In order to do things like compute the PageRank of visited Web pages or list Related Web Pages, the Google Toolbar sends the URLs of Web pages that users view to Google's servers. The Google Toolbar does so only after the user allows this data to be sent.
But the Google Toolbar turns out to be less attentive to users who seek to disable page tracking. Though a user may choose to disable the Enhanced Features that prompt Web page tracking, the Google Toolbar does not respond, at least until the user restarts his or her browser.
"I'm reminded of The Eagles' Hotel California," muses Edelman in his report. "'You can check out anytime you like, but you can never leave.'"
Edelman acknowledges in a disclosure statement that he has served as a consultant for Google's competitors and has litigated against the company on behalf of plaintiffs. But such relationships, though invariably mentioned by Google representatives, do not change the validity of his findings.
Indeed, Google has acknowledged that its Toolbar wasn't working as it should have been and has issued fix.
"To be clear, this is only an issue until a user restarts the browser, and it only affects the currently open tabs for a small number of users," said a Google spokesperson in an e-mailed statement. "Specifically it affects those using Google Toolbar versions 6.3.911.1819 through 6.4.1311.42 in Internet Explorer, with enhanced features enabled, who chose to disable Toolbar without uninstalling it. Once the user restarts the browser, the issue is no longer present. A fix that doesn't require a browser restart is now available on www.google.com/toolbar and in an automatic update to Google Toolbar that we are starting tomorrow."
Google has become more attentive to privacy issues in the past two years as critics have increasingly depicted the company's appetite for data as a threat.
While Google's popularity suggests that the majority of users trust the company and aren't all that worried about potential privacy risks, competitors nonetheless see online privacy as a point of differentiation.
Search engine Ixquick, for example, plans later this week to introduce a way to browse Web sites privately, using a proxy service, to complement its search service that does not track users.
Online application provider and storage service TransMedia recently changed the default search engine in its Glide OS service from Google to Bing as a show of support for Microsoft's data retention period reduction and promised not to use user data for targeted advertising. The company is also looking into a new legal structure for cloud computing that offers users stronger privacy protection.
Whether privacy moves beyond being something that's theoretically desirable but sacrificed for convenience or discounts remains to be seen. Past efforts to sell privacy as a consumer service failed because the market wasn't there. Moreover, the ongoing success of services like Facebook suggests that sharing trumps privacy.