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Google Inc. (GOOG): France Privacy, U.S. Call Tracking

Google Inc.Google Inc. (NASDAQ:GOOG) is one of those massive online companies that has been in the sights of the privacy-rights patrol in the European Union over the last couple of years. Google Inc. (GOOG) is already facing privacy and antitrust issues by the entire economic bloc, but while the company is looking to launch a new call-tracking service for businesses involved in its AdWords Express platform, it is now having to answer to privacy concerns expressed by a member of the EU – with perhaps the entire Union following suit in the coming months.

France’s privacy regulatory agency, called CNIL, released a ruling this week that it had found that the privacy policy of Google Inc. (NASDAQ:GOOG) violates data-protection rules, stating that the company did not set any limits on the amount, types or uses of users’ personal information and it provided no reasonable opportunity for users to opt-out of the policy. CNIL chair Isabelle Falque-Pierrotin said that fines may be imposed by early 2013 if Google Inc. (NASDAQ:GOOG) does not modify its policy.

CNIL conducted the review upon request of EU regulators which have seen the ruling, and each of those countries may use this ruling as an opportunity to impose their own rulings or sanctions. One analyst of the issue stated that if Google Inc. (NASDAQ:GOOG) does not modify its policy – which the company had already changed this spring – it could face fines from the entire EU.

In a related note in terms of privacy and data protection, Google Inc. (NASDAQ:GOOG) is announcing the U.S. launch of a new phone call-tracking service for its AdWords Express for small businesses. This new feature had been used for two years by AdWords; this feature allows small businesses who use AdWords Express to gather analytical information about phone calls received based on ads placed with Google Inc. (NASDAQ:GOOG). Google would supply a toll-free number in place of the business number, and incoming calls to the toll-free number would be directed to the business’ local number, and Google Inc. (GOOG) would track those calls to determine efficacy of an ad.

How investors in Google Inc. (NASDAQ:GOOG) stock – like billionaire fund manager Julian Robertson of Tiger Management – will react to these news in the coming weeks and months as these shake out will be something to watch. Also, how will these news items affect the bottom line for Google Inc. (NASDAQ:GOOG)? Which one of these items might affect the company more?

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