So everyone's business has to change to meet the most restrictive country's laws? What next, the internet is ruled by sharia law? I guess thats what happens when global companies become the only choice, no matter what your country allows, we have to do what Elbonia wants.
The US isn't exactly the open country many pretend it to be. The primary difference seems to me, many countries openly declare they want the data, the US just does it anyway, denying it until caught.
Companies must balance the needs to customers versus doing business at all in some countries. Do they forgo the revenue because in some areas people are offended? Do they forgo revenue and fire their local workers to appease groups in other countries? As in, where does the process stop? Who is more right?
They generally won't apply laws of country A in country B - it's just that if they want to do business in A they have to follow laws of A in their operations in A.
Profit-oriented organizations will comply rather than leave the country, unless it would lose them more business elsewhere. For this reason (among others), commercial-ware and commercial services are categorically untrustable.
