I’ve Had It With Google Conspiracy Theories

    June 22, 2007

Okay people, enough is enough.  I can’t go through a day anymore without reading some article or other about how Google has been seduced by the power of the dark side.  It’s debunking time. 

I’ve noticed three common complaints.  First, advertisers complain that Google’s algorithm tweaks do nothing to increase relevance and instead force them to raise their keyword bids.  Second, advertisers also state that Google is trying to learn about their business through CPA advertising and Google Analytics in order to take over their industry.  Third, privacy advocates complain that between search and browsing behavior, Google will know too much about their users.   

Theory #1 – Google adjusts algorithms to force higher bids

Google’s hybrid ranking method has always served two purposes, rewarding relevant ads and increasing their effective CPM (eCPM).  The basic hybrid auction model uses historical click-through rates and the advertisers’ maximum CPCs to calculate Google’s predicted revenue per impression.  The ads that generate the most revenue are ranked the highest.  Those ads also happen to be the ones that users typically prefer.

All the subsequent tweaks have similarly been aimed at increasing relevance and revenue, notably last year’s inclusion of landing pages in Quality Score.  Is Google an “evil” company for wanting to make money?  If they are, so is every ad network and publisher in the history of the world (excluding PBS and other non-profit organizations).  That’s what publishers and networks, (and other businesses, for that matter) do.  They charge their customers as much as they can get away with given product quality, demand, and market value.   

Theory #2 – Google is learning too much about businesses 

By charging advertisers on a cost-per-action basis and giving away Google Analytics for free, conspiracy theorists allege that Google is attempting to learn more about their business.  This empowers Google to enter into almost any industry as a serious contender.  But let’s look at the facts.  In order to learn enough about an industry to be able to start a business that could take over the industry, Google would have to be tracking a significant number of that industry’s minor and major players.  In general, major players choose not to use Google Analytics, and go to great lengths to avoid sharing their conversion data with anyone else.   

Regardless, could we one day see Google leverage their brand, resources, and trove of data to expand into different industries?  Could there be a Google Mortgage (in Beta, of course)?  Absolutely.  Would that be wrong?  Of course not.  It’s business.  If you’re an advertiser and you don’t like it, you’re free to not give Google access to your conversion data.  Or you can always pull an eBay. 

Theory #3 – Google is learning too much about individuals

 Personal users, at the behest of privacy advocates, are starting to get worried about Google collecting their search queries.  If the DoubleClick acquisition goes through, Google will also collect Web browsing behavior.  They will know a lot about what searches are conducted on a certain computer, approximately where that computer is located, and what Web pages that computer visits.  Sounds very Big Brother-ish. 

But what nefarious purpose are they going to use this for?  World domination?  Intergalactic invasion?  Nope, they’re going to use it to show Web browsers more relevant advertising.  I wouldn’t head to my nuclear shelter over that one.  Again, if you’re really afraid, you can stop using Google and/or stop accepting cookies.  Realize, however, that even if you accept no cookies, you will still see ads on the Web.  The ads just won’t be as good. 

The conspiracy theorists might ask what if someone hacks into Google’s system, or there’s an accidental data leak.  What if Google gets subpoenaed for information?  Well, of the search networks that got subpoenaed recently, only one refused to turn over its users’ data.  I’ll let you figure out which one that was.  And hacking?  The truth is, if you don’t know the password to someone else’s PC, you can’t hack into it.  Yet people are talking about accessing Google’s user data as though it’s the kind of thing you do on Sundays between washing your car and mowing your lawn.  A data leak, however, is a serious threat to privacy, one that I would hope Google is dealing with proactively. 

Perhaps Google made a mistake when it adopted the “don’t be evil” motto, which invited people to hold them to a higher standard.   In reality, they have shareholders who expect them to meet targets every quarter and every year.  It’s to be expected that they are going to charge as much as they can for their existing services, develop new products and services to keep their revenue up, and expand into other businesses.  Right now they’re just executing better than anyone else.  In fact, these conspiracy theories are probably less about double standards and more about sour grapes.