Newly unredacted documents in a lawsuit against Google reveal that the company’s own executives and engineers knew just how difficult the company had made it for smartphone users to keep their location data private.
Google continued collecting location data even when users turned off various location-sharing settings, made popular privacy settings harder to find, and even pressured LG and other phone makers into hiding settings precisely because users liked them, according to the documents.
Jack Menzel, a former vice president overseeing Google Maps, admitted during a deposition that the only way Google wouldn’t be able to figure out a user’s home and work locations is if that person intentionally threw Google off the trail by setting their home and work addresses as some other random locations.
Jen Chai, a Google senior product manager in charge of location services, didn’t know how the company’s complex web of privacy settings interacted with each other, according to the documents.
Google and LG did not respond to requests for comment on this story.
A judge ordered new sections of the documents to be unredacted last week in response to a request by trade groups Digital Content Next and News Media Alliance, which argued that it was in the public’s interest to know and that Google was using its legal resources to suppress scrutiny of its data collection practices.
The unsealed versions of the documents paint an even more detailed picture of how Google obscured its data collection techniques, confusing not just its users but also its own employees.
Google uses a variety of avenues to collect user location data, according to the documents, including WiFi and even third-party apps not affiliated with Google, forcing users to share their data in order to use those apps or, in some cases, even connect their phones to WiFi.
“So there is no way to give a third party app your location and not Google?” one employee said, according to the documents, adding: “This doesn’t sound like something we would want on the front page of the [New York Times].”
When Google tested versions of its Android operating system that made privacy settings easier to find, users took advantage of them, which Google viewed as a “problem,” according to the documents. To solve that problem, Google then sought to bury those settings deeper within the settings menu.
Google also tried to convince smartphone makers to hide location settings “through active misrepresentations and/or concealment, suppression, or omission of facts” – that is, data Google had showing that users were using those settings – “in order to assuage [manufacturers’] privacy concerns.”
Google employees appeared to recognize that users were frustrated by the company’s aggressive data collection practices, potentially hurting its business.
“Fail #2: *I* should be able to get *my* location on *my* phone without sharing that information with Google,” one employee said.
“This may be how Apple is eating our lunch,” they added, saying Apple was “much more likely” to let users take advantage of location-based apps and services on their phones without sharing the data with Apple.
When WarnerMedia executives sold to AT&T in 2018, their company stock converted to AT&T shares. Those shares are worth less today ($29.52) than they were on the day the deal was consummated ($32.60), while Disney shares recently have doubled in value on its growth in streaming subscribers.
“It was a disaster,” one person familiar with the history said. “It is a horribly performing stock. It is a deep disappointment the way it worked out.”
As Apple put the squeeze on ad tracking, it rolled out its own new ad format, Suggested Apps, to help developers get their apps discovered.
But advertisers told Lara O’Reilly that the ads were expensive and hadn’t delivered meaningful results.
Thomas Petit, a growth-marketing consultant, said in testing of Apple’s search-tab campaigns, the cost per installations was up to triple-digit percentages higher than Apple’s preexisting search-ads product.
It’s still early days, but if the new format was meant to be a panacea for advertisers who are now having a harder time zapping ads to people on Apple devices, it hasn’t worked out that way just yet.
Efforts to help advertisers avoid misinformation are gathering steam.
Publicis is the latest big ad holding company to use NewsGuard’s tool to keep ads off shady websites, after IPG and Omnicom.
NewsGuard shared a case study with Tanya Dua showing that for one advertiser, using its tool lowered the cost of its ads while making them more efficient – suggesting that staying off shady sites isn’t just good for brands’ image, it could also be good for business.
But the automated nature of programmatic advertising means advertisers can still wind up on shady sites. And some brands also pull ads in response to breaking news or avoid entire categories of sites, which can harm legit news publishers.
Alphabet announced its first-quarter earnings Tuesday, blowing past Wall Street’s expectations as the company’s ad business continues to see strong growth following a pandemic slump last year.
Google’s parent company brought in $45.6 billion in revenue for the quarter, minus traffic acquisition costs, versus $42.48 billion expected by analysts. Alphabet’s revenue jumped 35.3% from $33.7 billion in the same quarter a year ago.
Google Cloud brought $4.02 billion in revenue and had an operating loss of $974 million in Q1, versus $3.99 billion in revenue expected by analysts. That’s compared to $3.83 billion in revenue and $1.24 billion in operating losses during Q4 2020, the first time Google broke out its cloud business’ performance separately.
Google’s ad business also continued to rebound, following its first-ever revenue decline in Q2 2020, as advertisers reallocate their budgets back toward Google’s platforms, especially YouTube, which brought in $6.01 billion in revenue during Q1 2021.
Meanwhile, Alphabet’s “other bets,” which include Verily, Waymo, and other Alphabet businesses, reported revenue of $198 million against an operating loss of $1.15 billion, compared to analyst expectations of $1.21 billion in operating losses.
Alphabet also announced plans to buy back $50 billion of its Class C stock. The company’s stock was up more than 4% in after-hours trading.
Here’s what Alphabet reported, compared to what analysts expected, according to Bloomberg.
