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pterjan's diary



First, this post is about my current employer, Google, but this is my personal blog and the views expressed here are mine alone and not those of my employer.

I got quite upset this week while reading news about Google Street View and passwords recording, and few days before, about the tax issue. It is very frustrating that most of them are wrong (including major IT magazines) and very few talk about the real problems. Maybe this is generally true of all current media...

Reading Newspaper

First, about the tax question and the Slashdot news "How Google Avoided Paying $60 Billion In Taxes" that was the basis of various other articles.

It seems no one has read the link, starting with the news author. In brief, the original article states that most (88%) of Google non US sales are handled by Google Ireland, employing 2000 people in Dublin, and not paying taxes in the US because it is an Irish company, while the Google technology was mostly developped in the US. Then it says that because many US company do that, US loses $60 billion per year, in total, not just for Google.

Then there is a second part, about how taxes paid in Ireland are low by using some structure in Bermuda, which is more disappointing in my opinion but strangely people don't focus on that and many articles don't event mention it.

Why do no one read the original article before propagating the news everywhere?

Then the Street View issue. For those who did not follow, here is a summary.

Google Street View cars list WiFi AP and cellular networks while taking photos of the world. This is used by the geolocation service to tell you where you are based on the cells and AP that your phone sees.

Last Spring it was found that some code from an engineer's 20% project had been included in production code without checking what this code was doing. This code was sampling data from open WiFi networks to make statistics on the kind of data, and storing the data. When this was noticed, all the cars were stopped and Google made a public announcement (how many companies would have just erased it silently?).

The total amount of data is 600GB. This week it was announced that after some more analysis by one of the public entities (Google did not analyse or use the data, and waits to be able to delete it after everyone worked on it), some passwords have been found in some of the data fragments. Everyone is shocked that Google stole their password. Who can expect that in 600GB of random data from Internet their would be no password?

Why don't people worry that their neighbor has their passwords and can read their email and access their facebook private videos? They call an accidental collection of the broadcasted data an awful abuse, while I am sure many people already collect that data for doing bad things, just they don't announce it publicly.

Yes, Google should prevent unwanted storage of data, and is working on improving internal process about that, but the real problem is that the confidential data is there and anyone can access it. Why don't journalists use this event to explain people that they should secure their networks?

I feel that everyone is paranoid about Google and is very happy to publish anything, without even trying to check or understand the information.

Being worried about a company knowing that much about you is normal (and good), but that should not prevent journalists to address real concerns on that topics.

Between the time I wrote this and the time I published it, I found a tweet that can explain how many articles are written.

Today's TSUKKOMI(Total: 19) [Add a TSUKKOMI]
  Adam Williamson (2010-10-30 18:01)

"Then there is a second part, about how taxes paid in Ireland are low by using some structure in Bermuda, which is more disappointing in my opinion but strangely people don't focus on that and many articles don't event mention it.<br><br>Why do no one read the original article before propagating the news everywhere?"<br><br>The only reason Google has a major subsidiary in Ireland which handles so much of Google's business is because of the favourable tax situation, and Americans are pissed off about that. Of course, that begs the question of why, in the US, when a state or city breaks its own tax code to give a potential major employer a huge tax break, this is presented as a positive not a negative, because that's exactly the same situation: Ireland gives companies very favourable tax conditions in order to try and lure employers there.<br><br>On the Street View thing: okay, here's the deal. Remember when Mandrake broke people's CD drives? And we had a long internal justification about how it was caused by a patch we didn't write in the first place and it only happened because the firmware in the drives was really fucking stupid? No-one cared, because all that is inside baseball bullshit to them. All they care about is that Mandrake broke their CD drive.<br><br>This is exactly the same situation. We don't *care* that it's some engineer's 20% project. That's Google's internal business, no-one else gives a shit. The point is that the public impact of this whole situation is that Google (probably illegally) intercepted a whole bunch of private communications.<br><br>Why is it a bigger deal for Google to do this than our neighbors? That's Google's own fault, in fact. Google tries very hard to project an image of being this super-friendly company that's a force for good for everybody, and acts incredibly hurt every time anyone suggests that maybe it's not actually Mother fucking Teresa and is really just acting in its own interests. So when Google does stuff like this, or Eric Schmidt opens his mouth and inserts his foot again, people feel a lot more angry than they would if any other company did it, because of Google's own projected image (and also the fact that Google's in such a sensitive position, and innately requires people's trust).<br><br>Imagine if Red Hat went and did something really nasty with trademarks or licensing or something; people would be much more pissed off than if some proprietary company did it, because for them it's just par for the course and everyone more or less expects to get shafted all the time, but we project an image of being this heroic, principled open source company. Same deal. We benefit from that image, Google benefits from being the people's friend, but if you don't live up to your image, it _will_ come back to bite you.

  Pascal (2010-10-30 19:03)

Well I don't agree. If Google started to collect that data to use it, yes I would understand that people are upset, but even then, why no one would suggest to encrypt it?<br><br>In that case people are upset because Google announced that they accidentally collected it, did not use it, and want to erase it. And no one is reacting to the fact that anyone can, accidentally or not, access your password.

