Here's a few thoughts.
Firstly I would like to point out that another company has done the same thing as Google (WiFi access point sniffing). This was Skyhook wireless. Has there been anyone asking them if they had accidentally captured data packets in this process? Has anyone shouted about their lack of concern for privacy?
With that out of the way, I'll get to the meat of my message.
"dozens of countries are considering initiating criminal prosecutions"
Yes, true but also there has been a number of countries which are satisfied with Google's explanation and are not taking action.
"news broke that Google's Street View cars had been surreptitiously collecting Media Access Control (MAC) addresses"
The actual fact that they were recording this data was not made public, however, if you have actually seen a Google Street View car then you would realise that it was obvious who they were working for and the fact that they were recording something (albeit it was assumed it was just photos). But the fact remains that they were open about the fact that these cars were from google. Anyone know what a skyhook car looks like? After a lot of searching I find lots of images for Google street view cars but not a single photo of a skyhook car. I have personally seen two google cars but never a skyhook one even though they say they have a good set of data about my street. So, given these facts, which one was more "surreptitious".
"But once it was discovered that Google was capturing Wi-Fi identifiers as well, the controversy snowballed."
Again, Skyhook had already done this... Well before Google (IMHO).
"Now many people might ask what the data is worth? Surely it is just random noise? This isn't the case, the data is incredibly rich as it contains the IP address of the user"
Please remember that most of these IP addresses would be similar to 192.168.X.X which means that it was assigned by the router and only usable within that local area network. IP addresses which begin with 192.168 are not reachable through the internet because they always link to a device within the LAN and not on the internet. If you are confused by this, think of a landline phone. If you want to call someone close to you, you do not have to dial the STD code (or whatever it is called in your country). If you wish to call someone outside of your local area, you must dial a code first to say that you are dialling further afield. The only difference in this analogy is that with the IP addresses, when it refers to a machine that is directly connected to the internet, it is addressed by a totally different number. So, if google did collect all the IP addresses of devices attached to a WiFi router, I could imagine that a large proportion of them were in the 192.168.X.X range and totally useless and meaningless. For example, I have several machines on my LAN with IP addresses ranging from 192.168.0.1 (which is my router) to 192.168.0.25. Now I've told you that, please explain how that would be useful to anyone outside of my own private network.
As for concerns that Google were eavesdropping in on data. This is just ridiculous. A Google street view car passes your house in about 5 seconds... At a push 10 if it's going really slow. How could a 10 second snippet of data be of benefit to google? They have a great deal of experience at collecting and sorting data and can get much more valuable data from other sources. The only thing I can think of how this could be useful to Google is in an abstract way. Google could have used the data to map trends on what people use their WiFi machines for. Using the port number and other data, they could make a chart of what services we are all using. It might even be possible to know where we were connecting to for that very short time segment. But again, this very short window of data interception makes very little sense for anything other than that. I have heard some people suggesting that Google was trying to obtain passwords for people's internet accounts and such-like. Does anyone truly believe that? Of course, you could say that within that particular 10 second period, someone might have retrieved their emails and in that time it could have been picked up by the WiFi sniffer. True but it would be an extremely hit and miss approach to "spying on people".
It might look like I'm a Google fanboy but all I wanted to do is to make you aware of how hyped this all is. Politicians are always wanting to look good to those that vote for them. Sometimes you get a group of those people that shout louder than the others and so the politicians think that they must immediately jump in front of this charge so they look like the leaders they should be.
Personally, I believe that Google should be forced to destroy the private data (not the MAC addresses etc) and also forced to negotiate with each country involved for the right to use the geo-location data. Now, if this happened then by rights Skyhook should also be forced to do the same thing and any company that has taken data of this nature in this manner should also be inspected quickly to make sure that everything has been done correctly.
And on a last note, Skyhook wireless (the company that also retrieved MAC and other data was doing this since 2003! If Skyhook can do this without complaint, why was there an outcry when Google did it? You can go to Skyhook's website and see where all the hotspots are. They have huge amounts of data for Germany, why didn't the government take action then? If they didn't know about it, that makes me think that maybe Skyhook were more surreptitious than Google.
If Google is forced to destroy of their data then Skyhook and other companies in the same field should also do so. If Skyhook is allowed to keep this data and no other company can, then that is truly wrong. The EU and other governments are keen to prevent monopolization by companies but by preventing Google from being a competitor for Skyhook it looks like that's exactly what will happen.