Sunwoo KimGoogle and Internet PrivacyInternet MarketingFrom .docx

Sunwoo Kim
Google and Internet Privacy
Internet Marketing
From Dorm Room to Board Room: The Google Story
Don’t Be Evil
Xia Yin
How Google Searches Work
Persistent Cookies
From Data Retrieval System to Internet Empire
Internet Privacy Concerns
Jack Alcorn
Cookies – Still Persisting
Gmail: For G-Men?
Peeping Tom Street View Mapping Tool
A Double Take on DoubleClick
Ben Schmitz
Later That Morning
New Developments
UV1354
Rev. Jan. 20, 2010
This case was prepared by Joan Denoncour, Edward Heffernan,
Rahul Koranne, Jake Marxen, Thomas Neu, and
Narayanan Sundaresan, University of Minnesota Executive
MBA students; Norman E. Bowie, Elmer Andersen

Chair in Corporate Responsibility, University of Minnesota;
Jared Harris, Assistant Professor of Business
Administration, Darden School of Business; and Jenny Mead,
Senior Ethics Research Associate, Darden School of
Business. It was written as a basis for class discussion rather
than to illustrate effective or ineffective handling of an
administrative
Virginia Darden School Foundation, Charlottesville,
VA. All rights reserved. To order copies, send an e-mail to
[email protected] No part of this
publication may be reproduced, stored in a retrieval system,
used in a spreadsheet, or transmitted in any form or by
any means—electronic, mechanical, photocopying, recording, or
otherwise—without the permission of the Darden
School Foundation. Rev. 1/10.
GOOGLE AND INTERNET PRIVACY (A)
Privacy is the right to be left alone—the most comprehensive of
rights, and the
right most valued by free people.
—Justice Louis Brandeis, Olmstead v. U.S. (1928)
Ken Winber sat in his office, staring at the computer. What
trouble computers in general
caused, he thought. Head of Human Resources at an East Coast
bank, he was old enough to
remember IBM Selectrics and while he welcomed the efficiency
and speed that technology and
computers brought to the workplace, he sometimes resented the

problems that had emerged with
them. His immediate dilemma involved two employees, Andy
Richards and Nancy Woodhouse,
who had just left his office. They had found some intrusive and
potentially disturbing internet
pop-ups on a shared office computer and had met with Winber
to tell him. Winber thought back
to his conversation.
Andy Richards was a full-time customer service representative
for the bank who worked
the night shift; Nancy Woodhouse, who worked the day shift,
was a forty-something mother of
three. Richards had recounted a recent night when he had been
working on his computer, shared
by several part-time employees during the day. Almost
immediately after turning on his
computer and launching his browser, an ad for a drug called
Aptivus popped up on his computer
screen. He did not pay much attention to the ad and quickly
clicked the “close” button. A few
minutes later, another pop-up for yet another drug, appeared.
Before closing this pop-up,
Richards realized that this drug, Selzentry, was some new
HIV/AIDS medication.
When a pop-up for Reyataz appeared a few minutes later
imploring Richards to “Fight
HIV Your Way,” he realized something unusual was happening.
Although not a marketer, he
was familiar with how Internet advertising worked. When
someone visited a Web site, a

“cookie” sent from the server of an interested marketing firm
was often attached to the browser
and used to track an Internet user as he or she moved from site
to site. The user’s site preferences
For the exclusive use of X. Yin, 2017.
This document is authorized for use only by Xiaoyi Yin in F17
Strategic Management-3 taught by Charles Boughton, Truman
State University from July 2017 to January 2018.
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were then compiled so that the user would receive advertising
messages, often in the form of
pop-ups, tailored to his or her interests.
After receiving three consecutive ads for AIDS medication,
Richards began to wonder if
someone from another shift who shared his computer was
actually researching or buying AIDS
medication on the Internet. Why else would companies that sold
HIV medication be so eager to
offer him their drugs? Could he be sharing computer and phone
equipment with someone who
was HIV-positive? He began to think about the bank employees
who also used his computer.
Kyle Talbot was a college student who worked at the bank to
pay for school. Charlie Patton was
a the part-time afternoon shift employee who had just started at
the bank. He was single, quiet,
and kept to himself.

