This week, Alphabet Inc. agreed to pay $392 million to the Federal Trade Commission for its location tracking without consent. This was one of the largest data privacy settlements in the company’s history, and comes just days before their quarterly earnings.
If Google wishes to avoid the expense of the settlement, legislative changes could help defend the company from future lawsuits.
Some states sued Google in 2020 alleging that the company illegally tracked users of Android devices for years. The suit claimed that users were promised that their location history can be disabled at any time but had no idea what other means Google would use to track and store their locations.
Google announced that the $50 million settlement is owed to more than 10 million affected users, but it’s done nothing for the privacy of individuals and nothing at all to discredit their anti-user behavior. Google has agreed to more updates in the coming months to give users transparency and control over their personal data.
Though some experts believe that the fine and Google’s announcements won’t be enough to get tracking companies to change their location-tracking practices, it is a start.
“Google has $6.5 billion in annual revenue, so getting rid of the tracking software would cost them $400 million,” said Alan Pelz-Sharpe, founder of market analysis firm Deep Analysis. “More importantly, it’s actually incredibly costly to eliminate tracking at scale.”
Legislation is needed to effect change
Despite the looming threat of potential lawsuits and governmental punishment for those who use location tracking technology, most companies that deploy it will continue to use it because of the significant business benefits it provides.
“Most will continue to do this, but hopefully they don’t get caught and will issue a mea culpa if they do,” he said.
Seeley George, the legislative director for Congressional Asian Pacific American Caucus, stated that the group is pushing Congress to pass the American Data Privacy and Protection Act (ADPPA) during the lame-duck session before new Congress members take office in January. She said sections of the policy are necessary because “we cannot trust companies.”
Newer technologies and global development of the internet are continuously changing and exposing us to new risks. The only way we’ll really get the changes needed to guarantee privacy is through policy. We need federal data privacy legislation yesterday, and stronger antitrust laws would be a good step towards preventing monopolies that have high control over the public’s digital data.
There’s little chance of federal legislation advancing in 2022, as both parties are unable to agree on the exact language that should be included in such a law. The ADPPA (Amending Data Protection and Privacy by Providing for Accountable Databases) has not been enacted yet, which means fairly high chances for its success.
Google has released a settlement that’s likely to have some profound effects on how businesses operate online.
Businesses that want to stay successful should heed Google’s settlement, which Forrester Research analyst Stephanie Liu says is evidence of an increasing trend in regulator-approval standards. Businesses that don’t comply may not be so successful.
The European Union recently passed the Digital Markets Act, which requires all content providers to be clear about when viewers are opted-in and when they’re not. In fact, France’s data protection regulator fined Google nearly $155 million for not complying with the act in instances of display analytics and behavioral advertising.
In the U.S., regulations in California and even proposed legislation by ADPPA prohibit deceptive methods of receiving consent.
The decision reflects that when users are given counterintuitive opt-out choices, they’re less likely to take advantage of them. It reminds us that it is necessary to design user experiences which are more straightforward and easy to understand.
Makenzie Holland is a news writer with a focus on technology and federal regulation. Prior to joining TechTarget, she was a reporter at the Wilmington StarNews and the Wabash Plain Dealer.