Google's reputation is, after all, based on "do no evil", is it not? Hundreds of millions of people all over the world trusted them to ethically handle ads and personal data and all that. Google took a principled stand on Chinese spying and censorship, remember, and it cost them probably billions of dollars in business in mainland China.
A reputation, once lost, is not easily restored.
And don't be naive. The judges are in my pocket, public opinion is in my pocket, I have power which your money can never buy and you are on your own, as all of your competitors are just waiting for the chance to jump in and destroy you.
It is not immediately clear the stakes are that high, and a counterargument with some validity is that a failure to cooperate will cost a lot of lives from future mass causality terrorist actions. And the penalty is squalid, e.g. see the example of Federal prisoner Joseph Nacchio, former CEO of Qwest. Note the truth behind his conviction doesn't matter a long as there is enough solid suspicion.
But the real catastrophe here is that these U.S. companies have suddenly and irrevocably lost the trust of the rest of the world, as the article rightly points out. Software is one of America's last bastions of competitiveness and our stupid government has managed to undermine even that.
So long, Internet. It was fun while it lasted. I just hope there will still be a few good paying jobs left after the crash, maybe in the field of cryptographic communications; that seems like it's got a lot of potential in our post-privacy era.