2012-08-10

$22 million fine for Google

2010, Google set up a social networking service called Buzz that exposed people's email contacts. Following an FTC investigation, Google agreed to 20 years of oversight and a pledge not to mislead consumers about privacy issues. That's the pledge that the FTC says Google broke with Safari.

Google also got in trouble for collecting personal data transmitted over unprotected Wi-Fi networks as Google cars cruised neighborhoods around the world taking pictures for the company's online mapping service.

The FTC didn't take action against Google for scooping up the Wi-Fi data, although the Federal Communications Commission fined the company $25,000 earlier this year for impeding its investigation into the matter.

As it did with the secret tracking on Safari, Google has framed those privacy breaches as inadvertent slips.

That defense is wearing thin, according to David Vladeck, the director of the FTC's bureau of consumer protection.

"In some ways, as a regulator, it's hard to know which answer is worst: 'I didn't know' or 'I did it deliberately.' Both are bad," Vladeck told reporters on a Thursday conference call.

The FTC hopes the fine will force Google to pay better attention to its practices.

"It's a big company," Vladeck said. "It's grown very quickly, but the social contract is if you are going to hold on to people's most private data, you have got to do a better job of honoring your privacy commitment."

Those terse remarks underscore Google's increasingly tense relationship with regulators around the world. Both the FTC and the European Commission are engaged in broad antitrust investigations of Google. The company, which is based in Mountain View, Calif., has submitted a list of concessions in an attempt to settle Europe's probe, while the FTC's inquiry remains open.

Although the $22.5 million fine is a record for the FTC, it won't leave much of a financial dent at Google. The company had $43 billion in cash at the end of June and generates $22.5 million in revenue roughly every four hours.

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