internet of things, Google, Nest Labs and Privacy: Oxymoron?

Google and Nest Labs must preserve customer privacy, avoid urges to collect personal data for marketing and advertising purposes and use their $3.2 billion merger only to improve the use and value of home gadgets, a privacy expert told CMSWire.

"Will the companies have the ethical compass to restrain themselves from taking all of this data and combining it with all the other data Google has?" asked Rebecca Herold, information privacy, security and compliance consultant and president of Rebecca Herold & Associates. "Or will they use it and share it for reasons that have nothing to do with and are far beyond any stretch of the imagination that could be linked to, the devices’ original purposes?"

Nest on Privacy

Google's acquisition of the home digital thermostat and smoke-alarm-detector maker this week has stirred privacy concerns. Some people have called it a Google invasion into the home and another way to collect personal data online. Nest's Internet-connected devices detect people's behavior in the home.

Nest this week addressed the expected privacy concerns. In his company website FAQ, Nest co-founder Matt Rogers posed the question, "Will Nest customer data be shared with Google?"

Our privacy policy clearly limits the use of customer information to providing and improving Nest’s products and services. We’ve always taken privacy seriously, and this will not change."

In an interview with Reuters, Nest CEO and co-founder Tony Fadell said privacy was a big part of the discussion with Google leading up to the acquisition. "The reality of the situation is inside of Google they take privacy so incredibly seriously you have no idea," Fadell said.

Google declined commentary beyond its press release when approached by CMSWire. Nest also deferred to its company blog when CMSWire asked them about privacy today.

Home Gadgets or Data Mining? 

Still, many are convinced privacy will be an eventual concern with Google's presence in the homes via Nest technology.

Scott Strawn, an International Data Corporation (IDC) senior analyst who covers Google, told CMSWire that he finds it "totally impossible to believe" that Google will not use the acquisition at some point as a way to gather personal data.

It may not do so in the short-term, he said, but over some period of time. Privacy advocates, though, are quickly becoming aware of how much personal information people are willing to divulge in exchange for a great service.

"That's the point in many ways," Strawn said. "To be able to gather data — and not in nefarious ways — but for sound business reasons."

Forrester Research's Frank Gillett calls any belief Google's acquisition of Nest is about data a "misconception."

"This is about Google Now and helping get Google Now stronger at the right time," Gillett said.

The onus to protect individuals' privacy will also fall on the individuals themselves, who, Gillett added, "will have to be more explicit with their concerns."

Not Buying It

Still, there is good reason to be "very concerned," about privacy through the Google-Nest marriage, Herold said. 

"Google probably has more data about everyone’s online and online-connected activities than any other entity, possibly including the NSA," Herold said. "All their many repositories combined could already show most of everyone’s life details; at least those things that can be collected and posted online."

Before this week, however, Google did not have the potential lucrative data stream of people’s activities within their homes, Herold added. Their eating and drinking habits. Their daily routines. Whether they take showers or baths.

"What Nest is providing them is a very valuable, ever growing, repository of data exactly related to those types of activities," Herold said. "Nest will show the temperatures we keep our homes and when we make changes and also information about our smoke alarms."

Even more troublesome, Herold said, is the prospect of Nest making more products Google can capitalize on and use to gather data.

"Look for many more smart appliances to be created by them now with the Google acquisition, with all that additional money available to create new data collecting devices within homes; with cars and other locations likely to soon follow," Herold said. "Just as it stated in its press release this week, 'We will continue to reimagine and reinvent the unloved products that proliferate in our homes.'"

Privacy concerns have been a major theme on the Web since Google announced its acquisition

Google Energy?

Herold, who has led National Institute for Standards and Technology SGIP Smart Grid Privacy Subgroup since June 2009, is also concerned with Google’s now more active involvement within the energy management space.

"How long will it be before they are also trying to connect these devices to the smart grid or the smart meters or making their way into utilities?" she asked. "The ecosystem of the smart grid will be as massive and complex, if not more so, than our traditional Internet. Having Google in both technical environments is really a scary consideration from a privacy perspective when you start thinking about the technical capabilities this would provide to them."

Herold called the power of big data analytics on in-home activity data and online data "staggering" with what personal details can be revealed. And what if those analytics were shared with government agencies, insurance companies, marketers or financial organizations?

"Considering Google is a data-centric business that makes billions of dollars by monetizing the data they collect, it is unlikely the data from Nest will be limited to only the homeowner and those who directly support the devices," Herold said. "I would love to see Google prove me and the many others with similar privacy concerns wrong. That would be a great step forward in preserving privacy while supporting innovative home devices."

Title image by LanKS (Shutterstock).