Google killing online privacy, choice

A few years after it was founded, Google adopted a list of guiding principles it titled, "Ten things we know to be true." No.4 was "Democracy on the web works."

That's a worthy sentiment - though a bit surprising coming from the web's emperor.

For that, arguably, is what Google has become. Its search engine accounts for nearly 80 per cent of all web searches in the United States - and a remarkable 98 per cent of searches from mobile devices. In that role, Google is not just an eponymous verb but perhaps the most central conduit of information in the nation - and, indeed, on the planet. No other search engine comes close.
News accounts suggest that the Federal Trade Commission will delay any decision on whether to file an antitrust lawsuit against Google until perhaps next year. That decision had been expected to come this week.

The FTC has spent nearly two years investigating whether Google's search engine favors the company's own commercial endeavors over rival offerings, thereby stifling competition. And even now, some analysts believe that the commission might forgo any legal action against the company in exchange for Google's willingness to make some modest changes in the way it uses certain consumer information.

This would be a severe setback for internet users. It will allow Google to continue to amass unbridled control over data gathering, with grave consequences for privacy and for consumer choice. (European regulators are conducting their own antitrust inquiry into Google.)

Google has been modest about its dominance in the modern information society, asserting that competing search engines, like Yahoo or Microsoft's Bing, are just "one click away" if people wish to use them. The internet is an extraordinarily complex domain with equally powerful challengers, the company points out. Facebook makes Google's own social media platform look like a joke. Far more shoppers begin their online product searches through Amazon than Google. In short, there's enough competition out there, Google says, that consumers ought not to fear the company's mighty role in the information economy.

But we need to look at Google's market role - and behavior - through a different prism. Google is not just a "search engine company," or an "online services company," or a publisher, or an advertising platform. At its core, it's a data collection company.

Its "market" is data by, from and about consumers - you, that is. And in that realm, its role is so dominant as to be overwhelming, and scary. Data is the engine of online markets and has become, indeed, a new asset class.

In March, when Google replaced the more than 60 privacy guidelines that governed its products and services with a single policy, it also moved to consolidate the personal data it collects. The company creates as much data in two days - roughly 5 exabytes - as the world produced from the dawn of humanity until 2003, according to a 2010 statement by Eric Schmidt, the company's chairman, who later declared that he didn't "believe society understands what happens when everything is available, knowable, and recorded by everyone all the time."

For now, Google uses the data to sell targeted ads, but who says the company's use of the data will be restricted to that purpose? Opt out of Google's data collection? Sure, you can do that - but you'll also have to delete your Gmail account and leave Google's ecosystem. With Google's Android operating system - which is activated in 1.3 million new mobile devices every day, and is used by more people than use Apple's iPhone - that ecosystem is growing.

I've been concerned about Google's dominant role in data collection - and the profound privacy concerns it raises - since my time at the FTC When the commission approved Google's 2007 acquisition of DoubleClick, I dissented - because I was concerned that combining the two companies' vast troves of consumer information would allow Google, which was largely unchecked by competition, to develop invasive profiles of individuals' Internet habits.

Now, the FTC has another chance to protect consumers, promote innovation and ensure fair competition online. In making its decision, it must understand that while Google may be the runaway leader in Web search and online advertising, its most troubling dominance is in the marketplace of private consumer data. If real competition in this area can be restored, I am confident that market forces will provide the incentives necessary for companies to offer attractive services and relevant, engaging ads without violating consumer privacy.

I am no longer an FTC commissioner, but a lawyer representing companies - including Microsoft- that are concerned about Google's power as a data collector. Yes, there's some irony in that - it wasn't long ago that Microsoft faced its own major antitrust lawsuit and had to change its anticompetitive practices.

But then, an emperor is an emperor. And when it comes to the web, as Google's wise founders said, democracy works best.