The German government requires undertakings from contractors that it won't divulge information to other parties. It seems the Germans weren't convinced that Verizon could provide such undertakings.
"There are indications that Verizon is legally required to provide certain things to the NSA, and that's one of the reasons the cooperation with Verizon won't continue," says the German Interior Ministry.
The Ministry's spokesman went on to say: "Furthermore, the ties revealed between foreign intelligence agencies and firms in the wake of the US National Security Agency affair, show that the German government needs a very high level of security for its critical networks."
The move will send a chill down the spine of many US businesses which are losing business overseas because they are seen as agents, witting or unwitting, of the NSA.
The US Information Technology and Innovation Foundation, which includes IBM and Intel, estimates that the spies will cost them $35 billion in lost business abroad between now and 2016.
Recently Vladimir Putin announced that x86 processors in government computers would be replaced by'Baikal' - a yet-to-be developed processor using a 64-bit ARM core.
Qualcomm CEO Paul Jacobs says he's “seeing increased pressure” in China because of revelations about NSA snooping on targets China.
Cisco says it has already lost business in China because of the spies.
Microsoft, Facebook, Google, Yahoo, AOL, Apple, LinkedIn, and Twitter, have formed a group called Reform Government Surveillance which wrote to President Obama last summer saying: "This summer's revelations highlighted the urgent need to reform government surveillance practices worldwide. The balance in many countries has tipped too far in favour of the state and away from the rights of the individual -- rights that are enshrined in our Constitution."
Sometimes one wonders if Edward Snowden will return to the USA one day and run for President.