Spying Fears Abroad Hurt U.S. Tech Firms

The Wall Street Journal, Michael Hickins, Feb. 3, 2014

Google has said a potential law in Brazil could bar it from doing business
there. Pictured, its California headquarters. Getty Images

Revelations about the National Security Agency's eavesdropping on electronic communications have given governments overseas an opening to restrict U.S. technology companies, which some foreign politicians have depicted as too compliant with or complicit in the spying.

Germany's new governing coalition has issued a policy document that includes a call for using more technology developed in Europe, as well as open-source software, which is harder for potential eavesdroppers to penetrate.

Lawmakers in Brazil have been debating a bill that would require data about Brazilians to be stored within that country's borders. "There is a serious problem of storage databases abroad," Brazilian President Dilma Rousseff said recently. "That certain situation we will no longer accept."

On Monday, Google Inc., GOOG +0.49% Microsoft Corp., Yahoo Inc., YHOO +0.69% LinkedIn Corp. LNKD +0.09%  and Facebook Inc. FB +1.20%  released figures on how many requests for user information they received from U.S. intelligence agencies in the first half of last year. The reports followed an agreement by the Justice Department last week that allows such releases of broad figures with a six-month lag. Companies with popular email services–such as Google, Microsoft and Yahoo—had the most affected accounts.

If Brazil adopts its proposed new law, U.S. computer-services providers could be forced to build costly new data centers in that country to continue doing business there. Google, for example, the most popular Internet service provider in Brazil, may store emails and other data from its users on servers in the U.S., where it is subject to U.S. law.

Richard Salgado, Google's director of law enforcement and information security, told a Senate hearing in November that under the new law Brazil is considering Google could be "barred from doing business in one of the world's most significant markets or be obligated to pay hundreds of millions of dollars in fines."

Several U.S. tech companies have said the threat of such initiatives and privacy measures already on the books in countries such as Germany, France and Canada are hurting their business. Some of them have said they would build local data centers to help customers comply with new data-residency rules, but in many cases they will pass along the cost.

Meanwhile, some U.S.-based multinationals are worried that new laws abroad meant to shield personal data from spying could prevent them from moving their own business data from foreign affiliates to their home offices.

Daren Orzechowski, a partner at law firm White & Case LLC in New York, said "there is a concern that countries will put up barriers like this," and said they would come at a price. "It's going to weaken the benefit of the technology and impact the ability of people to conduct global e-commerce and to collaborate internationally," he said.

Daniel Castro, an analyst with the Information Technology and Innovation Foundation, a Washington-based think tank, said data-privacy rules and other restrictions now in force in some countries could slow the growth of the U.S. technology-services industry by as much as 4%.

In cloud computing, companies like Google's could be particularly vulnerable, because they constantly move their customers' data to server locations with excess capacity to get the most out of their networks. Corporate clients hire these companies to provide Web-based software and services like email and data storage. That strategy often allows businesses to cut costs or to add or subtract their computing resources as needed.

But some foreign cloud-computing clients are beginning to reassess their relationships with U.S. providers, responding to their own customers' concerns that private data could fall into U.S. government hands. Detlev Gabel, a White & Case partner in Frankfurt who advises clients on data privacy, said in an email that German companies are stepping up their scrutiny of potential IT providers and are looking more to European vendors.

Mr. Castro says new regulations could cost U.S. IT services companies up to $35 billion in revenue over the next three years.

Keller Williams Realty Inc., a U.S.-based real-estate franchising company with 700-plus offices in the U.S. and Canada, is building out its computing infrastructure to support an international expansion planned over the next 12 to 24 months, beginning with Turkey. The company relies on Google Apps to simplify email and data-management operations for its network's 95,000 users. It also uses Salesforce.com Inc. CRM -3.40%  's cloud platform for business applications that help brokers manage offers and steps required for closings.