  DontBeEvil (2010-10-30 20:05)

Please explain to me how a Double Irish and a Dutch Sandwich (the tax dodging scheme mentioned in the original article), which lowers Google's effective tax rate to 2%, is not evil.<br><br>It's schemes like this which negate the good work that Google does, such as the $1 Billion endowment. It is easy to pledge other people's money.

  TheLittleBrother (2010-10-30 20:25)

"...I am sure many people already collect that data for doing bad things, just they don't announce it publicly"<br><br>And I'm sure the big G is collecting an awful lot of data... on such a commercial scale unavailable to that "many people" you're referring.

  aapgorilla (2010-10-31 12:14)

@DontBeEvil (2010-10-30 20:05) <br><br>"It's schemes like this which negate the good work that Google does, such as the $1 Billion endowment. It is easy to pledge other people's money."<br><br>It certainly is easy to pledge other peoples money, that's what politician do all the time, they use taxed money for this. Google actually earned THEIR money. It is THEIR money not the state's eventhough politician would love to get their greedy hands on it and tax it. <br><br>There is nothing wrong with dodging taxes, it's the same as lying to a robber when he asks you where all your valuables are and you do tell him where all your valuables are but just some.

  Adam Williamson (2010-10-31 19:33)

aapgorilla: the problem with that argument is that when you ask the employees of corporations who outsource their tax obligations whether they'd like to go and live in the countries where their profits are registered for tax purposes, they often appear mysteriously reluctant.

  aapgorilla (2010-10-31 20:44)

@Adam Williamson (2010-10-31 19:33),<br><br>And what is your point? I don't care for micro management of employer and employee that's solely the business of the respective employer and employee.

  Marmy (2010-11-01 13:27)

It is blind employee apathy like this that discourage me from using Google services.

  Pascal (2010-11-01 13:38)

@Marmy This post has no relation with me being an employee. I felt the same in Spring when the street view story happened, and I was not even thinking of interviewing there at that time.

  wobo (2010-11-03 16:51)

About the tax issue:<br>It's weird how people (especially true blooded US americans) react when they read about how a big company tries to minimize their tax obligations. At the same time all those same people spend lots of money to tax consultants to find ways to minimize their tax bills! That's true blooded hypocracy.<br><br>About Street View:<br>It is true that people were upset about Streetview while they themselves are giving away much more private data each day when shopping with credit cards, running unencrypted WiFi, etc.<br>The problem here is the already existing reputation of Google as a data mining kraken. Of course the media hyped it up and some politicians (here in Germany) tried to make some ground with this hype.<br><br>The problem with the gathered WiFi data was Google's fault, all right. They were very reluctant to cooperate with German authorities concerning such data and that resulted in even worse reputation.

  João Santos (2010-11-18 01:33)

Eric Schmidt said that the WiFi information would not be deleted.

  Pqscql (2010-11-18 01:36)

João: When did he say that? I only find articles where he says he is waiting to be allowed to do so

  Joe Buck (2010-11-18 02:23)

It is unethical for extremely profitable companies to use extreme accounting tricks to avoid paying taxes, because it forces countries to impose higher tax rates on those who can afford it less. The situation persists because Google, along with many other companies, employs lobbyists to keep Congress from getting rid of those loopholes. If a senator or representative doesn't go along, they lose campaign contributions and their opponents get campaign contributions. Thanks to a recent Supreme Court decision, corporations can now spend unlimited amounts of money to try to influence elections. This is evil. Google isn't being more evil than other companies, but it isn't being less evil either.

  Markus S. (2010-11-18 03:52)

The story was hyped because Google already has a bad track record when it comes to privacy. Google is one of the worst data collectors in the world, especially if one is careless and is always logged into Google. Then searches are saved, mails are read and processed, the user is tracked throughout the web via cookie-planting ads and Analytics, etc. pp.<br>Even without a Google ID, Google stores plenty of information about users without asking.<br><br>The admission of 'accidental' network data collection by a network technology expert is a) unbelievable and b) just the icing on top of Google's privacy cake. Every future 'accidental misstep' will be also be met with anger by many people of which some work for news media.<br><br>I wouldn't be surprised if some Google employees could just select a Google ID and get a detailed, automatically generated report about most frequent search terms, recurring mail topics, most visited pages, etc. along with the real name (GMail identity, Check-Out account,...) and now even the exact home location (via Google's shiny MAC Address database collected via Street View cars) -- naturally in all glory with map, satellite, and Street View imagery.<br>I don't care whether Google promises that no living person will ever read its users' mails. As long as Google maintains the right to "store and process personal data in order to improve its services" (last time I checked a paragraph like that sentence was still intact in at least one of Google's many 'TOS'/'Agreements'/...), such reports are possible.<br><br><br>PS:<br>AdamW: 'Imagine if Red Hat went and did something really nasty with trademarks or licensing or something'<br>You mean like ?

