Two U.S.-based email providers committed corporate suicide Thursday rather than comply with the government’s ongoing domestic spying programs. Although many in the business community have hesitated to criticize the government snooping on constitutional grounds, this development has led some to caution that it could have an adverse impact on the technology sector of the economy. Will greed save our rights when love of liberty could not?

Until last week, Lavabit, which was used by NSA whistleblower Edward J. Snowden, and Silent Circle, a fast-growing startup, provided encrypted email services for those who wanted extra privacy. Based on the carefully worded statements of company owner Ladar Levison, Lavabit likely received a secret search order relating to Snowden and is choosing to shut down to avoid being “complicit in crimes against the American people.” Levison shared his frustration on the company website: “I wish that I could legally share with you the events that led to my decision. I cannot.”

Silent Circle said it had received no search orders, but could see that such orders would be a part of its future, contrary to its mission of providing private communication tools. Both companies destroyed their servers to preserve the secrecy of their data.

According to the Justice Department, in 2012 the government made more than 17,000 secret demands for information: 1,856 under the Foreign Intelligence Surveillance Act, and 15,229 National Security Letters.

“This experience has taught me one very important lesson: without Congressional action or a strong judicial precedent, I would strongly recommend against anyone trusting their private data to a company with physical ties to the United States,” concluded Levison.

That point was amplified by others in the field. Tech blogger David Meyer wrote that “the closures strongly suggest that secure hosted email services cannot be sited in the U.S. without being compelled to compromise users’ privacy if asked to do so by the authorities there.”

Likewise Jennifer Granick, director of civil liberties at the Stanford Center for Internet and Society, wrote that “the U.S. government, in its rush to spy on everybody, may end up killing our most productive industry. Lavabit may just be the canary in the coal mine.”

-Matt Bewig

To Learn More:

2 E-Mail Services Close and Destroy Data Rather Than Reveal Files (by Somini Sengupta, New York Times)

Death Before NSA Dishonor: Encrypted Services Stage Suicide Revolt (by Jon Queally, Common Dreams)