Google wants to know what you search for, and plenty of people have wondered why. According to the company's global privacy counsel Peter Fleischer, log data is used to improve core Google search services, including Google's spell checking software and search results. That's nice, but can't the same be done just as well with anonymous data? If the search giant could avoid privacy leaks such as AOL had, why wouldn't it? Fleischer notes the company also uses the information to deal with fraud and abuse. "Immediate deletion of IP addresses from our logs would make our systems more vulnerable to security attacks, putting the personal data of our users at greater risk. Historical logs information can also be a useful tool to help us detect and prevent phishing, scripting attacks, and spam, including query click spam and ads click spam."
Fleischer also claims that retaining personal data for two years is necessary because of European and US data protection laws, even though those laws do not yet exist. The EU's Data Retention Directive was passed in late 2005 but has yet to be implemented by the various member states (which have until 2009). The law requires each country in the EU to adopt a retention requirement of between six and 24 months but even though the laws are not yet in effect and won't apply retroactively, Google still believes it is necessary to retain data now for the longest possible period the law provides for. In the US, Fleischer suggests that Google's behavior is proper because the government has simply "called for 24-month data retention laws."
News source: Ars Technica