The next morning, Richards had discussed the pop-ups with
Woodhouse.
“It’s gotta be Charlie!” Woodhouse had exclaimed. “I wonder if
HR knows about this.”
After further conversation, Woodhouse and Richards decided to
approach Ken Winber
with their findings and their suspicion that Charlie was either
HIV-positive or had AIDS. Both
admitted to Winber that they felt a bit guilty for what they
termed “snitching” on a co-worker,
but they were also concerned that neither the bank’s HR
department or employees in general
were aware that someone in their midst might be sick.
Winber had listened carefully to the employees but said nothing
except that he would
handle the situation. Richards and Woodhouse thanked him and,
rather sheepishly he thought,
left.
Internet Marketing
Internet marketing was the marketing of products and services
over the Internet. The
broad reach of the Internet had made it a significant and
attractive marketing channel for many
companies because it offered a very cost-effective way of

reaching vast audiences at any hour on
any day. Also, the overall efficiency of Internet media was
much easier to track than that of
traditional off-line media. Successful Internet marketers tied
together both creative and technical
aspects of the Internet to leverage partnerships with popular,
high-traffic Web sites. To an on-
line marketer, a partnership with a company like Yahoo! or
Google was a boon. These sites
provided exposure to the millions of daily visitors and, given
the sheer number of potential
buyers, offered high likelihood of consumer response.
Special technological tools also allowed Internet marketers to
target individual consumers
with products specific to their needs. One such tool was a
cookie. Also known as Web cookies,
cookies were bits of text sent back and forth every time a user’s
Web browser accessed the
server of a given Web site. The server used these bits of text to
authenticate and track user
information, such as Web site preferences or specific purchases
made through e-commerce.
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Because they could be used for tracking Internet browsing
behavior, cookies had been the
subject of increased privacy concerns in the United States and
abroad. Also, cookies were often
criticized for misidentifying users.
While cookies were only sent either to the server setting them
or a server in the same
Internet domain, a Web page might contain images or
components stored on the servers of other
domains. Cookies that were set or dropped on a user during the
retrieval of one of these images
were called third-party cookies. Third-party cookies allowed a
marketing company to track and
compile an individual’s Web activity across the sites of
different companies as well as personal
information provided under the assumption of anonymity.
The use of cookies, coupled with the storage of vast amounts of
search-term data, had led
to an increase in privacy concerns over large Internet search
engines such as Yahoo! and Google.
For Google in particular, the concern was heightened by its
announcement in April 2007 that it
would purchase DoubleClick, a controversial Internet marketing
firm, for $3.18 billion; however,
the Federal Trade Commission and Congress did not green-light
the deal until December of that
year, primarily because of concerns about potential consumer-
privacy abuse. In March 2008,
Google officially acquired DoubleClick.

Google claimed that the search data from its millions of users
was accessible only to its
servers, but one could easily imagine someone discovering
sensitive information about an
Internet user, intentionally or not. If knowledge is power, did
the massive amounts of
information Google had stored on millions of people grant them
too much power? Would the
merger of a search giant and an on-line marketing giant like
DoubleClick create a source of
information so large that it would be too tempting for criminals
or even the government to
ignore?
From Dorm Room to Board Room: The Google Story
Google’s mission was “to organize the world’s information and
make it universally
accessible and useful.”1 Co-founders Larry Page and Sergey
Brin began developing their
approach to organizing the world’s information in their Stanford
University dorm room in 1996.
The doctoral candidates believed that “analyzing relationships
between websites was a better
way to search than current techniques, which ranked results
according to the number of times the
search term appeared on a page.”2 They registered the domain
name Google.com on September
15, 1997. (The site they wanted, Googol.com, was already
taken. A googol was a 1 followed by
100 zeroes, and the company’s play on the term reflected its
mission to organize the immense

1 Google’s mission statement from Google.com,
http://www.google.com/corporate/index.html (accessed
October 31, 2008).
2 Lawrence Page, Sergey Brin, Rajeev Motwani, and Terry
Winograd, “The PageRank Citation Ranking:
Bringing Order to the Web,” technical report, Stanford
University InfoLab, November 11, 1999.
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amount of information available on the Web). With $1.1 million
from angel investors, Page and
Brin incorporated Google.com on September 7, 1998 in one of
their friend’s garages. After 2001,
the company grew organically and through acquisitions of other
startup companies, including
YouTube.
Google became a NASDAQ-traded corporation generating the
majority of its revenue
from Internet searches and on-line advertising. Google’s initial
public offering took place on

