Google agrees to protect privacy

WASHINGTON – With social networking emerging as the most potent force on the Internet, federal regulators are moving to limit how companies can exploit personal information.

Google Inc. just became Exhibit A.

In a settlement hailed as the first of its kind, the Federal Trade Commission said Google had agreed to strict new measures to protect the privacy of its users. Moreover, the company agreed to submit to independent audits for the next 20 years to ensure that it is following the rules.

The agreement settles claims that Google used deceptive tactics in recruiting its Gmail customers last year for its Buzz social network, a competitor to Facebook. In signing up for Buzz, many Gmail users unwittingly agreed to make public a list of the people with whom they emailed most frequently.

FTC officials said it was the first time the government had required a company to put in place a sweeping privacy policy to protect consumer data.

“When companies make privacy pledges, they need to honor them,” FTC Chairman Jon Leibowitz said in announcing the terms Wednesday. “This is a tough settlement that ensures that Google will honor its commitments to consumers and build strong privacy protections into all of its operations.”

Privacy advocates said the action has far-reaching implications beyond Google, as Internet search and social network ventures rely heavily on the mining of user information to sell advertising.

Facebook, for example, sells targeted advertising to its users based on their stated preferences in movies and music. Google computers scan the contents of Gmail messages, looking for key words such as “camping,” say, to hit users with ads for camping gear. In both cases, the companies explain those features in their privacy notices.

“This will limit the data mining of social media companies that try to do it without a clear-cut explanation of what they’re doing,” said Joseph Turow, a professor at the University of Pennsylvania’s Annenberg School for Communication. “The FTC is trying to stake out territory to say that when a company says it’s doing something to keep data private, it better do it.”

Even so, privacy experts said the FTC’s recent actions were evidence of a greater industrywide problem. The absence of strong federal privacy laws has allowed many technology companies to freely gather a great deal of information about consumers without their explicit permission – and without federal oversight.

The agreement came as Google once again launched into the social networking arena Wednesday with a tool, called +1, that lets users tag search results and advertisements so they can recommend them to friends.

The feature, aimed at competing with Facebook and getting a bigger foothold in social networking, connects to the same list of personal contacts that Buzz did. The idea is that users will trust Web page recommendations from friends over those from the computerized search engine.