Inside Google

It’s not as if Google lacks privacy controversies to quell.

Yet Burson-Marsteller, a top-five public relations firm, is attempting to pile more on.

Burson last week stepped up a whisper campaign to get top-tier media outlets, including USA TODAY, to run news stes and editorials about how an obscure Google Gmail feature — Social Circle — ostensibly tramples the privacy of millions of Americans and violates federal fair trade rules.

Google said that Social Circle in fact allows Gmail users to make social connections based on public information and private connections across its products in ways that don’t skirt privacy.

Yet the PR stunt played out during a week in which Google was responding to a raid of its Seoul office by South Korean privacy regulators and was preparing for a U.S. Senate hearing today over the location-tracking feature in Android smartphones.

Pushed by two high-profile media figures — former CNBC news anchor Jim Goldman and former political columnist John Mercurio, both of whom recently joined Burson — the whisper campaign illustrates how privacy has become a lightning-rod issue. Goldman pitched the Social Circle issue as a huge privacy breach to Google users and an important story for consumers.

“Privacy issues are certainly complex,” says Maneesha Mithal, associate director of the Federal Trade Commission’s Division of Privacy and Identity Protection.

Burson’s efforts, on behalf of an unnamed client, also highlight the delicate balancing act Google, Microsoft, Facebook and Apple face as they rush to profit from cutting-edge Internet services that tap into consumer data. Several pioneering privacy rights bills are gaining steam in Congress and in California. And Sen. Al Franken, D-Minn., chairs today’s hearing, where he is expected to grill executives from Apple and Google about how iPhones and Android smartphones keep precise track of each user’s whereabouts every day.

The tech giants “need to ensure that consumers understand their data is being accessed and used with proper controls to ensure its protection,” says Dan Hoffman, a mobile security expert at networking company Juniper.

Google, however, often pushes out new consumer services that affect privacy without clearly conveying what the technology does.

Earlier this year, it reached a settlement with the FTC for exposing Gmail users’ contacts as part of an ill-fated launch of its Buzz social network in February 2010.

And it faces probes in several nations and U.S. states for dispatching fleets of specially equipped cars through city streets to harvest data from wireless networks in homes and businesses.

“Much of Google’s privacy problems stem from the company’s culture,” says John Simpson, spokesman for the non-profit Consumer Watchdog. “They hire like-minded engineers who push the creepy line, then apologize when they get caught with their fingers in the cookie jar.”

Against this backdrop, Goldman and Mercurio began engaging reporters and technologists about Social Circle, casting it as a stealthy feature circulating potentially embarrassing information among Gmail users in ways that violate FTC rules.

In a May 3 e-mail to former FTC researcher and blogger Christopher Soghoian, Burson’s Mercurio offered to ghost write an op-ed column to that effect for Soghoian. Mercurio even offered in a widely circulated e-mail to help Soghoian get it published in The Washington Post, Politico, The Hill, Roll Call and The Huffington Post.

Meanwhile, Goldman connected with USA TODAY and outlined a news story critical of Social Circle.

However, Soghoian derailed Burson’s efforts by posting the full e-mail text of Mercurio’s pitch — along with his rejection — on the Internet. After Goldman’s pitch proved largely untrue, he subsequently declined USA TODAY’s requests for comment.

Meanwhile, Google began fielding media calls about the heretofore obscure Social Circle. The company acknowledges reviewing Mercurio’s pitch.

“We have seen this e-mail reportedly sent by a representative of the PR firm Burson-Marsteller,” says Chris Gaither, Google’s senior manager of global communications and public affairs, who assumes the e-mail exchange in fact took place. “We’re not going to comment further. Our focus is on delighting people with great products,” he said.

Social Circle’s intent

Gaither points out that Google’s Social Search, of which Social Circle is now part of, was launched in October 2009 as a tool to help remind Gmail users of the people they regularly e-mail or chat with, so-called direct connections.

The service also privately sends each Gmail user the names of “secondary connections,” a listing of the people each direct connection happens to be following publicly on the Web.

Google prompts Gmail users to voluntarily connect any accounts they have on Facebook, Yahoo, Flickr, LinkedIn, Quora, Twitter or Yelp to their Google profile.

Google then mines those connected accounts for individuals who become secondary connections.

“Social connections are based on publicly available information and private connections you have on Google products and services,” explains Gaither.

USA TODAY asked 26 avid Gmail users about Social Circle and found only two were vaguely aware of the service, while 14 said they would disable the service, if they could, citing privacy concerns.

Gaither attributes low awareness to the fact that Google purposely designs new features “to blend seamlessly … because that’s what our users prefer.”

That explanation works for Elizabeth Holst, 26, a grad student in Chicago, who acknowledges how difficult it has become to remain anonymous online.

“Why fight it?” Holst says. “And there is value in hearing about things from your friends.”

By contrast, Jason Gerdon, 29, a public relations professional in Costa Mesa, Calif., says he’d like to opt out of the service.

“I like having control over my connections,” Gerdon says. “Although this might be similar to Facebook or Twitter recommendations, this just feels more intrusive.”

Dion Moses, 25,

a computer engineer in Ridgecrest, Calif., also wants out of Social Circle. “This is shocking,” Moses says. “I had no idea that Google was doing this, and I pay close attention to most technology news sites.”

The only way to disable Social Circle, Gaither says, is to stop using Gmail.

Chasing Facebook

Google’s push to proactively expand Gmail users’ connections, in fact, derives from Facebook’s stunning success at enticing its 500 million-plus users to voluntarily reveal their closest acquaintances, along with rich information about their preferences and online behaviors, says Kevin Lee, CEO of search consultancy Didit.

Google, by comparison, can really only profile Internet users based on their search queries and who they e-mail and chat with, Lee says.

The search giant generated $29.3 billion in revenue in 2010, mainly by selling sponsored ads to appear alongside specific search query results.

Facebook, a private company, is believed to generate about $2 billion in annual revenue by selling ads targeted to specific groups of friends, such as expectant mothers, recent retirees or frequent fliers, Lee says.

Social-networking sites — Facebook, in particular — are not without privacy problems. They face heightened scrutiny over their evolving privacy policies from consumers, privacy advocates and legislators.

While most Facebook users “freely provide information about themselves, it’s far less clear that they understand how that information is being used by Facebook or third parties to profile them,” says Opus Research analyst Greg Sterling.

Even so, Google has set out to emulate Facebook by using tracking programs and algorithms to connect more members from the top social networks to Gmail users.

“Google wants access to the dollars that Facebook is getting,” Lee says. “They’re trying to create a product that comes closer to mirroring Facebook’s ability to target specific groups of people for advertisers.”

As Google extends connections between Gmail and the top social networks, it risks upsetting at least some Gmailers.

“Users have a very high expectation of privacy in their e-mails,” says Kimberly Nguyen, consumer privacy counsel for EPIC.