Dan Gillmor on Grassroots Journalism, Etc.: Google Emulates Microsoft, Uh Oh: "Several years ago, Microsoft was pounded -- correctly -- for the 'Smart Tags' feature it was slipping onto people's PCs. This essentially created hyperlinks where none had existed before, and sent people clicking on those links to Microsoft-chosen content. It was insidious, and a number of folks, with Walt Mossberg in the lead, denounced the move so loudly that the company was basically forced to back away. (Of course, Microsoft being Microsoft, the company slipped it back into Office in the 2003 version, one more reason I didn't 'upgrade' on my Windows PC.)
Now Google, using its own growing clout, is doing something similar with its latest 'Google Toolbar' for Internet Explorer on PCs, says Search Engine Watch. No, Google doesn't control the operating system, and if I understand this correctly the feature isn't turned on by default (please correct me if this is not the case). Moreover, it only works with certain kinds of terms, and you have to explictly download the toolbar in the first place. And, of course, no one has to use this -- one more reason to choose Firefox as your browser, anyway. "
This unfortunately perpetuates some of the misperceptions about smart tag technology -- it uses a client-side, loosely-coupled recognizer/action handler model that isn't conducive to the sorts of Machiavellian scenarios projected by its critics.
Of course, the same may not be true for the new Google features...