Significant Business Risk

More facts and fun about the privacy issue facing Google et al – from MediaPost’s Just an Online Minute:

For Google, fallout from the government attempt to subpoena the company’s records isn’t likely to end any time soon.

For now, the government is seeking only a list of 1 million Web sites and records of searches done in a one-week period. And, despite some muddled news reports, the feds aren’t seeking this information as part of an effort against “child pornography.” Instead, the government wants to prove that minors have easy access to online porn–though why the feds think they need Google’s help with this remains mystifying.

Even though the government isn’t seeking any personally identifiable information, the public at large has grown concerned–apparently because people are just now realizing that companies like Google store searches.

A recent survey by the Ponemon Institute found that 89 percent of Google users believe their Web searches are private. What’s more, 62 percent said that if Google released information about their Web searches to the government, they would stop using Google. For the report, Ponemon surveyed more than 1,000 Web users this weekend.

Those numbers alone show that Google–not to mention the rest of the search industry–will soon face a monumental crisis unless the public is reassured that the feds aren’t going to get their hands on information that will link people with their Web searches.

Don’t want to beat a dead horse here, but I think this will emerge as a Significant Business Risk to Google. Not because consumers will stop using it – people say all sorts of things in surveys the never actually do in practice, and there are numerous ways to word questions to get great headlines the next day.

But, as I have written before, the threat, compounded the longer the bad press continues, is that the brand advertisers, i.e., the growth engine, will start avoiding the medium.