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August 24th, 2011 COREY PEIN | News Stories
 

Sticker Shocker

This Google window decal will talk to your phone. Next, Google wants your phone to tell all about you.

news3-google_3742NEXT WAVE: If you’ve shelled out for the latest smartphone, tapping your device to one of these Google stickers could transmit information about the business. - IMAGE: Darryl James
They came in the mail, thousands upon thousands. And Portland businesses have obediently applied them to their windows: white stickers, the size of a pulp novel, with the distinctive red pinpoint icon of Google Maps.

The stickers advertise one of the Internet giant’s newest services-, Google Places. Portland is the first test city for Places, which is like an online Yellow Pages that’s updated by users and is free (for now) to businesses that want a listing. 

What most passersby—and some retailers—don’t know is that the Google stickers contain a tiny chip that can send a signal to the latest smartphones. It’s the same technology used in new U.S. passports and by farmers for “electronic sheep identification.”

Google and other corporations are investing heavily in this technology, known as radio-frequency identification or RFID, which they bill as the future of commerce. The Google stickers can be activated by the company’s new Nexus S Android phones; the iPhone 5 and other next-generation smartphones should also work.

WW tested a sticker with a Nexus phone. Tapping the phone to the sticker made the screen flash with the appropriate Google Places page.

Which seems cool. But for some consumer and privacy advocates, the chips represent something troubling—“the most terrifying thing that Google has unleashed on the public,” says Paul Wagner, founder of Forkfly.com, a local restaurant listings site. 

The technology could bring together three of the Internet giant’s products: One is Google Offers, its clone of Groupon, the popular “daily deals” site offering discounts at local businesses [See “Cheat Local!,” WW, August 17, 2011]. Another is Google Places, which helps people locate and rate businesses.

The third—which is so new the company won’t talk about it with us—is Google Wallet. This service will allow you to buy things in stores with your phone, and will let Google take a cut of the sale. 

A Google spokesperson didn’t answer WW’s questions about Wallet. But Stephanie Tilenius, Google’s vice president of commerce, offered some details at a May industry presentation. 

“I go to the grocery store, [the phone] welcomes me,” Tilenius said. “I’ve given my phone permission to know where I’m at. Up pops my shopping list, based on what I usually buy at the grocery store. A notification pops up that there’s this great apple pie that I love, that I can get $1 off of it in aisle 8…. When I check out, I tap to pay…and I get a receipt on my phone.”

Tilenius left out key details. First, the Google Wallet processing fee.* Second, it’s not clear what information about your tastes and habits Google will share with its other services, such as Gmail. 

While Portland serves as Google’s sandbox, Amazon, Apple, Microsoft, Facebook and other big tech companies are testing similar strategies elsewhere. “The thing that makes Google stand out,” says Harley Geiger of the Washington, D.C.-based Center for Democracy and Technology says, “is that Google has so many other applications that people find useful in their everyday lives, and which collect vast amounts of information about people.”

Geiger says federal law doesn’t cover the possibilities created by new technologies. 

“It is very likely that in the future—probably not at the outset—using your phone for payments is going to disclose considerably more information than using your credit card does today,” Geiger says. “The issue is what is disclosed and whether the consumer has control.” 

Google could send ads to your phone based on whom you’ve emailed, the content of your emails, and where you happen to be standing.

Many new cash registers come with Google-friendly RFID built in, whether the merchant wants it or not. Several local businesses told WW they were already cautious about how much influence Google has over their businesses. An ongoing Federal Trade Commission antitrust probe is examining whether Google’s search results are rigged to favor advertisers and Google’s own services. “Top to bottom, they’re figuring out a way to own the entire consumer space,” Forkfly’s Wagner says.

That’s not the story Google tells. “A lot of businesses know and love the Google brand,” spokeswoman Jeannie Hornung says.

Why else would they put its stickers in their windows?

Update: Google spokesperson Jeannie Hornung says the company "will not take a cut of the purchase price or transaction fees for purchases made through Google Wallet," per this FAQ. However, there's no reason the company couldn't later change its mind, like any other financial services provider.

 
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