Google said it had now agreed to provide lawyers for Viacom and a class-action group led by the Football Association of England, a large viewership database that blanks out YouTube username and Internet address data that could be used to identify individual video watchers.

The parties are still working towards a separate agreement concerning YouTube employee data, an issue I wrote about yesterday.

Viacom wants to know which videos YouTube employees have watched and uploaded to the site, and Google is refusing to provide that information, CNET News has learned.

This dispute is the reason the two companies, and lawyers representing a group of other copyright holders suing Google, have failed to reach a final agreement on anonymizing personal information belonging to YouTube users, according to two sources close to the situation.

From a discovery standpoint, I’m not sure what Google’s rationale might be for refusing to hand over employee data.  If anything, as the CNet article points out, employee data might be highly relevant to Viacom’s claims and detrimental to Google’s DMCA safe harbor defense.  What did the employees do?  Did they upload infringing videos?  Did they have actual knowledge of infringement?

In any case, this underscores why it’s a bad idea to leave privacy protections to those who profit from gathering our data.  It also makes Google seem to be more protective of its employees than of the public.  As TechCrunch put it today:

Google’s self imposed code of conduct is “Don’t be evil.”  It doesn’t say “don’t be evil unless there’s important litigation at stake.”  Google’s reputation is on the line, and how they respond will show their true character.  They’ve shown they’ll go to bat for employees, now it’s time for them to show they’ll go to bat for their users.

Hat tip: Gigalaw.

What would be enough to mobilize the public?  In 2006, Ed Felten suggested that a privacy Exxon Valdez “will have to be a leak of information so sensitive as to be life-shattering.”  But how sensitive is our viewing of, for example, Harry Potter Puppet Pals?  It’s creepy to think of lawyers having access to it, but is it life-shattering?  Nonetheless, it appears that the public, companies, and Congress are becoming more attuned to privacy matters.  Just last week, Google and Yahoo both recently endorsed the idea of privacy legislation before the Senate Commerce Committee.

In the meantime, what the the litigants doing?  The NYTimes BITS blog notes, “A week after Google and Viacom both said they hoped to agree to make YouTube viewing data anonymous before Google hands the information to Viacom, no agreement has been signed.”  (Emphasis added.)  The parties blame each another.  A Google lawyer says: “If Viacom refuses to allow us to anonymize viewing history, we will seek review by the court.”  A Viacom spokesperson counters:

Viacom suggested the initiative to anonymize the data, and we have been prepared to accept anonymous information since day one.  We hope that Google will turn its focus back to anonymizing the data they are required to deliver, and spend less time making statements about why they won’t get it done.

It’s not especially clear what the parties are doing or how things might be resolved.  As I blogged recently, an earlier Times article initially stated that the parties were “working to protect the anonymity of YouTube viewers.”  (Emphasis added.)  A few hours later, the Times article was edited to say that the parties were “hoping to come up with a way to protect the anonymity of YouTube viewers.”  (Emphasis added.)  Apparently the parties’ resolve was tempered from “work” to mere “hope.”  The parties need to do better, especially Google, which collected and retained all the information.

Hmm.  I wonder if the timing of Google’s change-of-heart had anything to do with this week’s court order that Google produce records of millions of YouTube user’s viewing habits.

The order raised concerns among users and privacy advocates that the online video viewing habits of hundreds tens of millions of people could be exposed.  But Google and Viacom said they were working to hoping to come up with a way to protect the anonymity of YouTube viewers., and

Viacom said that the information would be safeguarded by a protective order restricting access to the data to outside advisors, who will use it solely to press Viacom’s $1 billion copyright suit against Google.

It’s good that some steps are being taken to limit the use of the information.  But why is Google collecting and retaining so much information? Maybe there’s business value in keeping it, but there’s also business value in not angering hundreds tens of millions of users.  Google’s apparent taste for data retention risks a well-deserved loss of goodwill.  (Or considering people’s wayward attitudes towards privacy, perhaps not.)  I recognize that some information must be retained for a variety of reasons.  But the more unnecessary information you keep, the more likely somebody you didn’t envision — a wayward employee, a hacker, or even worse, an adverse litigant — will find a use for it you didn’t want.

The court’s order can be found here.

ADDENDUM: The Times has revised the text of the quoted portion of the article from when I viewed it earlier.  I’ve indicated appropriate changes above.

NOTE (JULY 13): See here for updates.