Thu, May 19, 2011 - Page 9 News List

Google hopes charm offensive will win over European regulators

By Eric Pfanner  /  NY Times News Service, PARIS

Chiseled into the stone facade of the vacant Second Empire building at 8, rue de Londres here is the name of the French national railroad, a former occupant. Most recently, the site housed another conservative pillar of the French corporate establishment, the insurer AXA. The proud new owner is a company with a very different image in France, more bomb-thrower than bourgeois: Google.

Google, the Internet giant, acquired the building, around the corner from the Saint-Lazare train station, for an estimated 150 million euros (US$210 million) and Google employees are expected to move from their current nondescript Paris office by the end of the year.

The investment is part of a campaign by Google to win hearts and minds across Europe as it confronts legal, regulatory and political challenges on issues including privacy, copyright disputes, antitrust actions and taxation. The company is spending hundreds of millions of euros to try to demonstrate that it is a responsible corporate citizen and a valuable contributor to the local economy, not the willful opportunist it is often portrayed as in France.

Google executives said that their strategy had been formulated late in 2009, when they realized that their problems in Europe were more serious than in any other part of the world, with the exception of China, and could no longer be brushed aside with recitations of the company’s slogan: “Don’t be evil.”

“We were hearing from people in government, the media, in our industry: ‘You need to be more of a part of the culture writ large,”’ said David Drummond, the chief legal officer at Google. “We took these criticisms to heart, and we’ve been working to defuse these issues.”

“We’re really trying to work with folks in Europe to establish ourselves as more of a local player that is investing in jobs, in facilities, our physical presence, and all the ancillary things that come with that,” he added.

Drummond said he had adopted the role of Google’s “chief diplomat” in Europe, meeting regularly with politicians, business leaders and regulators. Other top executives, including Eric Schmidt, the former chief executive and current executive chairman, and Larry Page, the cofounder and current chief executive, have jetted to Europe to make speeches and to dispense chunks of the company’s US$36 billion in cash reserves.

Many of the investments seem to be tailored to align with issues of particular concern to local policy makers and populations. In Ireland, for example, where the bursting of a huge real estate bubble has left the economy in tatters, Google recently acquired, for 100 million euros, the tallest office building in Dublin, buying it from the government agency that is managing bad loans held by Irish banks.

UNDER INVESTIGATION

In Germany, where Google is under criminal investigation over whether its Street View mapping service broke laws on data protection, the company plans to open an Institute for the Internet and Society. The center, to be set up in Berlin with an academic institution still to be identified, will study issues like privacy in the digital era.

In France, where Google’s efforts to digitize books and other cultural material have been denounced as cultural imperialism by some critics, the new Paris headquarters will house what Google calls a European cultural center.

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