Perhaps you noticed former Microsoft Chief Software Architect Ray Ozzie address the issue in a weekend post on Hacker News, where he wrote:

“[I]n this world where “SaaS” and “software eats everything” and “cloud computing” and “big data” are inevitable and already pervasive, it pains me to see how 3rd Party Doctrine may now already be being leveraged to effectively gut the intent of U.S. citizens’ Fourth Amendment rights. Don’t we need a common-sense refresh to the wording of our laws and potentially our constitution as it pertains to how we now rely upon 3rd parties? It makes zero sense in a “services age” where granting third parties limited rights to our private information is so basic and fundamental to how we think, work, conduct and enjoy life.”

Ozzie might be truly concerned about citizen privacy, but as the founder of a new cloud-based mobile communications service, he’s probably also concerned about attracting users. He’s not alone. His former employer and other large companies  — including some named as part of the NSA’s secretive PRISM program — have been pushing for privacy reform for years as a means to cement the viability of the cloud.

Maybe now they’ll finally get their way.

Money talks (and privacy nods its head)

The argument — as I’ve highlighted before — might not be so much about privacy as it is about profit: Companies like Microsoft, Google, Apple and all the startups that Congress seems to love so much rely on people trusting the cloud in order to make money. If the PATRIOT Act, the Electronic Communications Privacy Act or any other legislation scare users away, that money goes with it.

Thus far, most of the activity has centered around the antiquated Electronic Communications Privacy Act (ECPA), a piece of legislation written in 1986 that makes it relatively easy for government agencies to obtain people’s email and other electronic communications (e.g., Twitter direct messages) without a search warrant. The companies have banded together with unlikely allies like the Electronic Frontier Foundation and EPIC to create the Digital Due Process coalition, a group whose name references the Fourth Amendment right to due process that prohibits unreasonable searches and seizures.

At long last, their efforts are gaining some real traction. Updated versions of the ECPA are making their way through both the House and the Senate right now, with Sen. Patrick Leahy’s bill arguably the most high-profile of the bunch.

The trends in user data requests from Google.

More generally, though, the third-party doctrine that Ozzie referred to is part of a larger legal theory that treats any information in the possession of someone else — your credit card transactions, call records, your journal, you name it — differently than if you alone were in possession of that information. It’s a hot topic of debate among legal scholars, and it seems the advent of the cloud has some members of the Supreme Court ready to weigh in on it should the right case arise.

In a 2012 case notable for its holding regarding the legality of warrantless GPS tracking, Justice Sonia Sotomayor addressed the bigger picture in a concurring opinion. She called the third-party doctrine “ill suited to the digital age, in which people reveal a great deal of information about themselves to third parties in the course of carrying out mundane tasks.”

“I would not assume,” she added, “that all information voluntarily disclosed to some member of the public for a limited purpose is, for that reason alone, disentitled to Fourth Amendment protection.”

Does national security talk louder?

Importantly, though, while ECPA governs the actions of law enforcement agencies investigating crimes or just trying to gather data, it doesn’t address the types of surveillance that the NSA carries out under the banner of national security. But the tech industry isn’t blind to laws such as the PATRIOT Act, either. Here’s what they had to say about data privacy in 2011, via a thinktank comprised largely of IT industry executives:

(1) modernize legislation (the Electronic Communications Privacy Act) governing law enforcement access to digital information in light of advances in IT; (2) study the impact of the USA PATRIOT Act and similar national security laws in other countries on companies’ ability to deploy cloud in a global marketplace; and (3) have the U.S. government take the lead on entering into active dialogues with other nations on processes for legitimate government access to data stored in the cloud and processes for resolving conflicting laws regarding data.

Already, it appears Europeans are searching for ways to withdraw from American service providers. Users in other parts of the world might, or should, be even more hesitant to use American services. And even if some Americans say they’re not creeped out by the government collecting their phone records (and, presumably, the rest of their digital communications), many are.

It’s hard to say how intensely the tech lobby will step up its privacy efforts in light of the NSA scandal, but it’s hard to imagine it will stay quiet if its constituents see potential users bailing on their services. And what’s bad for corporations in this situation is probably bad for the economy. A bad economy is bad for politicians always looking toward the next election.

It seems crazy to think the NSA will willingly give up its surveillance powers or that a court could come to a decision on this issue any time soon, but some members of Congress could be swayed to act. In a debate between privacy and the economy on one hand and national security on the other, you’d think something will have to give.

Feature image courtesy of Shutterstock user ramcreations.

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What this means in practice is that authorities in the United States and other countries are regularly demanding that Google hand over the keys to user accounts like Gmail or YouTube. In many cases, the government may have a legitimate reason to ask for such information, such as solving a crime or stopping a spying operation.

