Huge fines are still puny for Google and Goldman

Following an iPhone tracking privacy scandal earlier this year, Google will have to pay the biggest Federal Trade Commissions fine ever given to a single company, which for a huge corporation like Google doesn't add up to all that much, showing how little impact even the largest fines have. The total comes out to $22.5 million, which, according to The Wall Street Journal's Julia Angwin's calculations, represents about five hours of Google's revenues, which amounted to $10.65 billion in the first quarter of this year. $22.5 million isn't even a slap on the wrist, it's more like an wink and a nudge. Yet, the government often uses these monetary penalties as a mode of punishment, and the big numbers (to mere mortals) attract big headlines, but looking back at some federally enforced pay-ups, even huge fines look infinitesimal next to these giants' profits.

 

Google

 

Fine: $500 million. Today's FTC fine isn't the first time Google has had to pay-up to the government for some unlawful behavior. Last year Google agreed to a $500 million forfeiture to settle a Department of Justice investigation into the illegal sales of prescription drugs using Google's AdWords. But even then, the penalty amounted to, according to the Justice Department release, "the gross revenue received by Google as a result of Canadian pharmacies advertising through Google’s AdWords program, plus gross revenue made by Canadian pharmacies from their sales to U.S. consumers." Google's business is much, much bigger than selling Canadian pills.

 

How much it didn't hurt: Well, a half billion dollars is a whole lot more than $22.5 million. But, it still represents a fraction of Google's revenues. "It’s not clear that extracting $500 million from Google’s rather full coffers is going to do much to stop the business of online pharmacies," wrote Wired's Ryan Singel at the time. "The penalty, while large, would cause little financial strain on the company," added Los Angeles Times's Shan Li and Tiffany Hsu, speaking with analysts.

Read more at The Atlantic Wire.