August 19, 2004, at $85 per share. Shares hit $700 for the first
time on October 31, 2007, and as
of December 11, 2007, they went for $718.54. See Exhibit 1 for
stock-price history. In addition
to search and advertising services, Google also offered e-mail
(Gmail), on-line mapping, office
productivity tools, and video sharing via YouTube, among other
services (see Exhibit 2 for a
complete list). As of August 2007, Google was the most used
search engine on the Web with a
53.6% market share, ahead of Yahoo! (19.9%) and Live Search
(12.9%).3 Almost four out of five
Internet searches happened on Google or on sites that licensed
its technology, such as AOL,
Netscape, iWon, Compuserve, and Alexa. The Mountainview,
California-based company had
more than 15,000 employees and garnered $10 billion in
revenue in 2006, almost $10 billion of
which was from advertising alone.4 Google earned $16 million
(almost $16 million from
advertising) in revenues in 2007.
Don’t Be Evil
Don’t Be Evil was Google’s informal corporate motto. John
Battelle described its origins
in his book, The Search.5 The motto was coined by Paul
Buchheit, a Gmail engineer:
On July 19, 2001, about a dozen early employees met to mull
over the founders’
directive [to elucidate Google’s core values] ... The meeting
soon became

cluttered with the kind of easy and safe corporate clichés that
everyone can
support, but that carry little impact: Treat Everyone with
Respect, for example, or
Be on Time for Meetings. The engineers in the room were
rolling their eyes.
[Amit] Patel recalled:
Some of us were very anticorporate, and we didn’t like the idea
of all these
specific rules. And engineers in general like efficiency—there
had to be a way to
say all these things in one statement, as opposed to being so
specific. That’s when
Paul Buchheit, another engineer in the group, blurted out what
would become the
3 Enid Burns, “Top Ten Search Providers,” The ClickZ
Network, September 25, 2007,
http://www.clickz.com/showPage.html?page=3627121 (accessed
October 31, 2008).
4 Google.com Investor Relations page, financial tables for Year
2007, http://investor.google.com/fin_data.html
(accessed October 31, 2008).
5 John Battelle, The Search: How Google and its Rivals
Rewrote the Rules of Business and Transformed our
Culture (New York: Portfolio, 2005).

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most important three words in Google’s corporate history. Paul
said, “All of these
things can be covered by just saying, Don’t Be Evil.” And it
just kind of stuck.6
Google’s founders were purists at heart, and Don’t Be Evil
meant that they wanted to
hold themselves to the highest journalistic standards and ethics
in order to be objective and
unbiased. Google worked to present the information that was
most relevant to the end-user, not
the information that advertisers paid the most money for people
to see. In other words, unlike
many large corporations, Google put its reputation and brand
image ahead of short-term profits.
Google’s August 2004 prospectus for its IPO read:
Google users trust our systems to help them with important
decisions: medical,
financial and many others. Our search results are the best we
know how to
produce. They are unbiased and objective, and we do not accept
payment for them

or for inclusion or more frequent updating. We also display
advertising, which we
work hard to make relevant, and we label it clearly.
This was similar to a well-run newspaper, where the
advertisements are clear and
the articles are not influenced by the advertisers’ payments. We
believe it is
important for everyone to have access to the best information
and research, not
only to the information people pay for you to see.7
Google management told its employees, Don’t Be Evil, but they
also constantly reminded
them that purity mattered.8 Page and Brin were determined to
keep their Web site free of
banners, pop-up screens, and negative ads; their site was
simple, uncluttered, and minimalist. If
the architect Ludwig Mies van der Rohe, known for his
minimalist style and his aphorism, “Less
is more” had to pick a search engine, he would likely pick
Google.
How Google searches work
The technology Google used to develop the perfect search
engine was somewhat
complex, but the premise behind it was simple: something that
“understands exactly what you
mean and gives you back exactly what you want,” as Larry Page
put it.9 Google’s design and

interface made it very user-friendly, and instead of using a
small number of large servers that
would slow down during peak usage periods, Google used a
series of networked PCs,
minimizing response times. Google’s 1996 breakthrough
technology—the heart of its searching
6 “Origin of Don’t Be Evil,” Dontbeevil.com, September 25,
2005; http://www.dontbeevil.com/2005/09/origin-
of-dont-be-evil.html (accessed October 31, 2008).
7 Google’s prospectus as submitted to SEC for IPO.
http://www.sec.gov/Archives/edgar/data/1288776/
000119312504142742/ds1a.htm#toc59330_1 (accessed October
31, 2008).
8 Josh McHugh, “Google vs. Evil.” Wired.com, January 2003,
http://www.wired.com/wired/archive/
11.01/google_pr.html (accessed October 31, 2008).
9 “Technology Overview,” Google.com corporate site,
http://www.google.com/corporate/tech.html (accessed
October 31, 2008)..
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software—was PageRank, an algorithm that ranked Web pages

