Sign up for a daily newsletter defining what matters in business and markets

Stories

Google's new emphasis: privacy

Google's Sundar Pichai speaking at their developer conference Tuesday
Google CEO Sundar Pichai, speaking at I/0 2019 on Tuesday. Photo: Google

Tuesday's Google I/O keynote paraded the usual new hardware and software, but the biggest development was the emphasis on privacy that the company wove through each of its rollouts.

Why it matters: The move is, of course, timely: In the wake of scandals and data spills, all Big Tech is talking privacy, even if individual companies have very different agendas. And Google is the company that basically invented the monetization of user information, unlocking the secret to minting billions online by targeting ads based on user data.

The big question: Is Google really making a fundamental shift — or is it just applying window dressing.

Details: Google's privacy moves include...

  • New limits on advertiser tracking in the Chrome browser.
  • New tools for users to control or remove their data.
  • Fresh commitments from Google on how its growing hardware empire would use and store data.
  • Find more specifics here.

Between the lines: The conventional wisdom is that Google wants and needs all the data it can get because the ads that fuel its profits depend on that data. In other words, Google would need to upend its business model to offer significantly more privacy.

Executives insist this isn't the case. The really valuable data, they say, comes from knowing what a user is looking for and where they are at any given moment. That's far more relevant to advertisers than the vast troves of historical and demographic data that Google has amassed over the years.

Our thought bubble: Giving Google the benefit of the doubt doesn't mean assuming that it's acting purely out of altruism. If its business is advertising, especially search, it needs to make sure that consumers trust Google enough to use the products that generate its core revenue.

  • Today, that's still heavily concentrated on PCs and phones via search and the web.
  • But the queries of the future will come in many forms — through voice commands and via cameras — and on many more devices.

Yes, but:

  • Features and commitments are a start, but only time will tell just how much privacy Google is really committed to.
  • Google is a big company with many moving parts, and even if its overall direction is toward greater privacy, there are bound to be some slip-ups and backslides.
  • Perhaps most importantly, Google can also afford to collect less data on users because the power of machine learning will allow it to infer more about them.

We've already seen an example of this when Google stopped scanning your Gmail to serve advertising.

  • It didn't do so because it suddenly decided the practice was creepy or obtrusive.
  • Instead, it turned out that there's other information the company knew about Gmail users that was more valuable for targeting ads than the contents of your inbox.

What they're saying: Google, like Facebook, argues that there's a reasonable and valuable tradeoff between the data users provide and the free services they get.

  • In a New York Times essay Tuesday, Google CEO Sundar Pichai wrote, "A small subset of data helps serve ads that are relevant and that provide the revenue that keeps Google products free and accessible."
  • In a riposte to Apple's Tim Cook, who has argued that customers choose Apple's higher-cost devices in part because they trust Apple to keep their data private, Pichai added, "Privacy cannot be a luxury good offered only to people who can afford to buy premium products and services. Privacy must be equally available to everyone in the world."