Representatives from some of the biggest names in tech had some harsh words to say about the US government surveillance scandal on Wednesday during a meeting examining the potential ramifications of the spying activities.

The special event in Palo Alto involved the likes of Google chairman Eric Schmidt, Microsoft general counsel Brad Smith, and Dropbox representative Ramsey Homsany, Cnet reported.

The panelists put their views to Democratic senator for Oregon Ron Wyden , with Schmidt warning that the impact of the surveillance is not only “severe and getting worse,” but could even end up “breaking the Internet.”

Former NSA contractor Edward Snowden last year blew the lid off the government’s surveillance activities, releasing official documents that showed surveillance of Web users to be far more extensive than most people had imagined.

Global effects

During the meeting, the speakers focused on the global knock-on effects of the Snowden revelations, highlighting how some governments are seeking to make tech firms build data centers within their borders in a bid to improve security. If every country ends up following this path, the tech companies said, the costs would be astronomical and could ultimately damage the US economy.

Related: Google’s Schmidt blasts NSA activities

Fallout from the NSA scandal has already hit American firms, including Verizon, which recently lost its contract with the German government over concerns linked to network security. Snowden’s documents suggested that more than 120 world leaders were targeted for surveillance by the NSA, with German leader Angela Merkel among them.
Trust issues

Microsoft’s Brad Smith also voiced concerns at the Palo Alto meeting, saying that in the same way as someone wouldn’t leave their money with a bank they don’t trust, nor would they use an Internet they don’t trust.

Ramsey Homsany of Dropbox backed up the other speakers with the assertion that the faith and confidence customers need to have in businesses with a Web presence has started to “rot from the inside out.”

Senator Wyden said that while he believed some government surveillance was necessary, he agreed there was a need to make changes to existing US laws in an effort to rebuild the trust of the American people and governments around the world.

Acknowledging that there was a real threat to the digital economy, Wyden promised to do his best to persuade lawmakers to take the necessary action, which includes imposing strict controls on the NSA, to save it from further damage.