Cary Sylvester, the company's vice president of technology innovation and communication, said cloud computing makes it easier to manage applications for Keller Williams's far-flung business but that the company might not be able to get by with just a single system world-wide.

"It would be a big annoyance" to have to find local vendors to comply with local regulations, she said. "That's part of the reason we chose to partner with Google and Salesforce, because they're going to have to solve that problem rfor themselves," she said.

Marc Benioff, chief executive of Salesforce.com, which markets sales-account-management, or CRM, software, said he hasn't "had a lot of inquiries from customers." He said that the data in the company's system belongs to its customers, and that his company "would never let a government or anyone else access that data without getting [customers'] permission. We do not provide any government with access to our servers, either directly or indirectly."

Mr. Benioff pointed out, however, that the type of data in many business databases, such as next quarter's projected sales to a given customer, would be of little interest to intelligence analysts. "CRM is boring," he said.

International Business Machines Corp. plans to open 15 new data centers in 2014, including one in China, to help its customers comply with local laws prohibiting data about their citizens from leaving the country.

A spokesman for Amazon.com Inc. AMZN -0.15%  's Amazon Web Services unit said its customers can choose to have their data reside in any of the company's 10 infrastructure regions world-wide, and that it will "continue to build out new regions regularly."

Mr. Benioff said that if customers asked Salesforce.com to open new data centers to comply with local regulations, the company would do so, but might charge them extra as a result.

That prospect troubles people like Ken Grady, chief information officer of New England Biolabs Inc., which supplies biotech labs. Mr. Grady said his company is planning to use Salesforce.com's service, beginning in April, and expects to be able to use the cloud-based application in all its locations, which include sites in Canada, Europe and Asia.

"It should be seamless, and it should be transparent to our organization in terms of use, with no change in functionality and scope."But he recognizes that things may not pan out that way. Mr. Grady said Salesforce.com has told him it is working to ensure that its facilities comply with applicable local laws abroad, but the company hasn't been able to tell him if this will add to his costs. "I expect it to be low. I'm going to push for it to be low, if at all," he said.

U.S.-based multinationals face another problem: figuring out how to move their own customer and employee data from overseas to their home offices.

"What if we're running Microsoft Dynamics and Brazil shuts it down, and we can't get the data out of there; what can Microsoft do to help us get the data out of that country?" said John Milazzo, CIO of KodakAlaris, a privately held document imaging company spun out of Eastman Kodak Co. Dynamics is used to manage financial and human-resources data such as revenues and payroll data.

Microsoft declined to comment, but pointed to an open letter signed by several large cloud vendors and a blog post by its chief legal officer, Brad Smith, which call on governments to curb electronic eavesdropping.

Andrew Bartels, an analyst with Forrester Research Inc., takes a more sanguine view of the spying revelations: "The NSA has given a particular face for that, but the risk [of data loss in the cloud] was already there through different means. Is this a bad thing for people to be aware that using cloud software poses risks? The answer is no," he said.

Mr. Bartels said that the revelations have given foreign countries the chance to foster rivals to Amazon.com or Google. "It will have and is having some reduction in growth rates for cloud vendors." But he added that cloud spending will simply shift elsewhere. "I don't think these U.S. technology firms have a God-given right to dominate," he said.

Corrections & Amplifications

An earlier version of this article incorrectly described Eastman Kodak Co., which has reorganized as a commercial-imaging company, as defunct. It also reported incorrectly that Amazon.com Inc.'s Amazon Web Services unit is among the cloud-computing companies that constantly move their customers' data to server locations with excess capacity to get the most out of their networks; in fact, its customers can pick the region in which their data will reside.

—Danny Yadron and Rachael King contributed to this article.

Write to Michael Hickins at michael.hickins@wsj.com

US, tech firms agree on spy agency data disclosure

Google – AFP, Rob Lever (AFP), 28 January 2014

Civil liberties activists hold a rally against surveillance of US citizens

in Washington on January 17, 2014 (AFP/File, Nicholas Kamm)

Washington — The United States agreed to give technology firms the ability to publish broad details of how their customer data has been targeted by US spy agencies, officials said.

