Germany drops Verizon internet contract over NSA spying fears

German Chancellor Merkel and President Obama

Germany is irked that the NSA spied on its officials (including its Chancellor), and today it responded by hitting the US where it really hurts: the pocketbook. The German Ministry of the Interior has decided against renewing a Verizon internet service contract that expires in 2015, in no small part due to worries that the carrier must sometimes hand over foreign data to the NSA. The country has to reject companies that collaborate with the American intelligence agency if it's going to meet the "particularly high demands" of a critical communication infrastructure, according to the Ministry.

The nation had already been second-guessing the contract, so Edward Snowden's NSA surveillance leaks were really just the straws that broke the camel's back. However, the cancellation still validates US tech firms' worst fears -- they're losing business in countries which no longer feel they can trust American outfits with sensitive info. It's too soon to know whether this trend will continue, but it's clear that even close US allies aren't afraid to cut corporate ties if they believe their data is at risk.

[Image credit: AFP Photo/Jewel Samad]