Is $22.5 Million a Big Enough Penalty for Google?
It's the largest civil penalty the Federal Trade Commission has ever imposed for violating one of its orders.
But after the agency announced that Google will pay $22.5 million for overriding privacy settings in Apple's Safari browser, skeptics quickly criticized the penalty as little more than symbolic for a company that had $2.8 billion in earnings last quarter.
The Los Angeles Times called the settlement "a drop in the bucket [1]." CNN said it amounted to "financial wrist-slap [2]." Advocacy group Consumer Watchdog called it "woefully insufficient [3]," and in a statement of dissent, the FTC's Commissioner J. Thomas Rosch said it is "a de minimis amount [4] of Google's profit or revenues."
David Vladeck, who leads the agency's consumer protection bureau, defended the penalty. "$22.5 million may not seem like a lot of money to Google," he said in a conference call with reporters last week. "But we think it's quite a substantial civil penalty ... We hope this sends a clear message."
We dug up some numbers for comparison to the Google penalty:
It's 0.1 percent of Google CEO Larry Page's net worth, according to Forbes [5].
It would take about five hours for the company to bring in that amount, based on sales [6] from the most recent quarter.
It's less than the gain Google's stock saw Thursday, the day the FTC announced the settlement. Google added [7] $39.2 million to its market capitalization that day.
The penalty is large by FTC standards, but other regulatory bodies recently have imposed much larger consumer protection fines:
http://www.propublica.org/article/is-22.5-million-a-big-enough-penalty-for-google
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