Facing a legal challenge and a furious public debate, Attorney General Eric Holder and Director of National Intelligence James Clapper said the companies would now be allowed to disclose figures on consumer accounts requested.

"The administration is acting to allow more detailed disclosures about the number of national security orders and requests issued to communications providers," the officials said in a joint statement Monday.

US President Barack Obama speaks

 about the National Security Agency 

and intelligence agencies surveillance

 techniques in Washington, DC on

January 17, 2014 (AFP/File, Jim Watson)

In a letter to tech giants Facebook, Google, LinkedIn, Microsoft and Yahoo, the Justice Department freed them to release the approximate number of customer accounts targeted.

President Barack Obama's administration has faced pressure from the tech sector following leaked documents outlining vast surveillance of online and phone communications. The companies have said the reports have already begun to affect their business.

Facebook, Google, LinkedIn, Microsoft and Yahoo, which sued for the right to publish more data, said in a joint statement they were pleased with the settlement.

"We filed our lawsuits because we believe that the public has a right to know about the volume and types of national security requests we receive," the companies said.

"We're pleased the Department of Justice has agreed that we and other providers can disclose this information. While this is a very positive step, we'll continue to encourage Congress to take additional steps to address all of the reforms we believe are needed."

Under the agreement filed with the secretive Foreign Intelligence Surveillance Court the companies will be able to disclose the numbers, within ranges.

They will have an option to reveal within bands of 1,000 the numbers of "national security letters" and specific court orders. Another option will be to disclose, in bands of 250, all the national security requests, lumped together.

The reports will have a six-month lag time, so data for the second half of 2014 may be published in mid-2015, according to the agreement.

Previously, the existence of orders made by the secret for access to private online data was itself classified, to the outrage of the firms.

In addition to the bare numbers of targeted consumers, the companies will also be permitted to disclose the number but not the nature of selection criteria for broader Internet sweeps.

Civil liberties groups welcomed the deal, while arguing for even more transparency.

"This is a victory for transparency and a critical step toward reining in excessive government surveillance," said Alex Abdo, an ACLU attorney.

But Abdo said more is needed: "Congress should require the government to publish basic information about the full extent of its surveillance, including the significant amount of spying that happens without the tech companies' involvement."

Kevin Bankston of the New America Foundation's Open Technology Institute, called the news "an important victory in the fight for greater transparency around the NSA's surveillance programs" but said the agreement "falls far short of the level of transparency that an unprecedented coalition of Internet companies, privacy advocates and civil liberties organizations called for this summer."

A picture taken on October 26, 2013

 shows a portrait of Edward Snowden

 declaring him a "hero" during a protest

 against government surveillance in

Washington, DC (AFP/File, Mandel

Ngan)

"Meaningful transparency means giving companies the ability to publish the specific number of requests they receive for specific types of data under specific legal authorities," Bankston said.

"Fuzzing the numbers into ranges of a thousand -- and even worse, lumping all of the different types of surveillance orders into a single number -- serves no national security purpose while making it impossible to effectively evaluate how those powers are being used."

US tech firms have claimed that reports on the US government's secretive data collection programs have distorted how they work with intelligence and law enforcement. The firms have been asking for permission to disclose more on the nature of the requests and what is handed over.

Google's petition said that despite reports to the contrary, the US government "does not have direct access to its servers" and that it only complies with "lawful" requests.

The issue caught fire after Edward Snowden, a former IT contractor at the National Security Agency, revealed that US authorities were tapping into Internet user data.

