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Surveillance Concerns Threaten Sales of U.S. Technology to China

U.S. makers of IT equipment may see slower sales in China because of the disclosure of the PRISM surveillance program by Edward Snowden, says Nomura Securities in a report.

Leping Huang, a Nomura analyst, says Chinese government concern over the PRISM program could impact buying decisions by mainland-based companies. He says Hong Kong-listed Digital China, spun off by Lenovo Group in 2000, could see slower sales until the controversy eases.

"Although it remains unclear whether U.S. enterprise equipment manufacturers have played any role in this surveillance program, we think telecom carriers and large enterprises in China may become reluctant to purchase U.S. equipment in the future until potential security risks are fully clarified," Huang wrote in a report.

Source: Investors Business Daily. Read full article. (link)

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