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Apple and Google Are at War Over Privacy (Premium)

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Apple and Google are both terrible in their own ways. But while one has the upper hand when it comes to marketing privacy, that won’t help it win this war.

As you may recall, Google CEO Sundar Pichai made a big push for privacy and trust during his Google I/O keynote address earlier this month. But on the eve of that address, Pichai also wrote an op-ed for The New York Times in a bid to reach a wider audience. It’s worth reading, and it hits on a topic I’ve raised repeatedly: While people probably believe that the notion of “trusting Google” is inherently ludicrous, most people, in fact, do trust Google. They don’t just use Google apps and services like Maps, Gmail, Photos, and Search. They rely on them.

But there’s a dark side to Google, of course, and we’ve all experienced it. You and your spouse, or a friend, or whomever, are discussing some random topic out loud, in private or in public, and that thing you’re discussing magically begins appearing in ads you view online or on your phone. Most people, having observed this phenomenon, remark on the creepiness of it. And then go right back to using the same Google apps and services they’ve always used without even once considering investigating what they can do to stem the invisible tracking in which Google engages to make this happen.

There’s a psychology to this behavior, a reason why we collectively do nothing to help ourselves when it comes to privacy. But that can wait for a later day: For now, let’s examine the interesting and passive-aggressive ways in which Google and Apple are engaging in a war of words. Without really addressing the other company while they argue.

(Microsoft used to do with Apple back when Steve Jobs had returned to the company and was turning that business around; the theory was that you never named the enemy because doing so would only give it the attention it wanted.)

The title of Pichai’s op-ed piece provides our first hint that Google’s new marketing of trust and privacy is really about Apple, and about stealing away Apple’s moral superiority: “Privacy Should Not Be a Luxury Good.”

“Privacy cannot be a luxury good offered only to people who can afford to buy premium products and services,” he writes. “Privacy must be equally available to everyone in the world.”

Those comments clearly allude to Apple. Less obviously, they vaguely address the different business models employed by the two companies.

That is, Apple is essentially marketing the fact that your purchase of expensive devices will provide you with Apple’s privacy protections. It’s like Mercedes or Volvo marketing the advanced safety features in their vehicles, features which are not yet available to the sweaty masses driving Fords, Toyotas, and Hyundais.

Google, meanwhile, understands that not everyone can afford an iPhone or the tsunami of services that Apple for which is now charging its audience. So, it offers a different model where its customers implicitly give up a bit of their privacy in order to access services for free. Those advanced safety features, after all, eventually do make their way from the luxury car market to more pedestrian vehicles that cost a lot less. Even better, Apple’s over-emphasis on privacy means that its own offerings can’t be as sophisticated as Google’s because Apple just doesn’t know as much about its users. Think about the differences between Apple’s dimwitted Siri and Google’s all-powerful Assistant.

These different business models are well understood, but Google also knows that it needs to shift the balance between customers and advertisers to be a bit more customer-friendly in order to escape the wrath of antitrust regulators. So, part of this month’s push in the NYT and at Google I/O was feeling out how many controls it can offer consumers without usurping its business model.

What’s perhaps more interesting is that Apple has responded to Pichai’s charges.

“Privacy considerations are at the beginning of the process, not the end,” Apple senior vice president Craig Federighi told The Independent in a recent interview. “When we talk about building the product, among the first questions that come out is: how are we going to manage this customer data?”

Federighi describes the differences between Apple’s model and Google’s in both business and moral terms.

“We have no interest in learning all about you … we think your device should personalize itself to you,” he said. “But that’s in your control that’s not about Apple learning about you, we have no incentive to do it. And morally, we have no desire to do it. And that’s fundamentally a different position than I think many, many other companies are in.”

And there it is.

In the same way that Google’s Pichai mentioned Apple without actually mentioning Apple, Apple’s Federighi mentioned Google without actually doing so.

(Yes, he could be alluding to other privacy disasters like Facebook as well. But while Apple may institutionally dislike Facebook, it doesn’t compete directly with the social network.)

The word “privacy” appears over 50 times in the Independent interview. And when the publication formally asked Federighi about the Pichai dig, he responded directly as well.

A lot.

“I don’t buy into the luxury good dig,” he said. “On the one hand, it’s gratifying that other companies in this space seem to be making a lot of positive noises about caring about privacy. I think it’s a deeper issue than what a couple of months and a couple of press releases would make. I think you’ve got to look fundamentally at company cultures and values and business model. And those don’t change overnight.”

On the face of things, those are fair charges. As I noted above, Google’s business model is predicated on violating user privacy as much as possible to feed its vast advertising empire. But Apple’s business model, to date, has been about fleecing its best customers on an ongoing basis by driving ever-more-expensive hardware upgrades on an annual or biennial basis. Now that that model is faltering, however, the firm is turning to services to make up the difference. Paid services.

“We certainly seek to both set a great example for the world to show what’s possible, to raise people’s expectations about what they should expect of products, whether they get them from us or from other people,” he says, somewhat addressing the fact that Apple’s hardware products are very, very expensive. “And of course, we love, ultimately, to sell Apple products to everyone we possibly could – certainly not just a luxury.”

We don’t have to do too much research here to understand that Apple only plays in the premium space of each market in which it competes. It’s cheapest new iPhone is half again as expensive as Google’s, for example.

“We think a great product experience is something everyone should have,” he says. “So, we aspire to develop those.”

The non-one-percenters in the audience will have to wait for Apple’s aspirations to bear fruit in the low-end of the market. But I recommend not holding your breath.

Back to privacy, Federighi also addresses criticisms that Apple’s products and services cannot be as good as Google’s because the firm is so hands-off with user data.

“We’re pretty proud that we are able to deliver the best experiences, we think in the industry, without creating this false trade-off that to get a good experience, you need to give up your privacy,” he said. “And so we challenge ourselves to do that sometimes that’s extra work. But that’s worth it. It’s a fun problem to solve.”

Regardless of the platitudes, Apple is absolutely at a disadvantage compared to Google and other firms when it comes to the sophistication of its offerings. But Apple’s marketing message is a good one, and it is smart to market privacy and wield it as a weapon against its competitors. The success of Apple Health, for example, rides in part on the belief of its users that Apple will protect their most private of private data.

That said, I can’t help but think that many buy an iPhone or another Apple device in part because of the firm’s privacy stance and then just use it with Google services, oblivious to the hypocrisy. Apple won’t prevent that, can’t prevent that, but that won’t stop the firm from claiming the moral high ground.

“Fundamentally, we view the centralization of personalized information as a threat, whether it’s in Apple’s hands or anyone else’s hands,” he continued. “We don’t think that security alone in the server world is an adequate protection for privacy over the long haul. And so the way to manage to ultimately defend user privacy is to make sure that you’ve never collected and centralized the data in the first place. And so, we every place we possibly can we build that into our architectures from the outset.”

What I keep coming back to as I consider these differing viewpoints is that Apple’s model feels aspirational but impossible, that there is an inevitable brick wall that occurs when you refuse to mine user data, even with their consent. Meanwhile, Google’s model is terrible and troubling and yet highly effective. When I’m driving between, say, Philadelphia and Boston and Google Maps alerts me to a speed trap or redirects me to a side-road to avoid an accident and the resulting slowdown, I feel pretty good about that relationship. And this will work regardless of which type of phone I choose. Which, ultimately, is the problem for Apple.

Put another way, I like Apple’s message. But I choose Google’s products and services. Because getting the thing done as efficiently as possible outweighs the platitudes. No matter what I think of Google and its business practices.

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