Internet and Cloud Data Regulation Instructive for Satellite Services Providers

By | November 19, 2013 | Publications, Via Satellite

The past several months have seen intensive governmental activity to legislate data protection for Internet and cloud services across Europe, South America and Asia. As global data services become more important across satellite and other delivery infrastructures, satellite operators – long familiar with lawful intercept requirements – should take note of trends that, increasingly, suggest a need not just to protect consumer privacy, but to enable greater control over networks more broadly.

In the context of projected growth of M2M services (Internet of things, industrial Internet, Internet of everything), what might this mean for the satellite industry? In places where data localization requirements are emerging, will this also signal more controls on other infrastructure – such as tightening of gateway and lawful intercept requirements, long in place in restrictive markets like Russia and India, or more requirements for use of local partners whose networks can be more readily monitored by national authorities?

The majority of M2M growth is expected to be in industrial data communications such as transportation and logistics and the extractive industries. As it becomes increasingly embedded in consumer applications, however, including in the energy (smart meters), transportation (“e-call” initiatives) and health (wearable monitors) sectors, the data generated will be subject to data privacy laws. While many of these applications will use terrestrial networks, many will also rely on satellite.

Because the delivery mechanisms (mobile, fixed, satellite) are already largely regulated, very few countries have ventured to regulate M2M further. Thus far China, Korea, Singapore, the United Kingdom, Spain, Belgium, and Brazil are among those known to be taking measures to adjust their environments so that they can better use M2M, including stretching national numbering resources, spectrum efficiency, and standards. This is likely to be just the start. International data carriage and storage will be increasingly affected by the debates playing out among data privacy and cloud computing regulators.

PRISM Fallout
The most significant debate on data privacy is within Europe, spurred by Edward Snowden’s revelations about the U.S. PRISM surveillance program. At the time of writing, Europe entertained (though will likely dispense with) a proposal for a “Schengen area for data,” effectively erecting barriers around the storage and transfer of data within Europe. Emergent cloud computing regulation currently under consideration will be heavily influenced by this idea.

The Brazilian government is considering addressing data localization requirements to be addressed in its “Marco Civil” legislation or, alternatively, in its Data Protection Legislation due for consideration in November. The government is considering whether to force only large companies to comply with the data localization requirement, but it could apply even to smaller ones.

Vietnam recently passed “Decree 72,” requiring the servers of Google and its likes to be located in-country and also restricting the political content users are permitted to post online. This bolsters existing content-filtering requirements, including a 2009 block of Facebook by the Ministry of Public Security.

As the concept spreads, however, satellite operators also need to be aware that requirements to locate data centers in individual countries where the customer is served will mean losing the scale achieved by such global businesses, as well as the flexibility to locate data where the business model dictates.

Satellite operators may find in these measures echoes of requirements for local gateways and lawful intercept capabilities. In the main, those countries (except in Europe) that have pushed increasing control of the Internet and its infrastructure are also those whose restrictions on foreign providers are tight or tightening.

Satellite’s Fight Too
The line between assurances of privacy and assertions of greater control over networks may be getting thinner. As global data services grow, the satellite community would do well to watch developments in the ICT sector carefully, and share in the burden of rejecting restrictive regulations. The satellite industry itself is likely to suffer in leaving the fight to others.

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