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Privacy in a Virtual World

Kvatch, the amphibious proprietor of Blognonymous, hit upon an article from The Register that discussed Google's work on a software that would allow your computer to "listen" for auditory cues and then present ads relevant to whatever it picks up in the background (such as something on your TV). This issue was a revisit for me (I had already blogged about the BBC's cursory reportage some two months ago). But I felt that this technology deserved further scrutiny, especially after a comment from Kvatch garnered this response from me:
And perhaps at some point in the not too distance future, to "Google" someone may come to have rather nerfarious [sic] implications.

Now aside from the fact that I apparently don't know how to spell the word nefarious, the more I mulled this through my brain, the more I began to realize how eerily close we already are to just such a reality. Google has grown exponentially since its inception. We have come to rely on their search engine to find all kinds of information. It was this prominence that lead to Google being added to the dictionary. According to Merriam-Webster, "google" has the following definition (emphasis added):
to use the Google search engine to obtain information about (as a person) on the World Wide Web.

Consider that for a minute. To "google" someone often means to look up information about that person on the Internet. Does anyone else find this rather disconcerting?

We have become a digitized society. Whole aspects of our lives are being recorded and stored on computers everyday, from where we spend our vacations to the websites we frequent. And with the advent of technologies such as Google's search engine, even the most novice of computer users can find information on just about anyone.

Now imagine if our government, with their well-funded resources and expertise, were to utilize technology such as the one Google is considering and you can see why concerns about privacy are warranted.

But in this increasingly computerized world, how much privacy should we come to expect?