Today: Google (GOOG) requests ability to release more data about NSA's requests for data, and Facebook and Microsoft are on board. Also: Wall Street drops as Google's Waze deal and Facebook's shareholders meeting fail to spark stocks.
The Lead: Google. Facebook, Microsoft continue to fight Prism accusations
Days after officially denying reports of the National Security Agency's blanket access to users' information, Google and Facebook continued to fight the accusations Tuesday, with Google requesting federal-government approval to release more data that it believes will show its reticence to hand over consumer data, and others joining the cause.
The NSA's Prism program was revealed last week, when government contractor Edward Snowden released information on a government warrant that allowed the feds daily access to the phone records of Verizon customers. A Washington Post report that followed claimed that feds were "tapping directly into the central servers of nine leading U.S. Internet companies" -- including Silicon Valley heavyweights Apple (AAPL), Google, Facebook and Yahoo (YHOO). The companies immediately denied offering such access to the government, with Facebook CEO Mark Zuckerberg and Google CEO Larry Page issuing similar statements -- Zuckerberg said: "We do not provide any government organization with direct access to Facebook servers," while Page stated: "We have not joined any program that would give the U.S. government -- or any other government -- direct access to our servers."
On Tuesday, Google Chief Legal Officer David Drummond, who cosigned the earlier blog post with Page, posted again on the Mountain View search giant's corporate blog. The new post contained a letter to Attorney General Eric Holder and FBI Director Robert Mueller requesting that the company be allowed to share information about requests for information from the secret Foreign Intelligence Surveillance Act warrants that allowed access to the Verizon records.
Drummond wrote that government protections against sharing such information was blocking Google from clearing its name.
"Assertions in the press that our compliance with these requests gives the U.S. government unfettered access to our users' data are simply untrue. However, government nondisclosure obligations regarding the number of FISA national security requests that Google receives, as well as the number of accounts covered by those requests, fuel that speculation," Drummond wrote.
Google prides itself in being as transparent as possible about law-enforcement requests for user data, publishing a yearly wrap-up of how many requests were received from the U.S. and other governments and its number of compliances, along with other data. Earlier this year, the company received permission to include FBI requests for data in that report, and Drummond requested the ability to do the same for requests from the secretive FISA court.
"Transparency here will likewise serve the public interest without harming national security," he concluded.
Facebook and Microsoft later joined in Google's request with statements echoing the desire to release more information.
"We would welcome the opportunity to provide a transparency report that allows us to share with those who use Facebook around the world a complete picture of the government requests we receive, and how we respond," Facebook said in a statement. "We urge the United States government to help make that possible by allowing companies to include information about the size and scope of national security requests we receive."
"Permitting greater transparency on the aggregate volume and scope of national security requests, including FISA (Foreign Intelligence Surveillance Act) orders, would help the community understand and debate these important issues," Microsoft wrote. "Our recent report went as far as we legally could and the government should take action to allow companies to provide additional transparency."
Facebook's Zuckerberg also offered slightly more at the Menlo Park company's annual shareholders meeting. After again saying Facebook does not provide "direct access" to its servers, and has never been asked by the government to do so, he responded to a question about what kind of access Facebook does provide.
"The reality is anyone can go to Facebook.com and get indirect access to our service," Zuckerberg said, according to TechCrunch. "No agencies have direct access and can plug into our servers and get information ... the process that government agencies go through if they want to get a warrant is similar to what police do in any court case, and we basically give the minimum amount of information" necessary.
Meanwhile, another Silicon Valley stalwart, Mountain View's Mozilla Foundation, joined a coalition seeking to confront the practice. Mozilla, which offers the Firefox Web browser, kicked off the "Stop Watching Us" campaign with the Electronic Frontier Foundation, American Civil Liberties Union and other groups to seek an end to the surveillance and force a full accounting of what has happened so far. The ACLU took the next step later Tuesday, filing a lawsuit against members of President Barack Obama's national security team seeking an end to the Verizon surveillance.
SV150 market report: Tech stocks take a dive as indexes sink
Neither Google nor Facebook found relief on Wall Street on Tuesday, as the companies' stocks took a dive despite a big acquisition for Google and Zuckerberg's contention that the company's shares will rise. The declines were part of a rocky day for Wall Street indexes, as two of the three major U.S. indexes declined at least 1 percent and the SV150 dropped 1.1 percent.
Google reportedly completed its fourth-largest acquisition of all time, paying more than $1 billion for Waze, a social-mapping service that previously was reported to be an acquisition target for Apple and Facebook. The acquisition, which Google will use to boost its Maps service, would rival Yahoo's purchase of Tumblr as the third-largest acquisition in the valley this year if the reported billion-dollar price is correct, trailing only Oracle's (ORCL) Acme Packet buy and Salesforce's purchase of ExactTarget. Google shares slid 1.2 percent on the day to $879.81.
Facebook stock dropped 1.2 percent as well, closing at $24.03 after the company's first shareholders meeting since going public in 2012. Zuckerberg acknowledged frustration with Facebook's dwindling stock price, which has dropped from $38 in its initial public offering, but stood by the company's product. "None of the trends that we see right now seem like they should get in the way of our success in any meaningful way," he said. A Credit Suisse analyst debunked Monday's reports of Facebook being added to the Standard & Poor's 500 index, however, "due to its sector and spotty earnings performance."
The SV150's cleantech index took a big hit Tuesday: Electric car maker Tesla dropped 5.6 percent to $94.47, San Mateo solar installer SolarCity declined 5.1 percent to $34.48, and San Jose solar manufacturer SunPower (SPWRA) decreased 6.4 percent to $20.06. Software was also a soft spot: Oracle fell 1.4 percent to $33.57, Adobe (ADBE) declined 2.2 percent to $43.12, Intuit (INTU) dropped 2.1 percent $57.73, and Symantec lost 1.1 percent to close at $22.01.
Up: VMware, Zynga, Palo Alto Networks, NetApp
Down: Workday, SunPower, Tesla, SolarCity, Juniper, LinkedIn, Netflix (NFLX), Advanced Micro Devices, eBay (EBAY), Adobe, Intuit, Nvidia, Applied Materials, Oracle, Yelp, Ruckus, Yahoo, Facebook, Intel (INTC), Cisco (CSCO), EA, Google, Symantec, Hewlett-Packard
The SV150 index of Silicon Valley's largest tech companies: Down 14.29, or 1.12 percent, to 1,257.15
The tech-heavy Nasdaq composite index: Down 36.82, or 1.06 percent, to 3,436.95
The blue chip Dow Jones industrial average: Down 116.57, or 0.76 percent, to 15,122.02
And the widely watched Standard & Poor's 500 index: Down 16.68, or 1.02 percent, to 1,626.13
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/mercbizbreak.