Epicenter Mind Our Tech Business Word War III: Google vs. Governments

In how many ways did Google respond to this week’s letter (PDF) from the data protection authorities of nine countries criticizing the company’s approach to privacy?

The first response came in the form of a statement from Google’s official PR operation.

Predictably, it was blander than bland. “We try very hard to be upfront about the data we collect, and how we use it,” the statement suggested. “Of course we do not get everything 100 percent right — that is why we acted so quickly on [Google] Buzz.”

This is the happy-clappy voice of Google’s PR operation, a vast exercise in passive aggression designed to prop up the perception that Eric, Larry and Sergey really, really, really, don’t want to do evil.

Much more interesting was the verbal assessment a PR representative offered up to the Wall Street Journal.

“We have discussed all these issues publicly many times before and have nothing to add to the letter,” the spokesperson told the Journal.

Here, I think we’re getting closer to what Google really feels. The tone is tetchy. The underlying message is clear: Google would like the letter’s signatories to go forth and multiply.

Yet this response is also a problem for Google. The letter it received was signed by data protection bureaucrats in Canada, France, Germany, Israel, Italy, Ireland, the Netherlands, New Zealand, Spain and the UK.

You’ll notice that the US isn’t on the list. So ask yourself how the spokesperson who talked to the Journal would have responded if the US had been among the signatories.

Would she have taken the time to discuss “all these issues” once again? You bet she would. Would she have suggested that responding to the letter was pointless? I doubt it.

At this point, it’s fairly obvious that that Google has made at least three mistakes.

First, there’s the use of corporate weasel words in the original statement. When Google uses this voice to talk about important issues, it sounds just like most other large companies. The desire to disagree with something without provoking an equal and opposite reaction is a very specific form of corporate cowardice. My sense is that Google — as it grows larger — is starting to do this more often.

Next, there’s the US-centric view of the world that leads a spokeswoman to dismiss the letter during a discussion with the Wall Street Journal.

Google is not immune to the deep parochialism of Silicon Valley. Yet this is a company that generates over half of its revenues outside the U.S.

On this basis, it’s surely madness to dismiss the arguments of nine states whose representatives are deeply dissatisfied with Google’s position on privacy.

If you doubt this, listen to the supporting commentary offered by Jacob Kohnstamm, the chairman of the European Commission’s Article 29 working party on data protection. The letter, Kohnstamm told journalists, represents a “last warning to the online world”.

Finally, there’s the tedium-filled hope that the awkward squad will simply shut up and go away.

This, of course, will not happen. In the end, Google will become a regulated quasi-utility. It’s easy to suggest why this should happen, but profoundly difficult to imagine how. Yet where there’s a will, the political elites will eventually find a way.

The key challenge for Google involves slowing down the process. Arguably, this now matters more to shareholders than new product development. Regulated companies make smaller profits than you’d otherwise expect. For a company whose shares still trade at 25 times earnings, this is a fate to be avoided.

In this respect, Google has generally performed well so far. Unlike Microsoft in the 1990s, the company hasn’t allowed indignation to tip over into public aggression toward its opponents.

In no small part, I suspect that this is attributable to Eric Schmidt, who witnessed Microsoft’s fatal weakness for confrontation at close quarters as the chief executive of Novell and CTO of Sun Microsystems during the 1990s.

When dealing with critics in public, Schmidt frequently behaves as if he has listened to their complaints. This is a habit that Bill Gates never acquired.

Schmidt also delivers bullshit with aplomb. When he announced the launch of Fast Flip, he made it sound like the future of news. Clearly, it wasn’t. Yet tokens like these slow down the pursuing pack, sowing division among the ranks.

Subtlety comes naturally to Schmidt. Asked to respond to the latest of Rupert Murdoch’s copyright tirades a few weeks ago, Schmidt remarked dryly that it’s best to look at Rupert’s comments “in context of a business negotiation”.

This response worked well, combining economic rationalism with a tease for the assembled journalists and criticism of Murdoch’s vaudeville style.

In many ways, it’s a shame that Schmidt can’t be seconded to run Google’s PR operation. Arguably, he’d add more value to the company in this role.

This week, for example, Schmidt would probably have drawn attention to what I initially fancied to be Google’s third response to the privacy broadside it received on Monday.

On Google’s corporate pages this week, there was no missing the news about the Government Requests Tool, a new initiative from the office of David Drummond, the company’s top lawyer.

Among other things, the Requests Tool clarifies how frequently governments ask Google to hand over users’ personal data (mostly to assist with law enforcement investigations). The results can be interpreted as an index of governmental willingness to invade privacy.

Here’s the league table for the period between July and December last year in the case of signatories to Tuesday’s letter:

UK 3rd 1,166 requests

France 5th 846 requests

Italy 6th 550 requests

Germany 7th 458 requests

Spain 8th 324 requests

The Netherlands 13th 67 requests

Canada 19th 41 requests

Israel 20th 30 requests

The connection between these rankings and the letter from data protection bureaucrats is clear. Eight of the nine governments that complain so vociferously about Google’s privacy policies also appear on this list of governments who take a keen interest in their citizen’s private communications.

The point is worth arguing. Governments might be keen on regulating Google, but they also represent a huge threat to privacy in their own right. Google itself acts as a restraining influence on their behaviour. This week, the company confirmed that it sometimes “refuses to produce information” or “tries to narrow” the requests for data made by governments.

If Eric Schmidt had been running Google’s PR operation, I suspect he would have used this league table as a riposte to the privacy commissioners.

But he isn’t, and it wasn’t. The fact that the privacy letter and Drummond’s tool became news stories on the same day appears to have been coincidence.

We know this because the ham-fisted spokeswoman who talked to the Wall Street Journal described the timing as “ironic”.

The best PR operators grab passing circumstances and impose order upon them. This week, Google failed to do either.