Recent terrorist attacks and resulting questions about the limits of surveillance have rekindled debate about how governments should deal with the challenges of powerful, commercially available encryption. With active debate in the United States and Western Europe surrounding this issue, it is instructive to note that Israel has been regulating encryption for decades.
Israel is an interesting case study in this field because its successful high-tech encryption and cyber entrepreneurism flourishes amidst perpetual internal and external national security threats and the extensive associated surveillance needs. For perspective, companies in Israel, a country comprising less than 0.11% of the world’s population, are estimated to have sold 10% ($6 billion out of $60 billion) of global encryption and cyber technologies for 2014. Domestically, this figure surpassed the aggregate value of defense contracts signed by Israel’s government last year.