The Google parent Alphabet Inc has complained that its business may be get in danger as a result of changing data privacy practices, new digital advertising polices and software that leak user information.
The company filed its annual report on Tuesday and added language that suggests it is adjusting to step up regulatory law and evolving consumer attitudes toward data and privacy online. The company wrote in the filing. “If we do not provide superior value or deliver advertisements efficiently and competitively, our reputation could be tarnished, we could see a decrease in revenue from advertisers and experience other adverse effects to our business.”
The data-collecting business models of companies like Google and Facebook Inc and the chance of tough regulations that undercut key revenue streams is increasing. Google has faced fines in Europe that has been able to pay with its massive cash hoard, but some privacy advocates and those concerned with the company’s sheer size are pushing for harsher policies.
Officials at internet has warned about stricter regulation and potential fines in the past thus 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.
Google found a software glitch in its Google Plus social network that could have exposed the personal data of as many as half a million people. The company decided to shut the service soon .Google also updated its warning about an expansion into non-advertising businesses like cloud services and consumer hardware.
These factors and the evolving nature of their business and historical revenue growth rate as well as historical operating margin may not be indicative of the business’ future performance.