matching a given search string.
The Web site used PageRank to examine the entire link
structure of the World Wide Web and
thus determine which links were the most important ones to
display. “Google then conducts
hypertext-matching analysis to determine which pages are
relevant to the specific search being
conducted. By combining overall importance and query-specific
relevance, Google was able to
put the most relevant and reliable results first.”10
Google’s robust search engine required that all of the user’s
search terms appear either in
the text of the page or in the links pointing to the page, sparing
users the frustration of viewing
irrelevant results. After analyzing where the search terms
appeared, Google prioritized results
based on the terms’ relative proximity, favoring pages with
greater term proximity and thus
greater likelihood of relevance to the query. A preview of each
page so ranked was displayed so
users could judge its relevance before visiting it. Google was so
confident in the relevance of its
results that it gave users the option to use an I’m Feeling Lucky
button, which took them directly
to the site of the highest-ranked result in a search.
While analyzing the relevance of each page, Google stored a
snapshot in a cache. If the
original page was temporarily unavailable due to Internet
congestion or server problems, a user
could access these cached pages, which contained information
that was frequently not the most

recent but usually useful. In addition, the search terms would be
highlighted in color on the
cached page, making it easy to find the section of the page
relevant to the search query.
Google’s complex automated methods made human tampering
with its search results
extremely difficult. Though Google ran relevant ads above and
next to results, it did not sell
placement within the results themselves (i.e., no one could buy
a particular or higher placement).
Google prided itself, also, on its extremely fast search time. See
Exhibit 3 for a visual
representation of a Google search.
Persistent cookies
Google defined a cookie as a small file containing a string of
characters that was sent to
the user’s computer when he or she visited a Web site. When
the user visited the Web site again,
the cookie would persist, or allow that site to recognize the
user’s browser. Cookies stored user
preferences and other information that Google then utilized to
determine which sites to return in
the user search. According to Peter Fleischer, Google’s Global
Policy counsel, Google used
cookies, (for example, the PREF cookie, short for preference
cookie) to remember such basic user
preferences as “English speaker” or “no more than 10 results on
a given page” to make the
search process user-friendly.11 In a July 2007 Google blog

entry, Fleischer said that they initially
set the PREF cookie expiration to the year 2038 because “the
primary purpose of the cookie was
10 http://www.google.com/corporate/tech.html.
11 Peter Fleischer, “Cookies: Expiring Sooner to Improve
Privacy.” GoogleBlog, July 16, 2007,
http://googleblog.blogspot.com/2007/07/cookies-expiring-
sooner-to-improve.html (accessed October 1, 2008)
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to preserve preferences, not to let them be forgotten.”12 Google
initially figured that because
people could use their browsers to change or delete their cookie
settings at any time, they would
be amenable to such a cookie lifetime.
As a result of an onslaught of criticism from privacy advocates
and the media, Google
realized it needed to change its cookie policy. In July 2007, it
announced that it would take a
two-pronged client and server approach to improving user
privacy. As far as the client-side was

concerned, by the end of 2007, Google was committed to:
Issuing to users cookies that will be set to auto-expire after two
years, while auto-
renewing the cookies of active users during this time period. In
other words, users
who do not return to Google will have their cookies auto-expire
after two years.
Regular Google users will have their cookie auto-renew, so that
their preferences
are not lost. And, as always, all users will still be able to
control their cookies at
any time via their browsers.13
To further protect the user’s privacy, Google announced that it
would make search server
logs with IP addresses and cookie ID numbers anonymous after
18 months. (Previously server
logs had been maintained indefinitely.) By doing so, Google
made it difficult to trace any
specific query back to a particular computer, much less to a
person who used that computer.
Ultimately, Google decided to allow anonymity by removing the
last eight bits of IP data. At the
same time, although Google wanted a uniform alteration of
cookie data after 18 to 24 months,
the company admitted that, for legal reasons, it might have to
keep some of the data for a longer
period.
From data retrieval system to Internet empire

