Ken Auletta - Googled - The End of the World as We Know It

By the end of 2007, it was apparent that privacy issues were gaining traction, spurred by a crescendo of news stories about real or potential invasions of privacy. Many were chilled when President Bush declared that under the Patriot Act he did not need judicial or congressional approval to wiretap the phones of anyone the executive branch suspected of consorting with, or knowing, alleged terrorists. It was revealed that telephone companies, at the request of the Bush administration but without court approval, turned over oceans of data concerning the phone calls and e-mails of individuals.

There is often an inherent conflict between privacy and Google’s belief that data is virtuous. Eric Schmidt, as we’ve seen, said that the more Google knows about a user, the better the search results. His and the founders’ ideal? For Google to know enough to be able to anticipate the user’s true intent in a search query, eventually getting to the point where Google could improve the user’s experience by supplying a single answer to a question. Better targeted ads, Google believes, serve the consumer as well as the advertiser. In an October conference call with analysts to discuss Google’s third quarter and its new products, Schmidt said, “We’re working on expanding our breadth of ads, offering all sorts of new types of ads-gadget ads, video ads, others coming. And each of these initiatives gives advertisers new and interesting ways to build relationships with their customers. So by building these deeper ad solutions, we really can deliver more value.” More “types of ads” equals more data, which equals more assistance to advertisers, which can be a service to consumers, but also an invitation to nibble at privacy constraints. Schmidt insists Google would never risk violating user privacy because Google’s success pivots on user trust. Rotenberg counters, “If people knew what Google was doing, they’d lose trust.”

In a voice as steady as a dial tone, Schmidt said Google users can click to “opt out” of allowing Google to track its cookies by clicking on the Privacy choice on the Google home page and following the instructions, a feature most users are probably not aware of or have a difficult time finding. Rotenberg, Chester, and others say that instead, Google should allow users to opt in, meaning that they would have to actively volunteer their cookies. That would be a mistake, Schmidt said, because the quality of a Google search would be inferior if it stored none of the cookie data; that’s what helps Google better answer a search question. Without information about the user, Google would not be able to narrow search results based on prior searches. Without a cookie, an American living in Paris would receive search results in French, not English. Schmidt disputes the notion that advertisers have become as important to Google as the user, reciting the company’s official first two principles: One is “the quality of the search as seen by the end user. The second one is the quality of the ads as seen by the end users, not by the advertisers.”

When asked why consumers should trust that Google would not abuse the private data it collects, Sergey Brin in 2007 told me that the fears people have are tied to a distaste for advertising and to a fear of Big Brother, which is sometimes “irrational.” He wondered: “How many people yesterday do you think had embarrassing information about them exposed as the result of some cookie? Zero. It never happens. Yet I’m sure thousands of people had their mail stolen yesterday… I do think it boils down to irrational fears that all of a sudden we’d do evil things.”

Irrational or not, Google was assailed from many sides and compelled to play an unaccustomed role: defense. Nick Grouf, CEO of Spot Runner, an advertising/marketing agency that counted among its investors Martin Sorrell’s WPP Group, believed Google was engaged in too many battles. He said that traditional media woke up to the Google threat not when the company did its IPO or was sued by book publishers, but when it bought YouTube. “When you pay $1.6 billion for a site that is on the cover of every newspaper and magazine, and is the centerpiece of the zeitgeist as the future of media”-suddenly Google was widely perceived as a media company. By 2006 and into 2007, Grouf said, Google was battling with television and newspapers and book publishers and Microsoft and eBay and advertising agencies. “It’s hard to compete on all fronts. And people start to whisper: ‘These guys have gargantuan ambitions.’”

IN NOVEMBER, the FTC held a two-day town hall meeting on privacy, a series of tame panel discussions that became more a seminar than an inquisition, disappointing Jeff Chester. The commission decided that the often-baffling issue of privacy would be excluded from the decision of whether to approve Google’s acquisition of DoubleClick. The focus, instead, was on whether the marriage was anticompetitive. It was difficult to argue that the merger harmed competition when, within months, companies such as Microsoft and Yahoo and AOL and the WPP all acquired digital advertising companies of their own. The FTC prefers “to wait for a violation before we act,” an agency official said on the eve of the approval of the merger. The EU did compel Google to make concessions and to tighten its privacy policies, but it, too, would approve the merger.

By mid 2007, Google was worried about the many restive bears it had provoked. It began to reach out to Washington. To allay privacy concerns, the company announced that it would reduce from two years to eighteen months the information it keeps in its database about the Web search histories of its users. Claiming that privacy laws were out of date, Google put out a press release proposing uniform international privacy rules and perhaps laws that recognized how the Internet and technology posed new privacy challenges. Instead of one “uber cookie” that permanently tracks a user, Google said it was experimenting with “crumbled cookies” that would disappear over time.

The public battles probably made Google’s executives somewhat wiser. Google was only guilty, they believed, of naivete, not arrogance. “The product brand was very strong,” said Alan Davidson, Google’s senior director of government relations and public policy, who is a computer scientist as well as a lawyer and who oversees Google’s Washington office. “The political brand was very weak. Because we were not here to define it, it was being defined by our enemies.” He paused a moment, and added, “Enemy is a strong word. It was being defined by our competitors.” Gigi Sohn, the president and cofounder of Public Knowledge, a nonprofit organization that lobbies for both an open Internet and more balanced copyright laws, said that like many Silicon Valley companies, Google chose to have a smaller presence in the nation’s capital. But Google was more extreme, she said. “They were almost alone among Silicon Valley companies in failing to recognize that you have to play in the sandbox. If you want progressive spectrum policies, the free market does not ensure that.”

Google’s one-man operation in Washington expanded in 2007 to include twenty-two staffers. Among them were Jane Horvath, a former senior privacy attorney in the Bush administration’s Justice Department; Johanna Shelton, former senior counsel to Democrat John Dingell, then chairman of the House Energy and Commerce Committee; Robert Boorstin, a former speechwriter for President Bill Clinton; and Pablo Chavez, former chief counsel to Republican senator John McCain. To advance its Washington agenda, Google had established its own PAC (NETPAC), and soon hired three outside firms to lobby on its behalf: the mostly Democratic Podesta Group; King amp; Spalding, where Google relied on former Republican senators Connie Mack and Dan Coats; and Brownstein Hyatt Farber Schreck, which had recently hired Makan Delrahim, a former deputy assistant attorney general who’d been in charge of the Antitrust Division in the administration of George W Bush. “We’ve been under the radar, if you will, with government and certain industries,” observed David Drummond, the Google senior vice president who oversees all of the company’s legal affairs and policy interaction with governments. “As we’ve grown, we’re engaging a lot more.”