Related Article:

Huge swath of GCHQ mass surveillance is illegal, says top lawyer

NSA surveillance: tech companies demand sweeping changes to US laws

Apple, Google and Microsoft among companies to call for reforms to restore the public's trust in the internet

   

theguardian.com, Dan Roberts in Washington and Jemima Kiss in London, Monday 9 December 2013

AOL, Twitter, Yahoo, Microsoft, Facebook, Google, Apple and LinkedIn say:
'The balance in many countries has tipped too far in favour of the state and away
from the rights of the individual'

The world's leading technology companies have united to demand sweeping changes to US surveillance laws, urging an international ban on bulk collection of data to help preserve the public's “trust in the internet”.

In their most concerted response yet to disclosures by the National Security Agency whistleblower Edward Snowden, Apple, Google, Microsoft, Facebook, Yahoo, LinkedIn, Twitter and AOL will publish an open letter to Barack Obama and Congress on Monday, throwing their weight behind radical reforms already proposed by Washington politicians.

“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,” urges the letter signed by the eight US-based internet giants. “This undermines the freedoms we all cherish. It’s time for change.”

Several of the companies claim the revelations have shaken public faith in the internet and blamed spy agencies for the resulting threat to their business interests. “People won’t use technology they don’t trust,” said Brad Smith, Microsoft's general counsel. “Governments have put this trust at risk, and governments need to help restore it.”

The chief executive of Yahoo, Marissa Mayer, said: “Recent revelations about government surveillance activities have shaken the trust of our users, and it is time for the United States government to act to restore the confidence of citizens around the world."

Silicon Valley was initially sceptical of some allegations about NSA practices made by Snowden but as more documentary evidence has emerged in the Guardian and other newspapers detailing the extent of western surveillance capabilities, its eight leading players – collectively valued at $1.4tn – have been stung into action amid fears of commercial damage.

“We understand that governments have a duty to protect their citizens,” they say in the letter. “But this summer’s revelations highlighted the urgent need to reform government surveillance practices worldwide.”

A separate list of five “reform principles” signed by the normally fiercely competitive group echoes measures to rein in the NSA contained in bipartisan legislation proposed by the Democratic chair of the Senate judiciary committee, Patrick Leahy, and the Republican author of the Patriot Act, Representative Jim Sensenbrenner.

Crucially, Silicon Valley and these key reformers in Congress now agree the NSA should no longer be allowed to indiscriminately gather vast quantities of data from individuals it does not have cause to suspect of terrorism in order to detect patterns or in case it is needed in future.

“Governments should limit surveillance to specific, known users for lawful purposes, and should not undertake bulk data collection of internet communications,” says the companies' new list of principles.

They also argue that requests for companies to hand over individual data should be limited by new rules that balance the “need for the data in limited circumstances, users’ reasonable privacy interests, and the impact on trust in the internet”.

This places them in direct conflict with Dianne Feinstein, the Democratic chair of the Senate Intelligence Committee, who is sponsoring a rival bill that would enshrine the right of security agencies to collect bulk data.

Feinstein, who represents California, has been accused by critics of being a cheerleader for Washington's intelligence committee but now faces opposition from her state's largest industry.

The companies also repeat a previous demand that they should be allowed to disclose how often surveillance requests are made but this is the first time they have come together with such wide-ranging criticism of the underlying policy.

The industry's lobbying power has been growing in Washington and could prove a tipping point in the congressional reform process, which has been delayed by the autumn budget deadlock but is likely to return as a central issue in the new year.

The Feinstein and Leahy/Sensenbrenner bills agree with technology companies that there should be greater transparency of court rulings regulating surveillance and more opportunity for privacy advocates to argue against intelligence agency requests.

The eight technology companies also hint at new fears, particularly that competing national responses to the Snowden revelations will not only damage their commercial interests but also lead to a balkanisation of the web as governments try to prevent internet companies from escaping overseas.

“The ability of data to flow or be accessed across borders is essential to a robust, 21st century, global economy,” the companies argue in the list of reform principles. “Governments should permit the transfer of data and should not inhibit access by companies or individuals to lawfully available information that is stored outside of the country. Governments should not require service providers to locate infrastructure within a country’s borders or operate locally.”