From its beginnings in 1996 as a simple idea for a data-retrieval
system, Google had
grown into an Internet empire in 10 short years. While google
had entered the English lexicon as
a synonym for Internet search, the company’s reach extended
far beyond data retrieval. It was
now an e-mail service, an array of office tools, a street-view
system, and a video-sharing utility.
It was also a blogger, a translator, and a scrapbook of images
near and far. Google was all this
and then some and only continued getting bigger. As with any
firm that became the biggest or
best at what it did—Wal-Mart in retail, UnitedHealth Group in
health insurance, or Time Warner
in communications—Google found itself the target of intense
public scrutiny, both positive and
negative. Sergey Brin, self-acclaimed “techie” and, in 2008,
head policy-maker at Google, found
himself at the center of most controversies associated with the
Internet, including the invasion of
privacy. As Google’s reach extended internationally and beyond
its origins as a basic search
engine, its ideals of goodness and purity became that much
more elusive.
12 Fleischer.
13 Fleischer.

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Internet Privacy Concerns
Internet privacy was a battleground between Internet companies
such as Google—along
with marketing counterparts wanting to know as much about
users as possible—and
unsuspecting consumers. In general, Internet users were quite
sensitive to providing too much
information, especially if they were not sure where or how that
information would be used.
Compounding the issues with Internet privacy was that
consumers usually had no idea exactly
what information was being captured; in fact, they often did not
even realize that information
was being captured nor with whom it was being shared. The
highest potential risk to consumers
would be the theft and ultimate misuse of this information. In
addition, the government might be
able to obtain user data for ambiguous and potentially dubious
reasons. How could consumers be
certain that their personal information would be protected from
misuse?
According to one independent analyst, consumers were losing
the battle against Internet
giants such as Google. Economist Simon Smelt, owner of the
survey firm SimplyQuick.com,
said that most privacy policies on many Web sites were
“slipping,” offering consumers less

protection.14 In a June 2006 survey, most of the top 90 sites
surveyed had policies indicating that
personal information would not be shipped to third parties. A
follow-up survey in November
2006 revealed that most site policies now indicated that firms
retained the right to sell the
information to outside parties, leaving the burden on consumers
to “opt out.” In fact, only 30%
of the 90 sites surveyed guaranteed they would not sell
consumer data. Smelt suggested that
increasing financial pressures were leading e-commerce sites to
see personal data “as a resource
itself.”15
Cookies—still persisting
As technology advanced in the 2000s, things only became more
complicated. For
example, the “persistent cookies” referred to above were stored
on a user’s hard drive until they
expired or were deleted by the user, although most users
probably did not know how to perform
the delete. Persistent cookies were more advanced than typical
cookies and captured a lot more
data on often-unsuspecting Web surfers, who were becoming
increasingly worried that with
every click of the mouse a little more information was being
collected about them and a little
more privacy was slipping away.
Google responded to criticism over the length of time persistent
cookie data was

maintained by assuring the public that, by the end of 2008, it
would improve the anonymity of
data after 18 to 24 months; however, critics questioned whether
Google was really making that
data anonymous. Was it impossible to be a little anonymous,
just as it was impossible to be a
little pregnant? According to Ryan Singel of Wired.com, the
time limit on cookie-data storage
14 Bob Sullivan, “Online Privacy Fears Are Real,” MSNBC,
December 6, 2007, http://www.msnbc.msn.com/
id/3078835/ (accessed October 31, 2008).
15 Sullivan.
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did not really make much difference: even if a user visited
Google only once in two years, the
two-year period was automatically extended, and the cookies
would never expire. In addition,
Singel said that, for those people who did not occasionally
destroy their cookies, Google would
still record their entire search history “for posterity and
potential subpoenas.”16 Singel said that
Google had missed a potential solution:

Now what would have been really cool is if the ultra-smart
Google engineers—
the ones who created Gmail and the very good PageRank search
algorithm—
separated preference cookies from logging cookies. That way
Google could set
the preference cookie for hundreds of years, but users could
decide—based on
how much trust they have in Google and the government—how
long they would
like Google to be able to log their search queries and/or Internet
browsing.17
So while Google did address preference cookies to some degree,
it had not addressed
logging cookies. While logging cookies themselves did not save
any sensitive data on a hard
drive, they did allow other people using your computer to have
access to your private
information, as was the case with Andy Richards in the
introduction. One solution for users
might have been to entirely disable cookies through their Web
browsers. But a major drawback
of this approach was the inability to visit certain Web sites that
required cookies.
Gmail: For G-men?
Google’s e-mail service, popularly known as Gmail, was also
keeping Sergey Brin up at
night. Gmail messages were automatically scanned by Google

