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March 30, 2011 7:11 pm
Google has pledged a raft of measures to improve the protection of the privacy of its users, including external audits of its handling of personal data for 20 years, under a landmark settlement with the US trade regulator.
The internet company has also promised to obtain consumer consent for any increased sharing of data collected from its consumers and to study the protection of it.
Analysts said the settlement with the US Federal Trade Commission of a complaint raised over the launch of a social networking service called Google Buzz was the most significant struck by the regulator with an internet company and could set a precedent for another inquiry into Facebook.
The February 2010 launch of Google Buzz made public the names of frequent Google e-mail correspondents. In particular, it exposed clients of mental health professionals, clients of attorneys and children, according to a formal FTC complaint filed along with the settlement on Wednesday. While the deal is only binding on Google, experts said the language in the documents made it clear that the FTC will hold companies accountable for failing to live up to their stated privacy policies.
Among Google’s biggest problems was that the Silicon Valley powerhouse had pledged that consumers would be asked for permission if the company began sharing the information they provided in new ways.
In fact, “the set-up process for Gmail users who enrolled in Buzz did not adequately communicate that certain previously private information would be shared publicly by default”, the regulators wrote in their complaint.
Potentially greater impact stems from the implication that companies that change their procedures must get explicit approval from users.
The non-profit Electronic Privacy Information Center, which triggered the investigation, has also complained about Facebook’s privacy settings.
“It is a very significant settlement – probably the most important FTC settlement on privacy to date”, said EPIC executive director Marc Rotenberg. “The Facebook decision is still pending. That is the next decision to watch for.” Facebook did not immediately respond to a request for comment.
Google quickly backtracked on its Buzz practices after many consumer complaints. An official wrote on the company blog that staffers are “100 per cent focused on ensuring that our new privacy procedures effectively protect the interests of all our users”.
No financial penalties are involved in the FTC settlement, but it increases Google’s legal risk should it fail to get consent or break privacy pledges.
Unlike past settlements, such as that between the FTC and Microsoft over its Passport sign-on service, Google’s resolution applies to all of its offerings, including search and advertising.
Online privacy is an increasing subject of concern for the general public and lawmakers, who are contemplating a number of measures including a proposed privacy “bill of rights” in the US.
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