And they argue foreign governments need to come together to agree new international standards regulating surveillance, hinting at legal disputes and damage to international trade otherwise.

“In order to avoid conflicting laws, there should be a robust, principled, and transparent framework to govern lawful requests for data across jurisdictions, such as improved mutual legal assistance treaty – or “MLAT” – processes,” say the companies. “Where the laws of one jurisdiction conflict with the laws of another, it is incumbent upon governments to work together to resolve the conflict.”

Official responses to the Snowden revelations have been angriest in countries subject to US surveillance such as Germany and Brazil, but more muted in countries such as Britain and Australia, whose governments are close partners of the NSA.

Martha Lane Fox, who recently resigned as the British government's digital champion, responded to the new letter by expressing concern at the lack of understanding of both the scale and complexity of the surveillance story within Britain's government.

"We do have an issue in this country among the corporate world, the political establishment and the general population where we have a shortage of skills and understanding for the digital age," she told the Guardian. "There is an absence of a clear, coherent debate around this subject in this country and it's a very big issue that will only become more frequent the more technologically dependent we become."

She pointed to comments made by the former Conservative home office minister Lord Blencathra and the Labour peer Lord Soley, who both expressed concern at the scope of surveillance by the security services.

"[The government] needs to listen to people, to examine whether their policies are fit for the digital age. It's not that people aren't used to their data being collected, but what it is being collected for, and there needs to be a distinction between the average person and a security threat."

The eight internet companies behind the new letter also acknowledge that business also has a responsibility to protect privacy.

“For our part, we are focused on keeping users’ data secure, deploying the latest encryption technology to prevent unauthorised surveillance on our networks, and by pushing back on government requests to ensure that they are legal and reasonable in scope,” they conclude.

“We urge the US to take the lead and make reforms that ensure that government surveillance efforts are clearly restricted by law, proportionate to the risks, transparent and subject to independent oversight.”

Google, Twitter, Yahoo and last week Microsoft have all responded to public concerns over surveillance by increasing the security of their products, introducing “perfect forward secrecy” encryption to protect information travelling on their internal systems.

"The security of users' data is critical, which is why we've invested so much in encryption and fight for transparency around government requests for information,” said Google's chief executive, Larry Page.

“This is undermined by the apparent wholesale collection of data, in secret and without independent oversight, by many governments around the world. It's time for reform and we urge the US government to lead the way.”

Related Articles:

Tech giants' demand for NSA reform 'a major game-changer', advocates say - New

Indian government wakes up to risk of Hotmail, Gmail

Brazil announces secure email to counter US spying

Telekom hopes to stave off NSA snoops by keeping Internet traffic in Germany

BRICS announce joint cybersecurity group

LinkedIn Acknowledges Password Breach

Jakarta Globe, June 07, 2012

In this May 9, 2011 file photo, LinkedIn Corp., the professional networking
 Web site, displays its logo outside of headquarters in Mountain View, Calif.
LinkedIn said on Wednesday, June 6, 2012, it is investigating reports that
more  than six million passwords have been stolen and leaked onto the Internet.
(AP Photo/Paul Sakuma) 

           

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• Facebook Founder’s Ode to ‘The Hacker Way’

The professional social network LinkedIn said Wednesday some of its members’ passwords were stolen after reports said more than 6.4 million accounts were breached.

“We can confirm that some of the passwords that were compromised correspond to LinkedIn accounts. We are continuing to investigate this situation,” LinkedIn director Vicente Silveira said in a blog post.

“We sincerely apologize for the inconvenience this has caused our members. We take the security of our members very seriously.”

Silveira said passwords on the compromised accounts were no longer valid, and that those members will receive instructions on how to reset their passwords.

“There will not be any links in these e-mails. For security reasons, you should never change your password on any website by following a link in an e-mail,” he said.

For other members, LinkedIn has implemented “enhanced security” for password protection, he added.

Several security researchers reported the breach, which resulted in data being posted on a Russian hacker forum.

