Online Privacy

Google often acts as if it thinks it is above the law. That may be the most plausible explanation for why Google is under antitrust investigation on five continents, has had 35+ privacy scandals, and has been sued for eight different kinds of infringement/theft from most every content industry.

I. Cover-ups

Memo: To All Google Spokespeople

From: Brandi Sparkles & the Privacy Excuse Algorithm Team (PEAT)

RE: The New Google Public Line on FTC/State/EU Privacy Investigations

Google has changed the company's public line concerning our inadvertent, unintentional, un-anticipatable, accidental, unexpected, unwitting, un-premeditated, unconscious, and totally innocent bypassing of Apple Safari browser's privacy protections, which was first reported by the Wall Street Journal February 19^th, and which is now being investigated by the FTC, State Attorneys General, and the EU per the WSJ today.

See my Daily Caller Op-Ed: "EU Filling FTC Void of Google Law Enforcement."

The evidence is mounting that the European Union is stepping in to fill the void of FTC law enforcement concerning Google. Currently, EU law enforcement is confronting Google on at least three different major law enforcement matters, and in the U.S., the DOJ, State Attorneys General, and Congressional overseers have taken a consistent, bipartisan tough law enforcement approach with Google. However, this is in stark contrast to the FTC's consistently lax law enforcement record with Google.

For the full story and evidence click here.

Count me as totally perplexed how the supposedly-security-minded U.S. State Department could decide to adopt security-challenged Google's Chrome browser for worldwide use by the State Department. What are they thinking?

Chrome is a consumer-grade, ad-supported, tracking-driven browser. By design Chrome has an advertising default omni-tracking capability inappropriate for Federal Government secret classified work. For the first time only last week, Google begrudgingly committed to offering a voluntary do-not-track capability for Chrome by the end of 2012 as part of the White House brokered Online Privacy Bill of Rights. However, will Google respect the State Department's right to secrecy? That's a very fair question given that…

Since Privacy International ranked Google worst in the world for Privacy in its 2007 privacy survey for its unique “comprehensive consumer surveillance & entrenched hostility to privacy,” Google has had at least 24 more public scandals/controversies over privacy/security.

(Note: The text in quotations are verbatim quotes from Google via a Politico post. The italics in [ ] is a satirical translation of what Google really is saying.)

“Google’s Rachel Whetstone, senior vice president for Communications and Public Policy issued the following statement to POLITICO regarding a WSJ report that the company has been bypassing the privacy settings of Apple's Web browser on iPhones and computers:”

“The Journal mischaracterizes what happened and why.”

• [Translation: What we really did is we hacked Apple. In an open Internet Apple has no right to use a walled garden to protect Apple users’ privacy from Google's omnipresent tracking. We hacked Apple to liberate private data that users and Apple were withholding from the world.]

“We used known Safari functionality to provide features that signed-in Google users had enabled.”

Google is battling law enforcement in the U.S. and around the world on three different legal battlefronts: antitrust, privacy and property. Why is it only Google that is under serious law enforcement investigation for so many different serious infractions in so many countries around the world? According to a top Google lawyer, “Google’s leadership does not care terribly much about precedent or law” per Stephen Levy’s book In The Plex. That very rare scofflaw attitude, combined with the vast amount of evidence cataloged below, strongly suggests Google is not the innocent victim it claims to be, but a dominant perpetrator of systematic violations of law around the globe.

Only Google is battling law enforcement around the globe with the defiant stance that:

Why are market forces so weak in protecting users’ online privacy?

The main reason is that the online marketplace is economically structured around users being a commodity, data, to be aggregated and mined, not customers to be served and protected in a competitive marketplace. That’s because the overriding economic force that created the free and open commercial Internet – the predominant Silicon Valley venture capital/IPO value creation model – was and remains largely antithetical to protecting online privacy.

The Silicon Valley venture capital/IPO driven model is laser-focused on achieving Internet audience/user scale fastest in order to gain first-mover advantage and then rapid dominance of a new product or service segment. This predominant Internet economic model is predicated on a precious few investments achieving such rapid user scale that it: warrants a buy-out at an enormous premium multiple; enables fast and exceptionally-profitable liquidity (via the new secondary derivative market for private venture shares or employee options); or broad liquidity via a public IPO.

What is the essential critical element of achieving audience/user scale fastest? Free. No direct cost to the user fuels fastest, frictionless, viral adoption. This free economic model presupposes online advertising as an eventual monetization mechanism and shuns products and services directly paid for by the user because their inherent time-to-market is too slow and their upfront sunk cost of sales and customer service is too high for this predominant value creation model.

Reports that “Twitter Can Censor by Country” is a perfect example of how the world is changing the Internet. Change is a two-way street. Conventional wisdom that only assumes the Internet is changing the world risks being blind-sided by the Internet’s underappreciated exa-trend: how the world is changing the Internet.

See my Forbes Tech Capitalist post: "Twitter Realpolitik & the Sovereignization of the Internet" to learn about Twitter's new realpolitik and how sovereign powers will increasingly be asserting themselves vis a vis the Internet.