Yes, the web has become a world of its own and just like the physical world the NSA, CIA and intelligence agencies from all over the world will find a way to get intelligence. People complained in the 60's, 70's, 80's etc and a way to gather intelligence was found both legal and illegal. This is not a Silicon Valley thing,this is the race to be the most effective at gathering intelligence in this new world. This is why China, Russia and so on are so involved in hacking and other activities. Look at history, the US will not allow themselves to be left behind in this arms race, there are so many other strategic battles being fought besides terrorism that having an edge on intelligence in the virtual world is something that most of the power countries are gunning for.

I do think there have been some internal struggles in the Valley, though I agree that the idealists have never really been in charge of the companies.

A simplified factional map might involve the "techies", the "suits", and the "apolitical pragmatists", with various shifting alliances between them. The early internet, for example, seems to have been largely dominated by ideologically pro-openness techies, working in a period where their bosses didn't interfere much. It's interesting to read Jon Postel's public emails, for example, and imagine if anyone in a similar position could fulfill his role with the same integrity today.

It's marketing, friend, nothing personal. Just trying to make some money. You know. It's the 'murican way! No principles, just winning and money.