Opinion | A battle over data is the new front in the US-China trade war

Many years ago, while I was on a phone call with a colleague in the US, he loudly proclaimed mid-call, that he was a patriot who had served his country’s military “just to be clear for the Great Recorder of all phone calls”. Needless to say, I was intrigued by his behaviour. My interlocutor had been mildly critical of the US’ then immigration policy for skilled technical workers, but had said nothing out of the ordinary, and nothing which had not already been reported to the press. When I pressed him on why he had interrupted the conversation with his proclamation, he replied that he suspected that the US government had access to all phone calls made from or to the US.

This call occurred long before 2013, when Edward Snowden disclosed that the National Security Agency (NSA) had indeed been accessing calls for a long time. A quiet executive order passed by then President George W. Bush in the wake of the 9/11 attacks had given broad, sweeping powers to the NSA, and it was indeed monitoring call data records (CDRs). As actions like these require ratification, a secret court hearing allowed Bush’s order to be implemented. Given that the US was reeling after what was essentially an act of war, it is un- surprising that the court ratification happened without much public discourse. Most Americans were blissfully unaware that their government was indeed spying on them. Snowden had his US passport revoked for making that disclosure and spent over a month in the transit lounge at Moscow’s international airport before finally being given asylum by that country.

Expectedly, Snowden’s disclosure raised privacy concerns in the US. The US Congress replaced Bush’s programme with the USA Freedom Act in 2015. The Act expires at the end of this year, but it appears that the NSA is no longer interested in obtaining billions of CDRs every day. In a New York Times article last week, that paper asserts that the NSA’s programme has not been used in months and that the NSA has quietly shut down this programme.

This is not a surprise. On 28 June last year, the NSA itself issued a press announcement saying it was deleting CDRs. An excerpt from that announcement states “Because it was infeasible to identify and isolate properly produced data, NSA concluded that it should not use any of the CDRs.” This could well be because the NSA realizes that it has other tools at its command, including access to detailed location data for the billions of people worldwide who use Big Tech platforms. Today’s Big Tech companies are all US based and that is where their data resides. Despite Apple Inc’s capitulation last year to the Chinese government, where it promised to keep data from Chinese iCloud users in China, other firms have exited the Chinese market. Besides, being a US company, it is entirely possible that Apple keeps a mirror of its China users’ data in a database that resides in the US. The fact that these data are available to US intelligence agencies on their own native soil allows them the comfort that they can always access such data should they want or need to.

In a separate area, there is now news that the NSA has released a powerful open-source reverse-engineering hacking tool called Ghidra into the public domain. Ghidra reduces programming code down to the level of “Assembler” language, which is an expression of programming code down to the level of machine level instructions into the binary 1s and 0s that are understood by computer chips. Tools like these exist today but cost a large amount of money to procure. Ghidra’s release levels the playing field and has been welcomed by many. However, not all experts are convinced that this is a selfless gesture, because they believe that the Ghidra code may well have “back doors” into computer systems and telecommunications networks.

Meanwhile, the NSA and its sister agencies are making sure that non-US governments will not have an easy time if they seek to access similar back doors to user data. In February last year, six top US intelligence chiefs from the NSA, CIA, FBI and other agencies told a US Senate committee that they believed that China’s Huawei and ZTE were not to be trusted because they could allow China’s government a back door into communications infrastructure, thereby giving Chinese intelligence agencies broad access into personal data and other sensitive information. The FBI director at the time, Chris Ray, testified, “We’re deeply concerned about the risks of allowing any company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks.”

Huawei now faces a ban on its equipment in the US as legislation passed last year restricted its equipment in the US. The company is now suing the US government, calling the move “unconstitutional”. Huawei’s chief financial officer Meng Wanzhou, the daughter of founder Ren Zhengfei, faces potential extradition from Canada to the US over charges of Iran sanction violations. Despite the ban and Meng’s detention, Huawei is now a force to contend with. Its 2018 revenue was $109 billion, just a smidgen short of Microsoft Inc.’s $110 billion. It is also now one of the world’s largest smartphone makers, having eclipsed Apple some time ago.

It appears that the background battle between American and Chinese intelligence agencies for hegemony over sensitive data is yet another frontier in the ongoing US-China trade war.

Siddharth Pai is founder of Siana Capital, a venture fund management company focused on deep science and tech in India.