I guess when information is your business, you’re going to come under close scrutiny for how you put that information to use. Google‘s business is information – gathering it, packaging it up, and making it available to users. When they were just indexing websites there wasn’t too much controversy, but with the arrival of products like Gmail, StreetView, Buzz and, latterly, Google+, the information they had on hand got much more personal. And people care about their personal information.
Or let’s say you constantly talk about Jaguar cars in Google+ and want to find out about the latest model in Google Search… Google hopes to better tailor your search results based on information in their other products – picking up the cars rather than the cats.
This combined policy is proving controversial, though, with various groups and individuals expressing concern. One of the major concerns is that the new policy is compulsory – if you want to keep using Google products you have to accept that your data will be shared between them.