Google Privacy Issues in France: Much To-Do About Nothing

NEW YORK ( TheStreet) -- Two weeks ago, I wrote No Google Deed Goes Unpunished: Opinion, an article about European regulators' new demands on Google ( GOOG).

On a continuous basis, European regulators demonstrate they are like mosquitoes. They're small, insignificant bloodsuckers, but annoying as hell.

Today's latest annoyance comes from France. France is now threatening Google with fines because of the search engine's intelligent use of interaction data.

Privacy issues are nothing new; however, I find it astonishing that the focus and attention is usually on companies and not the government.

For years, I've watched groups voice their opposition to corporate data mining, and yet, until the recent NSA exposure, we almost never hear a peep about government's big brother activities.

Does anyone else wonder whether some company protests are meant to be a distraction away from governments' shenanigans? I don't have the answer to that question. I do, however, know what concerns me most.

There is a significant difference between government and corporate data mining. A corporation's purpose is to lower its marketing costs; the government's purpose is to spy on you. Corporations don't use the information against you, and the collection has social benefits. On the other hand, the government can use the data to destroy you.

You likely have already noticed that if you perform a Google search on any given subject, you're almost assured to see relevant ads while visiting various Web sites. Knowing what you're interested in better than other search engines is what makes Google popular and profitable.

Microsoft's ( MSFT) Bing and Yahoo! ( YHOO) are set up to collect data too, although Google is much better at the entire process.

Google understands that if it makes it easy for small Web sites to buy and sell ads, Google can place the right ads in the right locations. The concept isn't all that complicated. Why Yahoo!, Bing, and others haven't created similar networks is difficult to understand. At some time in the future, other search engines will figure it out, but in the meantime, the money left on the table is for Google to collect.

As I stated previously, Google isn't the only beneficiary. Online and retail sellers from Wal-Mart ( WMT) to the smallest Web sites depend on the efficiency of Google's ad placement algorithms to keep their marketing costs as low as possible. This is especially true for small businesses that don't have the resources to target ads in house.

If regulators want to hurt small businesses, it's hard to find a more efficient method than to increase their cost and lower the ability to acquire new customers.

Without the benefits of efficient ad targeting, businesses will waste a greater percentage of their marketing budget and resources. For consumers, it means seeing useless and irrelevant ads instead of appropriate and relevant ones.

I believe consumers should have the right to opt out, but for the reasons stated, I'm not going to.

At the time of publication, Weinstein held no positions in stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
Robert Weinstein currently blogs, mentors traders, and writes several weekly columns in Rocco Pendola's Option Investing newsletter from his home in northern Wisconsin. Robert tends to focus on the psychological importance of goals, risk mitigation, emotion, and relatively short term market exposure. With nearly 30 years of studying and investing experience, Robert has experienced the many ups and downs in the financial markets and uses the knowledge gained to maintain balance. Robert believes the best way to make money investing is to avoid losing it. The best way to avoid losing is to know what emotional traps lay in the path of investors and learning how to avoid them. Robert is a voracious reader of financial related books often completing more than one book a week while not trading or writing. Robert contributes to his blog at on a regular basis with an emphasis on studying behavior finance.