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Apple Inc. (AAPL), Google Inc (GOOG), Facebook Inc (FB): PRISM, Should Tech & Social Media Investors Brace for Impact?

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The PRISM anti-terrorism program was created to give the government access to emails, videos, social media posts and just about every other bit of data a web user could provide in order to ‘combat terrorism.’ When the story broke on June 6 in the U.K’s Guardian and The Washington Post that nine companies handed over direct access to their servers to the National Security Agency, investors started to question whether the stock of these companies would take a hit, being embroiled in scandal and questions. But, based on trends and what I believe to be three very important yet overlooked factors, major consumer tech companies Apple Inc. (NASDAQ:AAPL), Google Inc (NASDAQ:GOOG) and Facebook Inc (NASDAQ:FB) are unlikely to falter based on the leak.

Google Inc (GOOG)

We knew it was happening

The first reason these companies won’t budge is because we knew that this was happening already. President Obama stated in his defense of the NSA and its actions that under his predecessor, obtaining information would “help us prevent terrorist attacks.” He also insisted on the importance of striking the balance between keeping the American people safe and concerns about privacy. Trade-offs are inevitable, however, as they are an irrefutable part of our post 9/11 life.

We also know that this entire process is flyspecked by the special court created by the 2008 Foreign Intelligence Surveillance Act, or FISA, which was most recently amended in December with little controversy or even media notice. Whether or not the Obama administration is conceding that we all knew surveillance of some kind was going on is one thing, but we do know that the administration is magnanimously offering a bit of clarification as to the whys and wherefores. The field known as “big data” is revolutionizing everything from retail to traffic patterns. Organizing and making sense of this raw material is now possible given advances in high-performance computing and storage capacity.

And that’s what the NSA is doing – collecting “metadata,” nonspecific bits of information related to calls and other electronic communications received and sent. Investors should take note of this trend – companies which harness big data could have real potential for long-term growth. Facebook Inc (NASDAQ:FB), already eying this trend, has implemented a program focused on teaching big data tools to its employees.

We don’t care

The second reason these companies are safe is because Wall Street and the majority of Americans are indifferent. First, as explained by Obama, the paradox of data-mining is that the more information the government collects the less of an intrusion it is. These data sets are so large that only algorithms can understand them.

Second, the information gathered were from increasingly social-tech companies. Facebook is a social networking site, where people post anything and everything about their own personal (and private) lives. Engagement with this platform presupposes that users are okay with everyone knowing their business.

Likewise, Google and Apple Inc. (NASDAQ:AAPLhave made steps to make their programs more interconnected. Privacy policies aside, both companies know (and make users aware) that success lies in making all things communicate with all others in order to have everything at ones fingertips. Gmail, YouTube, iTunes, etc are all moving to put your personal life and habits ‘out there’ so you can access it anywhere you are.

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