“to add context-sensitive
advertisements to e-mails.”18 Privacy advocates raised concerns
that in scanning their personal
and what they assumed to be private e-mails, Google was
invading users’ privacy. Allowing e-
mail content to be read by another party diminished the
“expectation of privacy” in e-mail.19 In
addition to scanning Gmail account holders, Google also
scanned e-mail that nonsubscribers
(who had not agreed to Gmail’s terms of service or privacy
policy) sent to Gmail accounts.
Privacy advocates also took umbrage with Google’s
nondisclosure of policies for data
retention and correlation. It was now possible for Google to
combine information contained in a
person’s emails with information about their Internet searches.
While Google addressed cookie
privacy concerns in July 2007, it did not address correlation
issues. It was not known how long
such information would be kept, and how it could be used. “One
of the concerns is that it could
16 Ryan Singel, “Google Changes Cookie Policy But Privacy
Effect Is Small,” Wired Blog, July 16, 2007,
http://blog.wired.com/27bstroke6/2007/07/google-changes-.html
17 Singel.
18 “Gmail Information,” Google.com, http://www.google-
online-business.com/google-information/gmail.php
19 “Thirty-One Privacy and Civil Liberties Organizations Urge

Google to Suspend Gmail.” Privacyrights.org,
April 19, 2004,
http://www.privacyrights.org/ar/GmailLetter.htm (accessed
October 1, 2008).
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used by law-enforcement agencies. More than 30 privacy and
civil-liberties organizations urged
Google to suspend Gmail service until these issues were
resolved.”20
There had also been criticism regarding Gmail’s privacy policy,
which contained the
clause, “Residual copies of deleted messages and accounts may
take up to sixty days to be
deleted from our active servers and may remain in our offline
backup systems.” Google
continued to reply to this criticism by pointing out that Gmail
adhered to industry-wide practices.
Google later stated that it would “make reasonable efforts to
remove deleted information from
our systems as quickly as is practical.”21

The Web site “Gmail-is-too-creepy.com” had other issues with
Gmail. The site’s
founders were concerned that an email message in the United
States became “just another
database record” after 180 days and lost its status as “a
protected communication under the
Electronic Communications Privacy Act.”22 At that point, if a
law enforcement organization
wanted to see those “database records,” it simply had to produce
a subpoena, not a warrant.
Other countries in which Google’s databases were distributed
did not even have this basic
protection. It also bothered “Gmail-is-too-creepy” that Google
frequently repeated the phrase,
“governmental request” in its Gmail policy, and that in effect,
users consented “to allow Google
to show any and all email in their Gmail accounts to any official
from any government
whatsoever.”23
Peeping Tom: Street View mapping tool
Ms. Kalin-Casey, who manages an apartment building (in
Oakland, CA) with her
husband, John Casey, was a bit shaken when she tried a new
feature in Google’s
map service called Street View. She typed in her address and
the screen showed a
street-level view of her building. As she zoomed in, she could
see Monty, her cat,
sitting on a perch in the living room window of her second-floor
apartment.24

Google’s Street View, a function of Google Maps, launched in
May 2007 and
immediately sparked controversy. According to the Times.com,
within two days of its launching,
Wired.com collected images from Street View of “pedestrians
picking their noses, police
attending a fatality, a man climbing into an apartment block,
and a possible drug deal. There are
20 “Thirty-One Privacy and Civil Liberties Organizations Urge
Google to Suspend Gmail.”
21 “More on Gmail and Privacy,” Google.com,
http://mail.google.com/mail/help/about_privacy.html (accessed
August 15, 2008).
22 Gmail-is-too-creepy.com blog, http://Gmail-is-too-
creepy.com/ (accessed October 10, 2008).
23 http://Gmail-is-too-creepy.com.
24 Miguel Helft, “Google Zooms In Too Close for Some.”
NYTimes.com, June 1, 2007,
http://www.nytimes.com/2007/06/01/technology/01private.html,
(accessed September 8, 2008).
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also images taken inside New York’s tunnels, a practice
frowned on by the authorities since the
September 11 attacks.”25
Street View was easy to use. Users simply clicked on a specific
point on a city map, and
Street View gave them a street-level, 360-degree image of that
point. According to Stephen
Chau, the Street View project manager, vehicles equipped with
imaging technology drove
though public streets and took pictures from the perspective of
someone walking down the street.
They only took pictures on public property, and the images were
available in many formats for
cities all over the world.26 Google removed imagery that was
objectionable or sensitive, such as
nudity, locations of domestic violence shelters, or clearly
identifiable people. If viewers wanted
an image removed, they could click a link that took them to
Street View Help and request it be
reviewed for removal.
Despite Google’s attempts to ameliorate the concerns of privacy
activists, many people
were still outraged at what they perceived as Google crossing
the line between “taking public
photos and zooming in on people’s lives.”27 To many, using
Street View was akin to being a
Peeping Tom. According to Edward A. Jurkevics, however, a
principal at the imagery consulting
firm Chesapeake Analytics, American courts consistently ruled
that people in public spaces