Graham Cluley of the British security firm Sophos said the hacker posting “does contain, at least in part, LinkedIn passwords.”

“Although the data which has been released so far does not include associated e-mail addresses, it is reasonable to assume that such information may be in the hands of the criminals,” Cluley said in a blog post.

As a result, Cluley said, “it would seem sensible to suggest to all LinkedIn users that they change their passwords as soon as possible as a precautionary step.”

He said users should ensure the password you use is not used on any other websites, and hard to crack.

“If you were using the same passwords on other websites — make sure to change them too. And never again use the same password on multiple websites,” he said.

Jim Walter of the McAfee Threat Intelligence Service said the breach is “a good reminder to all internet users on the importance of maintaining an ever-changing and complex password. A secure passphrase may be the only thing standing between your personal data and those that wish to steal it.”

Just a day earlier, LinkedIn was subject to criticism by a security firm for allowing too much information to be revealed from its mobile application for Apple devices which use the iOS platform.

“LinkedIn’s mobile application has an interesting feature that allows users to view their iOS calendars within the app. However, it turns out that LinkedIn have decided to send detailed calendar entries of users to their servers,” said Adi Sharabani and Yair Amit of Skycure Security.

This means “highly sensitive information such as conference call details and passcodes” could be revealed, they said in a blog.

“We do not believe it utilized the collected information in a malicious way. However, we are concerned by the fact it collects and sends out sensitive information about its users, without a clear indication and consent.”

LinkedIn claims to operate the world’s largest professional network with 161 million members in 200 countries.

The company, which went public last year at $45 a share, has doubled in value despite woes about social networks. Shares closed up marginally at $93.08 on Wednesday.

It posted a profit of $5 million in the past quarter on revenues of $188 million.

A recent survey showed LinkedIn is the most popular US site for posting jobs with 77 percent of openings shared there.

Agence France-Presse

The Netherlands Ranks #1 Worldwide in Penetration for Twitter and Linkedin

Hyves Maintains Position as Top Social Networking Site in the Netherlands Despite Facebook’s Rapid Advances

London, UK, 26 April, 2011 – comScore, Inc. (NASDAQ: SCOR), a leader in measuring the digital world, today released a study of social networking usage in the Netherlands based on the comScore Media Metrix service. The study reveals that the Dutch social networking market continues to grow strongly as sites like Facebook, Twitter and Linkedin extend their respective footprints in the market.

“The social networking market in the Netherlands is really quite unique and full of interesting storylines,” said Mike Read, svp and managing director of comScore Europe. “It is one of the few markets remaining where a local social networking player [Hyves] continues to lead Facebook, but that lead is becoming increasingly tenuous. Another interesting facet to this market is that the Netherlands has the highest Internet penetration worldwide for two of the other key global social networking sites, Twitter and Linkedin. The Netherlands is in many ways a nexus of global social networking behavior.”

Hyves Leads Facebook in Dutch Social Networking Market

Despite the overall maturity of the Internet market in the Netherlands, the social networking category continues to advance, growing 18 percent to 11.5 million visitors in March 2011 (representing 96 percent of the online population). Hyves continues to hold the top position among social networking sites in the market with more than 7.6 million visitors in March, but Facebook is quickly gaining ground, surging 76 percent in the past year to nearly 6.6 million visitors. Twitter.com and Linkedin.com rank third and fourth, respectively, with more than 3 million visitors and each growing approximately 70 percent in the past year.

*Excludes visits from public computers such as Internet cafes or
access from mobile phones or PDAs. (Source: comScore Media Metrix)

Netherlands Ranks #1 in Linkedin and Twitter Penetration

The Netherlands also has an exceptionally high representation among social networking sites Twitter.com and Linkedin.com, ranking #1 among all countries in Internet penetration for these sites. In each case, more than one in four Dutch Internet users visits these sites during the course of the month. While the top ten countries in Linkedin penetration are either English-speaking or in Western Europe, the top countries for Twitter touch virtually every corner of the globe.