Other times, though, governments may simply be fishing for data in a way that flouts citizens’ right to privacy. Such fishing expeditions, unfortunately, are relatively easy in the U.S. thanks to the sprawl of so-called administrative subpoenas — a legal tool that lets agencies demand data without first proving to a judge that they have a right to get it. Google’s new stats, which for the first time break out the procedures U.S. governments used to gain information, show that 68 percent of all requests came by way of such subpoenas while only 22 precent came by way of search warrants. Here’s Google’s graphic:

The new stats not only highlight the nature of the modern surveillance society but also strengthen the case for updating the Electronic Communications Privacy Act, a 1986 law that sets out rules for how governments can collect personal information. Influential Senator Patrick Leahy (D-Vt), who chairs the Judiciary Committee, this week declared that reforming ECPA for the age of cloud computing is one of his top priorities.

So Facebook, where’s your report?

In releasing its findings, Google called on other companies and governments to “join us in this effort by releasing similar kinds of data.” Google has made similar appeals in the past but, so far, the only company to offer a report of its own is Twitter which last year published its first Transparency Report to coincide with Independence Day.

Facebook, however, has been conspicuously silent about government demands for data. In recent years, the social network has become a honeypot for federal agencies and other law enforcement powers that want to tap into the vast troves of information Facebook holds about users and their friends. While the government snooping is not Facebook’s fault (the company, after all, must comply with the law), it does raise the question of whether the company should join Google and Twitter in taking a more stance on raising civil liberties issues.

In response to a question about whether Facebook will produce a Transparency Report of its own, a spokesman provided the following statement:

We do not have any immediate plans to release a report, however, we have been working diligently on meaningful transparency such as the Law Enforcement Guidelines in the Help Center and our work with the Digital Due Process coalition to ensure the privacy of our users. While we will continue to evaluate our plans in this area, we devote our primary efforts to auditing every request we receive to ensure the strictest compliance with law. You can find out more here - http://on.fb.me/LEGuidelines

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This is scary stuff and could mark a new low point for privacy in America. Thank god, then, that the report wasn’t true. Instead, the “feds all up in your email” story appears to have been the latest attempt to exploit readers’ fears of a growing surveillance society. Here’s a quick look at what happened:

Panic over privacy

Last Tuesday, as Americans prepared to settle into days of turkey and TV, the tech news site CNET published an alarming story headlined: “Senate bill rewrite lets feds read your e-mail without warrants.”

According to CNET, the Chairman of the Senate Judiciary Committee, Patrick Leahy (D Vt), quietly rewrote a proposed law to give vast new investigative powers to 22 agencies like the Federal Reserve and the FCC. CNET pointed to excerpts from a draft bill to suggests agency gnomes would no longer even need a warrant to read your emails, Facebook musings or Google documents.

CNET’s would-be privacy bombshell soon received appropriate attention, even landing at the top of the Drudge Report. The site, which has a massive audience and enjoys embarrassing Democrats, reported it like this:

Other sites also began reporting on the Senate’s scary new plan to let agencies read our emails.

What really happened

Not everyone, however, took the CNET report at face value. Kashmir Hill, a veteran privacy reporter at Forbes, put it bluntly on Twitter:

The CNet report on a bill that would make warrantles searches of your email A-okay is bunk. Some flawed reporting there.

— Kashmir Hill (@kashhill) November 20, 2012

Hill soon issued a rejoinder to the CNET report, noting that the bill it cited was just one of many versions circulating in the Senate and was not one being taken seriously. She also pointed out that such a law would come at a disturbing time given the recent flap over General Petraeus’ email. Finally, Hill quoted a Leahy spokesman who said the article was “wrong.”

Other news outlets soon published additional denials from Leahy’s office. Meanwhile, sites like The New York Times, The Wall Street Journal and Politico simply ignored l’affaire Leahy altogether. (For a level-headed rundown of the whole episode, including how the feds can already read your email in some cases, see Wired’s report here.)

Whether CNET was set up by one of Leahy’s enemies or simply jumped the gun in reporting a draft bill isn’t clear. The only response to the controversy from the story’s author, Declan McCullough, was to write a follow-up piece that suggested CNET’s initial story had helped force Leahy to back down.

Crying Wolf

If nothing else, this non-scandal over email privacy reveals how these stories exist in a media sweet spot that taps public fears of technology, the government and big companies. News stories that confirm suspicions about an online Big Brother will always attract an audience, especially as they appeal to both liberals and right-wing libertarians.

Unfortunately, the widespread fears over online privacy also mean that it’s easy for the media to pander to them. Any headline with some combination of “privacy,” “Google” and “government” is likely to track well.

The bigger problem here is that online privacy is a serious issue — every day we turn more of our personal information over to the cloud with little assurances that it will remain safe from companies and governments. But every time the media points to smoke without fire, the greater the chance we will tune out genuine privacy threats.

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