Google’s recent troubles give an insight into how much and why privacy matters

By February 28, 2012 10 Comments

Danny Sulliivan put up a good post yesterday: On Google & Being “Evil”. His main point was that Google is now a very big company and that inevitably means they will make mistakes, including ones which impact their users’ privacy, but they are not any more evil (or good) than any other large company. I agree with that, they are becoming no different to other large vertically integrated service providers like Facebook and Apple. As Danny points out, there is one important historical difference though, and that is Google’s “Do no evil positioning”, which gives the worlds largest search engine much further to fall than its competitors.

Danny’s main point is interesting, but it is his description of Google’s recent problems and the government and public response to them which I am going to focus on today.

Let’s start with a recap on what Google has done.

Most importantly they are changing their privacy policies. If you use any Google services you will have seen a pop-up informing you of this fact, and if you are anything like me you will have seen so many pop-ups that you have started to get annoyed by them. Also, if you are anything like me (and 90% of the rest of the population) you won’t have read them, but you will have caught sight of various headlines suggesting that you should be worried about what these changes mean.

Beyond the privacy changes Google has made a few gaffs recently. Danny lists three:

The response to this has been markedly different in different parts of society. On the one hand politicians, journalists and the intelligentsia are outraged, whilst on the other hand the public doesn’t seem to care. The picture at the end of this post shows the top results on a Google News search for “Google privacy policy changes”. The negativity is clear for all to see. Yet Danny Sullivan reports that for the mass public:

there’s no mass movement to abandon Google. Take a tour of its help forums, as I’ve explained before. [Privacy] It’s not a huge topic.

I’ve been having an increasing number of conversations in recent weeks with folk (largely educated, wealthy, middle aged folk) who think that a privacy backlash is coming, but I just don’t see it. Further, when I press these folks on what the precise issue is, or what might precipitate a sudden elevation of this issue in the mind of Joe Public they have no answers.

However, politicians are now legislating for privacy and companies have to deal with that. The important thing to note though is that it is a regulatory issue, not a product issue. Hence internet companies need to deal with privacy issues in the same way as financial services companies have dealt with regulators for years. They need to lobby to make sure they don’t get blind-sided, and many will try to use regulation for competitive advantage.

I was at a dinner for our portfolio company StrikeAd last night. They operate in the mobile advertising industry where everybody is very concerned about the privacy implications of targeting and tracking users. As a result voluntary codes of conduct are being drawn up, they are being endorsed by standards bodies, and those bodies are then certifying vendors as compliant, and listing service providers as qualified to provide certification. If you want to play in certain segments of the market, for example ad verification, then you need to play the game and make sure you are on the list of vendors qualified to provide certification. In other words, for companies in this market lobbying and being part of the regulatory process is as important as it is for banks and telcos.

Privacy is important, and users need to be protected, but as you can see from the story in the paragraph above a lot is being done already to prevent abuse of personal data. I think we will see more regulation in this area and companies will devote increasing resources to making sure personal data is protected and only used in the right ways, but I see no evidence that the greater public cares enough that we will see anything more than that.


Enhanced by Zemanta