“Twenty years ago, a large technology firm was setting the world on fire,” Google Executive Chairman Eric Schmidt said in Senate testimony last year. “Its software was on nearly every computer. Its name was synonymous with innovation. But that company lost sight of what mattered. Then Washington stepped in.
“In the years since, many of us in Silicon Valley have absorbed the lessons of that era.”
Privacy concerns have followed Google and other Internet companies for years, especially as they have moved into Europe, where laws are stricter. Google’s Street View program, in which cars equipped with cameras took pictures of street-level scenes, has provoked outrage in Germany and some other countries. The controversy was made worse when investigations revealed that the cars also collected personal information from unsecured WiFi signals; the company said that was done in error and apologized.
The company says that such tracking allows it to serve more relevant ads; a visitor to golfing sites, for example, might see ads for balls, clubs or golfing-themed resorts. Privacy advocates, however, have warned about the volume and precision of data Google is compiling on people worldwide.
The case is unlikely to have an immediate effect on users beyond Europe, though regulators elsewhere could ask Google to make similar changes. U.S. lawmakers have expressed concern about the company’s policy.
Resolving antitrust issues will probably be more difficult. Google has been negotiating with the European Union’s chief antitrust official, Joaquin Almunia, for months.
He has detailed four possible areas of violations, with the most serious being allegations that Google organizes its search results in a way that highlights its own offerings and penalizes those of rivals.
Staffers at the U.S. Federal Trade Commission, meanwhile, have circulated a draft recommendation of a possible lawsuit against Google over alleged antitrust violations. The letter includes evidence such as internal company e-mails, said a person familiar with the investigation who spoke on the condition of anonymity.
The FTC has declined comment on the case.
Several people familiar with the thinking of commissioners say a majority of the commission, including Chairman Jon Leibowitz, has significant concerns about Google’s behavior. A decision is expected before the end of the year, though few observers expect action ahead of the presidential election.
The antitrust investigation already is generating political attention. Rep. Jared Polis (D-Colo.), who has a background in the technology industry, sent a letter to Leibowitz last week discouraging the FTC from suing Google, on the grounds that the marketplace remains open to competitors.
“This is a dynamic marketplace, one in which competition exists every day,” Polis said in an interview Monday. “Today’s leader can be tomorrow’s also-ran.”