Google’s Users are the Real Commodities – Pt. 3

A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities

If you’ve been following along, then you already know what user information Google collects with its name-brand services, in addition to the kind of user information collected by Google via services such as YouTube, Picasa, Blogger and Orkut.

Today, in Part 3 of our mini-series, we want to throw out the question: What does this mean for the future of Google?

Is There a Challenger in the Audience?

At this time, there is little risk of Google’s position being challenged. Because of the volume of data Google has and continues to collect, their dominance in search share, and the high returns they are able to get for advertisers, challenging or ultimately deconstructing Google would harm advertisers much more than it would hurt Google.

Google already has such a large amount of data and market share, advertisers have come to rely on the returns and sales they get from Google ad platforms. Challenging Google would mean that these marketers may have to spend the same or more money on ads for less return.

Connection is the Key

Google has worked hard to promote connectivity between user applications. iGoogle homepages connect to a user’s Gmail account, which can connect to Google Talk and so on. This type of integration means that all of the different Google applications could have a complete set of user data rather than fragmented bits of data spread between applications.

The data is most valuable to Google in aggregate. Altogether it gives Google its advantage in online advertising.

If Google ever divided its services or products into separate entities, by choice or otherwise, maintaining a full set of data assures that each division will keep the same market advantage as they had with Google as one entity.

The Value of User Data

Possibly the biggest potential for future revenue is a sale of Google’s user data. If Google transferred that asset, you would receive notification, but there would be little chance that you would be able to stop the transfer.

“If Google becomes involved in a merger, acquisition, or any form of sale of some or all of its assets, we will provide notice before personal information is transferred and becomes subject to a different privacy policy.”(1)

But what if the United States government privately (or even publicly) asks Google to share its user data for the sake of national security, or any other reason?

Per Google’s Privacy FAQs there is little that users can do to protect their Google-use data from government inquiries:

Google does comply with valid legal process, such as search warrants, court orders, or subpoenas seeking personal information. These same processes apply to all law-abiding companies. As has always been the case, the primary protections you have against intrusions by the government are the laws that apply to where you live.

According to a recent Wall Street Journal article, the National Security Agency (NSA) “now monitors huge volumes of records of domestic emails and Internet searches”. Google has reportedly denied any involvement with the NSA’s Terrorist Surveillance Program.

Google’s user data, or at least the rights to it, will undoubtedly make news headlines far into the future. And with the ongoing release of new applications and services, Google will apparently have little trouble collecting more and more of it.

In the next chapter of our Monthlong Magnification of Google, we’ll take a closer look at the search engine’s investment in a DNA profiling company.

1. Google Privacy Policy, last visited April 7, 2008.