could be photographed. Kevin Bankston, a lawyer at a digital-
rights group, saw it both ways. “I
think that this product illustrates a tension between our First
Amendment right to document
public spaces around us, and the privacy interest people have as
they go about their day.” He
suggested that, to avoid privacy concerns, Google should blur
people’s faces.28
A double take on DoubleClick
DoubleClick was a company that served the Internet display-
advertising market that
provided Internet ad-serving services to agencies and marketers
and publishers who served major
corporations such as Microsoft, General Motors, and Coca-Cola.
PCMag.com defined ad serving
as “the hardware, software and personnel required to deliver
advertisements to Web sites and ad-
supported software. It also includes the monitoring of click-
throughs and required reporting to ad
purchasers and Web-site publishers.”29
25 Sam Knight, “All-seeing Google Street View prompts
privacy fears.” Times Online.com—Technology, June
1, 2007,
http://technology.timesonline.co.uk/tol/news/tech_and_web/arti
cle1870995.ece, (accessed October 31,
2008).
26 Melissa Lafsky, “Google Maps Project Manager Speaks Out

On Street View,” NYTimes.com, Freakonomics
Blog, June 5, 2007,
http://freakonomics.blogs.nytimes.com/2007/06/05/google-
maps-project-manager-speaks-out-
on-street-view/ (accessed October 10, 2008).
27 Helft.
28 Helft.
29 Definition of Ad Serving, PC Magazine online
(PCMAG.com), http://www.pcmag.com/encyclopedia_term/
0,2542,t=ad+serving&i=37491,00.asp# (accessed February 9,
2009).
-12- UV1354
In a deal that Eric Schmidt, Google CEO, characterized as
helping Google gain a
greater foothold in the display-advertising market, Google
announced its intention
to purchase DoubleClick in April 2007. DoubleClick CEO
David Rosenblatt told
BusinessWeek.com that the display-advertising market could be
even bigger than
the Internet-search market in the future.30 Google certainly had
faith in
Rosenblatt’s prediction, as it offered DoubleClick $3.1 billion

for the acquisition,
about 20 times DoubleClick’s annual revenues of $150 million.
(Normally a
company was worth about 10 times its annual revenues.) Google
wanted to get
into the display-advertising market to gain a foothold in the
market serving larger
players such as Time Warner, Sports Illustrated, and Friendster
with advertising
banners and videos, instead of the small-text ads for the much
smaller businesses
to which it currently catered. Google also wanted to beat
Microsoft and Yahoo!,
rival bidders who were all competing to become one-stop shops
for companies
that wanted to advertise on the Web. To achieve that goal, Net
players needed
more than a ton of traffic on their own on-line properties and
the ability to match
up tiny-text ads to search queries. They also needed to sell ads
on popular Web
sites beyond their borders and obtain more user information.31
While DoubleClick accepted Google’s offer, Microsoft, Yahoo!
and AT&T urged
government regulators to make sure the deal did not violate
privacy and antitrust laws. The
concerns of Google’s competitors over the merging of these two
very powerful data gatherers
were not unfounded. The Electronic Privacy Information Center
(EPIC), a consumer rights
advocate and public-interest research center based in
Washington, D.C., filed a complaint with
the U.S. Federal Trade Commission (FTC) just days after the

announcement of the merger,
claiming that the deal would “create a firm with access to more
information about consumers’
Internet activities than any other company in the world.”32 In
addition, the complaint read that
Google could operate with “virtually no legal obligations to
ensure the privacy, security, and
accuracy of the personal data that it collects.”33
In addition to opposing the merger, EPIC wanted Google to give
users the choice of
opting out of the collection of its search terms in connection
with its Internet protocol regarding
addresses. The EPIC also wanted both DoubleClick and Google
to destroy cookies that could
identify users and to make Google give people access to the
personal identifiable data the
company kept on them.
Google truly believed its DoubleClick acquisition would benefit
all Internet
constituencies worldwide by “making the Internet more efficient
for end-users, advertisers and
30 Catherine Holahan, “Google’s DoubleClick Strategic Move,”
Businessweek.com, April 14, 2007,
http://www.businessweek.com/technology/content/apr2007/tc20
070414_675511.htm (accessed September 24,
2008).
31 Holahan.

