Google: Data privacy changes could hurt

Google parent Alphabet warned its business may be damaged by changing data privacy practices, new digital advertising polices and software bugs that leak user information.

The company filed its annual report Tuesday and added language that suggests it’s adjusting to increased regulatory scrutiny and evolving consumer attitudes toward data and privacy online.

“Changes to our data privacy practices, as well as changes to third-party advertising policies or practices may affect the type of ads and/or manner of advertising that we are able to provide which could have an adverse effect on our business,” the company wrote in the filing.

“If we do not provide superior value or deliver advertisements efficiently and competitively, our reputation could be affected, we could see a decrease in revenue from advertisers and/or experience other adverse effects to our business,” it added.

As consumers and politicians re-evaluate the datacollecting business models of companies like Google and Facebook, the chance of tough regulations that undercut key revenue streams is increasing.

To date, Google mostly has faced fines in Europe that it has been able to pay with its massive cash hoard, but some privacy advocates are pushing for harsher policies.

The internet giant has warned about stricter regulation and potential fines in the past. And regulatory filings like Tuesday’s annual report are often filled with boilerplate descriptions of risk so companies aren’t sued by investors if something actually goes wrong. Still, when new language appears, investors and analysts take note.