  Cyrille Berger (2010-11-18 09:14)

I have an other explanation at why people are upset at the "Google/others paying taxes in Ireland". Might be more for europeans than americans. Right now Ireland is in deep shit, they have a deficit of 32% to cover, and guess whose help they are going to ask to help cover it ? IMF and EU, which are funded by the tax paid in the other countries, instead of doing the right thing which would be to raise the taxes. There is a reason why US and other countries have taxes, it is to fund their government budget, this is something that Ireland has failed to do, and now they are asking money from the other countries, to whom they have "stolen" taxes by attracting companies with low taxes. That said, I personnally don't blame Google, they are just making the best of their options, nothing wrong or evil in that. I would rather blame the shortsighted Irish gouvrnement. And the excess of the ultraliberalism that allows incomes to be taxes in different places than where they are generated.<br><br>I do not know the law in the US, but in France, recording Wifi data is considered as piracy, so sure, people should secure their netwok, but that is no excuse for Google. But yes, I would agree that media are focusing on Google's fault, instead of balancing it with the good things that google did: public announcement and internal process improvements. But still, Google did commit a fault.

  Dean (2010-11-18 09:55)

Funny how many people are moaning about google dodging tax by handling some sales from a genuinely staffed office in a low tax state. Coca-Cola, Procter & Gamble, General Motors, Intel, FedEx are all (or at least were) registered in the Caymans, guess how many staff they employ there?

  Fri13 (2010-11-18 15:33)

I read the Google Tax thing from news paper and it was clearly written that Google does the typical job as most companies avoiding taxes and paying only 5% taxes from all the income.<br><br>And it was clearly said that in the US, the government loose the 60 billion dollars a year because companies does tax evasions.<br><br>If I remember correctly, it was just a billion what Google avoided from paying taxes. It is lots of money but far from the 60 billion.<br><br>The article went trough about the Google companies in different countries and how the money is transferred.<br><br>It really is very very sad that companies does not want to pay the full taxes and that the laws has holes what allows to make legal tax designs to minimize the amount of taxes.<br><br>[rant]<br>One big problem is as well with Canonical, what does not pay taxes at all, as it sits in the tax paradise in Isle of Man. Causing even bigger un-fair and un-balanced competition among Linux companies what are reliant from profit about their services. And it is sad because while Canonical is for-profit company and privat, it does not need to tell anything about its business. But at same time while Canonical is marketed and spoken as it would be very wealthy and profitable, people turns away from Mandriva, Novella and other companies because they are afraid that they would go to bankruptcy. And then smaller companies turns to Canonical's side without even knowing its financial status.[/rant]<br><br>If companies would have good moral and would follow the ethics, we would not have so terrible economical situations. It is the greed of the share holders what cause all the problems in the world. 10 years ago economy study books said that if company gets 5% profit from the product/service, it is very great amount. But now the study books says that you need to get 20% profit to get good amount. And still companies gets hundreds of prosents of profit. There just ain't limit for greed people and bigger group suffer always from that and are the ones who will pay the greed of the few people.<br><br>Think about the gain what US would get if US companies would pay the 60 billion dollars taxes to government? The US economy debit would get much smaller in 15 years (15*60 = 900 billion) as even the debit is 13 trillion, with that 60 billion a year US could actually start making more work and support their normal citizens, not the greed companies and shareholders.<br><br>Google is just one company among others, but it is doing evil thing, same way as many other company is doing.<br><br>And it is always funny how big company will get absolved big debts and economy crimes, but if one citizen can not pay 20 dollar dept, he/she is in big trouble and no one is going to help or give extra time to have a change to pay it back.<br><br>Greece, Ireland and many others are in big trouble because big companies (banks, international companies etc) and we all (whole world) are there to pay those mistakes, what ain't small but about billions and trillions.

  Fri13 (2010-11-18 15:42)

@Dean, If people talks about now Google's tax avoidance, it does not mean that people would not blame other companies as well. The problem just is, that people does not know statuses of those other companies.<br><br>There is no investigation journalism what would dig all the dirty things what corporations does. Media is just a puppet of the faceless big corporations and those who have more money or control for media, can control what people hear and what they talk about in daily purposes. <br><br>It is called a media control and there is no free speech or free media. Even the typical internet forums denies the free speech or does anything to bury the not-so-nice discussions with some kind excuse. Very typical thing.<br><br>And many forum members does it automatically without even itself understanding what they do by saying that those who gives credit, should give it directly to the companies what the critic is about. That is just totally wrong thing as the only thing what normal citizens has, is the freedom to discuss about the things, change their opinions in public. And those who locks down the forums or say that discussion should go to privat discussion, are just hiding the truth and denying the free speech from the people. <br><br>A very good example of the great function how citizens should act is in France, when government or companies or doing something what rips off the basic services etc, the citizens walks to the streets to express their opinions.<br><br>Those who there stand still and say "there is nothing to do" or "go to say it in privat for them" are as well counted as such what are being criticed. <br><br>We simply can not just start talking at every time from every company what avoids taxes. But neither we can not just talk about the one as it would be the only one.<br><br>

  xurfa (2010-11-19 15:04)

Google is used all around the world. I think it would be VERY bad if Google was paying taxes in the US only.