32 Holahan.
33 Ellen Nakashima, “Privacy Group Objects to DoubleClick
Deal,” Washington Post, April 20, 2007, D03.
-13- UV1354
publishers.”34 Google vaguely claimed in its blog that, as a
result of the acquisition, it would be
able to provide innovative ways to make information accessible,
relevant, and delivered quickly.
Google denied that its interest in DoubleClick was not
anticompetitive and prompted by
Microsoft’s interest. Instead, Google claimed it wanted to
promote “a vibrant, healthy market for
on-line advertising.”35
Later that morning
Alone in his office, Winber wondered exactly how he would or
could address the
problem, if it even was one. Should he talk to Charlie? What
would he even say? And what if
Charlie was not the one responsible for the pop-up ads? Would
he be offended or hurt? Even if
Charlie admitted to being HIV-positive, or to having AIDS, did
Winber have a responsibility to

reveal this information to his employees? As he contemplated
his choices, Winber silently cursed
the computer – and the internet – and the general lack of
privacy online – and angrily flicked at
few paper clips at the computer.
34 Donna Bogatin, “Google-DoubleClick Merger: Who Wins,
Who Loses.” ZDNet.com blogs, April 14, 2007.
http://blogs.zdnet.com/micro-markets/?p=1221.
35 Bogatin.
-14- UV1354
0
15
30
45
2004 2005 2006 2007 2008
Exhibit 1

Google Stock History in Dollars per Share (left axis) and
Millions of Shares Traded (right axis) with Selected Data
Date Open High Low Close Volume
20-Aug-04 100.00 109.08 95.96 108.31 33,780,500
31-Dec-04 189.15 199.88 189.10 192.79 26,500,800
1-Jul-05 298.90 309.25 289.22 291.25 79,460,100
30-Dec-05 431.86 431.86 413.74 414.86 28,353,600
30-Jun-06 406.75 419.33 401.01 419.33 24,285,000
29-Dec-06 456.52 468.58 454.59 460.48 11,981,200
29-Jun-07 528.98 534.99 519.46 522.70 27,786,600

28-Dec-07 694.99 716.00 693.06 702.53 9,663,600
27-Jun-08 545.36 557.80 515.09 528.07 23,537,700
Source: Created by case writer with data from Yahoo! Finance.
100
200
300
400
500
600
700
-15- UV1354
Exhibit 2
Google Line of Products and Services

Regarding its product development, Google emphasized “rapid
and continuous
innovation.” In releasing new technologies as works-in-
progress, Google made its products
available early in their development stages by posting them on
Google Labs, at test locations on-
line or directly on Google.com. If a product seemed worthy of
further development, Google
would “promote it to beta status for additional testing.” Test
periods could last a year or longer.
Once satisfied that a product was “of high quality and utility,”
Google would remove the beta
label.
Search
• Alerts
• Blog search
• Book search
• Catalogs
• Custom search engine
• Desktop
• Directory
• Earth
• Finance
• Gears
• Images
• Language tools
• Maps
• Personalized search
• Product search
• Scholar
• SketchUp
• Toolbar
• Web accelerator

• Web search
Ads
• AdSense
• AdWords
• Analytics
Applications
• Apps
• Blogger
• Calendar
• Checkout
• Code
• Docs and spreadsheets
• Gmail
• Groups
• Labs
• News
• Notebook
• orkut
• Pack
• Picasa
• Picasa Web albums
• Reader
• Talk
• Translate
• Video
• Webmaster tools
• YouTube
Enterprise
• Earth for Enterprise/
Google Earth Pro
• Maps for Enterprise

• Mini
• Search Appliance
• SketchUp Pro
Mobile
• Mobile
• Dodgeball
Source: http://www.google.com/press/descriptions.html.
-16- UV1354
Exhibit 3
Visual Representation of a Google Search
Source: Adapted from
http://www.google.com/corporate/tech.html.
1. User submits query via search engine

2. Computer connects with web server
3. Web server consults index server
4. Index server locates relevant documents
stored in document servers
5. Document servers share locations with
the user’s computer
Elapsed time: a fraction of a second!

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