(Source: comScore Media Metrix)

About comScore

comScore, Inc. (NASDAQ: SCOR) is a global leader in measuring the digital world and preferred source of digital marketing intelligence. For more information, please visit www.comscore.com/companyinfo

Related Article:

How the Netherlands took to the Internet

LinkedIn Founder: Web 3.0 Will Be About Data

Masable, March 31, 2011

LinkedIn founder and chairman Reid Hoffman says that the future of the web will be all about data and how we utilize it.

LinkedIn founder and chairman Reid Hoffman

While he conceded that mobile is an obvious candidate for what will define “Web 3.0,” he said that data will be the platform of the next era of the web. “This is where some massive innovation will happen that will transform our lives,” he told Liz Gannes of AllThingsD on stage, during a fireside chat at the Web 2.0 Expo in San Francisco.

Hoffman, who is now a partner at venture capital firm Greylock Partners, says that data will come in two forms: explicit and implicit. Explicit data is data that users willingly give to social networks, blog posts and tweets, while implicit data is data collected in the background, like geolocation information.

There are also two types of data sets, he said: tightly held sets (passwords, credit card numbers) and open sets. He cited Google as a company focused on the open data set, since in order for its search engine to be functional, it needs website data to be publicly available and indexable by its bots so it can be delivered as search results.

All of this data will lead to a lot of interesting products and insights. He cited LinkedIn Skills as an example of how analyzing user data can result in useful insights and reveal trends — figuring out things like which industries are growing the fastest and which skills are related to each other.

Hoffman also had a strong opinion of what companies should do with the data they collect. “Good Internet companies do not ambush their users,” he said. Both Google and Facebook have been criticized for their use of user data and their treatment of user privacy. Google in fact settled with the FTC on Wednesday in relation to “deceptive tactics” the company used with Google Buzz.

India survey says Facebook affects productivity

BBC News

Nearly half of employees questioned accessed Facebook at work

Indian firms are losing productivity because office staff spend too long on social networking sites, a survey says.

The Associated Chambers of Commerce and Industry (Assocham) says workers use Orkut, Facebook, Myspace and Linkedin for "romancing" and other purposes.

Office employees questioned in the survey spent on average an hour a day on sites like Facebook, leading to productivity loss of nearly 12.5%.

The findings were based on responses from nearly 4,000 corporate employees.

'Dangerous'

"Close to 12.5% of productivity of human resource in corporate sector is misappropriated each day since a vast majority of them while away their time accessing social networking sites during the office hours," according to the findings of Assocham's Social Development Foundation survey.

"As a matter of fact, [the] growing use of browsing sites can be dangerous for overall productivity and IT companies have already installed software to restrict its use," Assocham secretary general DS Rawat said.

The survey questioned 4,000 employees between the ages of 21 and 60 in Delhi, Bangalore, Madras (Chennai), Cochin, Indore, Ahmedabad, Surat, Mumbai (Bombay), Pune, Chandigarh, Dehradun, Lucknow and Kanpur.

The survey found that 77% of workers who had Orkut accounts used them during work hours.

Nearly half of office employees accessed Facebook during work time.

Moreover, four in every 10 workers built their entire Orkut or Facebook profile at work, the survey found.

Some 83% saw nothing wrong in surfing at work during office hours.

According to the survey, 19% of companies allow use of social networking sites only for business purposes, while 16% allow limited personal use.

Only 40% of the employees interviewed said that their companies allowed staff full access to social networking sites.

The survey also says that 84% of respondents in India's major cities show signs of internet addiction - they do not take breaks at appropriate times, they spend more than a "normal" amount of time online, and can get irritable if they are interrupted while surfing.

In September, Portsmouth City Council in southern England banned staff from accessing Facebook on its computers after it was revealed they spent on average 400 hours on the site every month.

The move was expected to stop the "waste of public cash".