Total revenue: $55.3 billion (Expected $51.61 billion)
Earnings per share: $26.29 per share, adjusted (Expected $15.65)
Google Cloud revenue: $4.02 billion (Expected $3.99 billion)
YouTube ads revenue: $6.01 billion
Google’s earnings report comes as the digital advertising market has seen substantial growth over the past two quarters, though the company sent shockwaves through the industry by announcing last month that it will no longer track individual users online, which could upend how adtech companies do business.
But some experts previously told Insider’s Isobel Asher Hamilton that the move may be a clever ploy by Google to further entrench its dominance of the digital ads market – a dominance that has invited increasing antitrust scrutiny, including three separate federal lawsuits, that could mean regulatory headwinds for Google down the road.
Australian lawmakers have portrayed the proposed law as an effort to curb the tech giants’ power over digital advertising (a major cause of news publishers’ declining revenues over the past two decades). Facebook argued that the law misunderstands its relationship with publishers.
But the situation is more complicated than an attempt to level the digital media playing field – and it could have consequences around the world.
Here’s what you need to know about the battle between Australia, Facebook, and Google over who pays for news online.
How did we get here?
News publishers have long had a bone to pick with companies like Facebook and Google, blaming them for eating away at ad revenues (and as a result, journalism jobs), while also exercising massive control over publishers through algorithms and benefitting from showing their users news content without paying its creators.
Increasingly, regulators have sought to force Facebook and Google to pay publishers to use their content, and Australia has been at the forefront, along with the EU and countries including France, Germany, and Spain.
The law as currently proposed would require companies like Facebook and Google to pay Australian publishers directly for news content that’s displayed or linked to on their sites, as well as give publishers 28 days’ notice before changing their algorithms.
Specifically, it would require them to individually negotiate content prices with publishers within three months, or be forced into an arbitration process where a government-appointed panel will pick between the publisher and tech giants’ proposals.
Is it likely to pass?
Yes. The lower chamber of Australia’s parliament approved the proposed legislation this week, and it’s now headed to the Senate, where it’s expected to pass into law, though discussions between the companies and the government are still ongoing.
Who would be the likely winners and losers?
As the Syndey Morning Herald reported, smaller publishers are not eligible for payments under the proposed law, so large publishers like News Corp may end up benefitting the most. (News Corp has urged the Australian government to pass the law).
Reporter Casey Newton also pointed out that the law also doesn’t require publishers to spend any new revenue on reporters or newsgathering efforts, meaning it could go to executives or investors.
Facebook’s and Google’s competitors could also gain an edge if their market share is diminished – Microsoft President Brad Smith endorsed the law last week.
As a result, the law could inadvertently further entrench Facebook’s and Google’s dominance, though it’s unclear what the ultimate impact would be on news publishers or the broader media ecosystem.
What was Facebook’s response?
Facebook said in a blog post that the law “fundamentally misunderstands” its relationship with publishers – which it argued benefits publishers more. Facebook said news content is “less than 4% of the content people see” and that it brought in around $315 million for Australian publishers in 2020.
With less to lose, in its view, Facebook pulled the plug.
On Wednesday (Thursday in Australia), Facebook blocked Australian publishers from sharing or posting content from their pages, blocked Australian users from viewing any news content at all (even from international publishers), and blocked all users worldwide from viewing content from Australian publishers.
Alphabet subsidiary Google, which arguably has a more even exchange of value with news publishers, has fought aggressively against the proposed law. In January, the company came under fire for hiding some Australian news sites from its search results.
Not only will these changes wipe out how marketers aim ads at people, it’ll force them to change how they measure ads and attribute them to sales.
Adtech companies like The Trade Desk and LiveRamp are hard at work trying to replace the cookie, but the risk is that having a hodgepodge of solutions sows more confusion.
The thing to watch will be if marketers all line up and adopt a universal replacement for the cookie – and if they move further into the arms of the big platforms, whose dominance over digital advertising has only grown in the pandemic.
The TV market has been rocked this year with big players like Apple TV Plus and CBS All Access banding together to attract audiences, Roku and Amazon aggregating streaming content, and new entrants like Disney Plus and Discovery Plus jumping into the streaming fray.
Ashley Rodriguez has six big takeaways from a UBS TV report looking out at the industry over the next 10 years. Here’s a taste:
The next five years will be a “land grab” phase where people may experiment with multiple services, but it will be followed by a period of consolidation.
Netflix and Disney Plus are best positioned to gain in the near term because of their premium content, pricing power, technology, and economic positions.
While we’ve already seen Quibi fold, the analysts also see smaller and local players like AMC Networks in the US, Atresmedia in Spain, and News Corp. struggling more.
WarnerMedia is under attack from all sides after it decided to release all its 2021 movies on streaming at the same time as theaters, which Hollywood fears will jeopardize revenue it’s historically counted on.
Travis Clark broke down the backlash:
While movie studios have experimented with alternatives to theaters amid the pandemic, like premium video-on-demand and streaming, Warner Bros.’ plan is certainly the most disruptive one yet.
The key points:
Many actors and filmmakers are concerned they won’t get the same payday they’d get from box-office returns.
People have been trained by streaming services to get content when and where they want it, WarnerMedia is trying to sell its plan’s predictability at a time when it’s anyone’s guess when people will feel comfortable going back to the movies.