When the US Federal Trade Commission slapped a fine of $22.5m on the search giant Google last week, it was easy to dismiss as relatively insignificant against a worldwide profit of nearly $3bn. But it marks an important point in a shift in perceptions of Google, once seen as a paragon of internet virtue.
It’s easy to forget the extent to which Google’s Larry Page and Sergey Brin were once seen as good guys. The pair met and began work on their search engine in 1995, but refused to participate in the dotcom mania which was making their peers rich on the back of half-baked ideas and hype.
While others cashed in by floating prematurely on the stock market, they kept a low profile and built something profound: a complex, accurate, essentially democratic search engine which helped shrink the world as dramatically as had the compass, the telegraph and the aeroplane. Capable of indexing knowledge in a manner accessible to all, “Googling” caught on fast and the company became a byword for subtle ingenuity. We take this for granted now, but at the time it was mind-blowing, brilliant, and free.
Yet this was just the beginning. At the “Googleplex” in Mountain View, California, Page and Brin tried to create an anti-corporate, open culture, based on trust and equality, where everyone shared the same office space and pets could come to work. Indeed, the pair distilled their ideas into a guiding principle which, while vague, was sincere: “Don’t be evil.” Strange how, with a slight change in inflection, the phrase can be made to sound Orwellian.
Even when Google’s founders took their company public in 2004, they were trying to do the right thing. The quirky Dutch auction system they used was designed to hold Google’s share price at a sustainable level and avoid being gamed by the Wall Street investment banks whose actions – still little understood – had wiped out most of their youthful competitors in the dotcom sector four years earlier. The pair, along with CEO Eric Schmidt, also limited shareholders’ influence and refused to issue quarterly forecasts in an attempt to avoid short-termism.
Last week’s fine is the largest the FTC has yet levied. Google was judged to have misled users of Apple devices as to the efficacy of the privacy protection settings on Safari browsers, enabling search history to be tracked and logged. On the back of the corporation’s recent admission that it had failed to erase personal data collected illegally by its Street View in 2008 (not to mention the usual revelations about paltry contributions to the exchequer in the UK), August may be the month in which Google’s astonishing slide from the light to the dark side in the eyes of the public becomes irreversible. Examine their problems in the round, though, and a pattern appears – one which we need to understand if we’re to make sense of the world we’re creating.
When Google was incorporated in 1998, Page and Brin thought profit would come from licensing their technology to other companies. But in 2000 they became the first people to make online advertising pay, by tearing up the old rulebook. The AdWords system worked by charging advertisers according to how many people clicked through to their website upon being presented with Google search results. Most of the company’s profit now accrues in this way.
Here’s the thing, though. If an entity such as Google were free to log and analyse our specific habits and proclivities as revealed in search history, social networking and email, it would be able to sell ads targeted tightly at us, with a greater chance of success and incalculably greater value. If Google is wealthy and powerful now, imagine how much wealthier and more powerful it – or, chillingly for them, someone else – could be if armed with this extra information.
Last week’s fine was directed specifically at Google’s advertising arm, DoubleClick, which began as one of the first and most storied internet businesses in New York, prior to being snapped up by Google after the tech sector crash of 2000. When, back in 1998, the company’s founding CEO Kevin Ryan declared that “personal information is the oil of the 21st century”, very few people understood. But we’re beginning to get it now. The battle lines have been drawn.
Andrew Smith is the author of Moondust: in Search of the Men Who Fell to Earth and What I Tell You Three Times is True: the Incredible Wired World of Joshua Harris.