Peter Fleischer, Global Privacy Counsel of Google, now says that Google will anonymize its search server logs after 18 months, rather than the previously-established period of 18 to 24 months.

Google is harvesting a lot of data from users of Google’s toolbar, email, search history and other features. The data help Google deliver more accurate and personalized search results.

This practice is controversial, as many argue that Google knows too much about the searching and surfing habits of its users.

The human rights group Privacy International recently ranked Google last among Internet service companies as regards privacy issues:

Google’s increasing ability to deep-drill into the minutiae of a user’s life and lifestyle choices must in our view be coupled with well defined and mature user controls and an equally mature privacy outlook. Neither of these elements has been demonstrated. Rather, we have witnessed an attitude to privacy within Google that at its most blatant is hostile, and at its most benign is ambivalent.

However, Fisher is not responding to the complaints made by Privacy International. He is responding to European policy makers.

Google has discussed the issue with The Article 29 Working Party, an advisory panel composed of representatives from all of the E.U.’s national data protection authorities.

Fisher argues that Google has a legitimate interest in retaining search server logs:

• to improve search algorithms for the benefit of users
• to defend systems from malicious access and exploitation attempts
• to maintain the integrity of our systems by fighting click fraud and web spam
• to protect users from threats like spam and phishing
• to respond to valid legal orders from law enforcement as they investigate and prosecute serious crimes like child exploitation
• to comply with data retention legal obligations

He points out that future data retention laws may obligate Google to raise the retention period to 24 months. And under no circumstance is Google willing to consider a period shorter than 18 months.

UPDATE

Google’s Matt Cutts notes that Google is also considering reducing its cookie expiration time. (Cookies are small ID files saved on your computer through the Web browser).

More at Pandia: Ixquick warns searchers about privacy issues
Norwegian authorities investigate Google on privacy issues

See also Times Online: Google bows to privacy backlash