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Google Agrees to $391.5 Million Privacy Settlement With 40 States

The company will change its location tracking disclosures in 2023.

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Google's consumer privacy settlement is the largest of its kind by states in US history.
James Martin/CNET

Google has agreed to pay $391.5 million in a privacy settlement with 40 state attorneys general over its location tracking practices, according to Oregon's Department of Justice on Monday.

The agreement is the largest consumer privacy settlement by states in US history. States argued that the search giant misled people into thinking they had turned off proximity-based data collection when the company continued to allocate that information. Google agreed to improve its location tracking disclosures starting in 2023.

"For years Google has prioritized profit over their users' privacy," Oregon Attorney General Ellen Rosenblum said in a release. "They have been crafty and deceptive. Consumers thought they had turned off their location tracking features on Google, but the company continued to secretly record their movements and use that information for advertisers."

Google's policy communications manager José Castañeda said, "Consistent with improvements we've made in recent years, we have settled this investigation which was based on outdated product policies that we changed years ago." 

The settlement comes as governments around the world are using lawsuits and legislation to rein in Big Tech. In 2018, the European Union put the General Data Protection Regulation, or GDPR, into law. Earlier this year, Facebook parent Meta was fined $400 million for failing to protect children's privacy on Instagram. Google and Meta were also fined $237 million in France over user tracking in January. In India, Google was hit with a $113 million fine over its app store payment practices. As these fines have piled up, Google has more actively been saying it protects people's privacy, and it has implemented new security tech on its Pixel 7 smartphone. Apple has increasingly marketed itself as privacy focused, though it too uses Google as its primary search platform on iPhone.

The US Department of Justice plans to file a lawsuit later this year regarding Google's search dominance, and both Washington state and Washington, DC, sued Google in September over location tracking.

Google primarily makes its money from digital ad sales. Connecting advertisers to customers requires information about search interest, buying behavior and location. Google posted a 3% fall in ad revenue between the second and third quarters of this year.

An Associated Press investigation from 2018 uncovered Google's tracking practices which showed the company pulling in data even if people turned off location history. At the time, Google said it informed people when turning off location history that location data would still be used to improve user experience, for example, when doing a search or looking up driving directions.

The settlement requires Google to show people more information when they turn location services on or off, to not hide information regarding location tracking, and to give users detailed information about the types of location data being collected.