbing

At the close of Qualcomm Inc.'s (QCOM) Monday 2014 Computer Electronics Show (CES 2014) keynote I asked Qualcomm's new CEO Steve Mollenkopf a question that's of keen interest to foreign customers -- how can Qualcomm's technology be trusted in light of recent revelations of companies appearing to assist the U.S. National Security Agency (NSA) to spy not only on Americans, but on business leaders in ally states such as Brazil, Japan, South Korea, France, and Germany?

The CEO gave me a pretty boilerplate nonanswer.  He stated:

I think if you look at Qualcomm's technology you will see that we're among the leaders in the industry in security.  But as for what the government is doing we can not comment on that.

A Qualcomm representative took my card and promised to email me a followup comment.

Qualcomm Mollenkopf
Qualcomm CEO Steve Mollenkopf at his company's CES 2014 keynote

I understand the hesitancy of tech leaders to go on the record and comment on NSA spying.  While there are some notable exceptions of course, such as Oracle Corp. (ORCL) CEO Larry Ellison who happily opines his support for domestic spying and Google Inc. (GOOG) Chairman Eric Schmidt who calls spying "not ok", most leaders are likely fearful of reprecussions in terms of government contracts and taxation, should they voice negative thoughts on the U.S. government's spy programs.

On the other hand it's too important and financially costly an issue to suffer in silence.  The NSA spying is expected to cost the IT space $21.5-35B USD (according to the Information Technology and Innovation Foundation (ITIF)) over the next three years, due to damaged trust in the international community.

We've already seen one such high profile loss -- Brazil's national government shot down a bid by The Boeing Comp.'s (BA) for a $4.5B USD jet fighter contract.  The F/A-18 Super Hornet was formerly the front runner for the contract according to Reuters.  Now the update to Brazil's jet fleet will go to Swedish jetmaker Saab AB (STO:SAAB-B) who will provide the South American nation 36 new Gripen NG fighters by 2020.

As embarassing leaks continue to accelerate we may be looking at an even more massive loss of business for the U.S. electronics industry than previously expected in terms of foreign sales.  The U.S. leads the world in electronics, but there all alternatives.  The market will likely choose to take those alternatives -- at least in terms of corporate IT and government contracts -- if U.S. tech is suspected of containing back doors for NSA malware.

Qualcomm SnapdragonAs a top provider of processors for mobile devices and basestation technology, Qualcomm needs to clarify its thoughts on NSA spying and how it plans to protect its customers.

For that reason I feel it is a vitally important for any U.S. company involved in telecommunications -- be it on the hardware or software side (both of which Qualcomm is involved in) -- to provide a clear and considered response to such questions.  If they do not, any lost business will be on their backs as much as on the policies Americans and Congress unwittingly allowed to fester and grow, fertilized by national security fears.

Sometimes it makes sense to have such a response come from a legal team that can offer up a clear statement of the company's perspective on the issue, while avoiding unnecessarily inflammatory language.

In that regard, I hope to hear a more in-depth response from Qualcomm's PR/legal team shortly.

[Qualcomm's keynote was at noon at the Mandalay Bay Convention Center in Las Vegas, Nevada.]

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By Rukkian on 1/7/2014 10:40:05 AM , Rating: 4
He was directly responding to somebody that blamed it all on Obama. While Obama has ramped it up, all of this has been going on for quite some time.

I really don't think that any politician will stop this until the country finally wakes up and puts their foot down, unfortunately, most of the country are idiots who just parrot the Fox news reports that Obama is the devil, or other outlets showing that everything is the Republican's fault.

I think both are corrupt, and we would need to get rid of both parties and start over, or at least get rid of all incumbents.

I say we all just start voting for challengers (don't worry about the party) until things start to change. Eventually if enough people loose their jobs (the power is what they really care about), they might start listening.

By Monkey's Uncle on 1/7/2014 12:26:35 PM , Rating: 2
Anybody want to place bets that the next yahoo that gets into the white house is not going hose everyone with reach even worse than Obama is doing?


By superstition on 1/8/2014 10:53:14 AM , Rating: 2
"I'd be pissed too, but you didn't have to go all Minority Report on his ass!" -- Jon Stewart on police raiding Gizmodo editor Jason Chen's home

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