The New York Times reports: Just as European and American negotiators resumed work on a groundbreaking trade accord meant to tie their two continents closer together, René Obermann, the chief executive of Deutsche Telekom, the German telecommunications giant, told a cybersecurity conference in Germany on Monday that his company was working to keep electronic message traffic from “unnecessarily” crossing the Atlantic, where it could fall into the hands of the National Security Agency.

Other German executives, and some politicians, are beginning to talk of segmenting the Internet, so that they are not reliant on large American firms that by contract or court order allow United States intelligence agencies to delve into their data about phone and Internet usage. Europeans are demanding that any new trade accord include data-privacy protections that the United States is eager to avoid.

Almost never before has a spying scandal — in this case the revelation of the monitoring of the cellphone of Chancellor Angela Merkel of Germany — resulted in such a concrete, commercial backlash. Now it is also driving a debate inside the American government about whether the United States, which has long spied on allies even while nurturing them as partners, may have to change its approach.

“What’s more important?” Gen. Keith B. Alexander, the director of the N.S.A., asked during an interview last month, before the Merkel revelations. “Partnering with countries may be more important than collecting on them,” he said, especially when it comes to protecting against cyberthreats to the computer networks of the world’s largest economies. [Continue reading…]