Jack Welch earned the nickname Neutron Jack by taking a neutron-bomb approach to downsizing GE’s organization: leave the facilities in place, but get rid of the employees. Time-Warner’s AOL division appears to be pursuing this same strategy, but with an interesting twist. Instead of targeting its employees, it’s targeting its customers.

First it alienated the Netscape faithful by turning their old home page into an American Idol version of a newspaper. (Civilians bombed in war vs. world’s hottest chili sauce: Vote Now!) Yesterday, it alienated the rest of its customers by making public a mountain of data about the searches they’ve been making. Although the customers’ names were stripped out, those in the know say there’s enough specificity in some of the search sets to tie them back to individuals – or at least to make educated guesses. I guess AOL figures that before it can attract users to the New AOL it has to cleanse itself of the clients of the Old AOL.

Seriously, though, there may be a silver lining in this big ugly cloud of leaked data. It will raise awareness of the fact that all the web searches we make, day after day, are stored neatly away in giant corporate data warehouses, where they can be sifted and analyzed by marketers and, if push comes to shove, government agents. And, further, it will raise awareness of the fact that it doesn’t necessarily have to be like that. There’s no reason why our search logs have to be saved. Andrew Orlowski suggests that we should push for regulations forcing search engines to erase keyword data immediately after a search is processed:

The only solution to the problem of data abuse – and it’s only an inadequate, and very partial answer – is to ensure the data isn’t there to abuse in the first place. If search engines were required to delete their users’ queries as soon as they were made, and to leave no trace, this would greatly diminish the dangers of false inference by law enforcement officials, health companies, banks, HMOs, and anyone else seduced by the lure of a faulty algorithm. Data that doesn’t exist is also less vulnerable to being stolen … If that takes a regulatory agency, to ensure search engines “Leave No Trace”, so be it.

Chimes in Scott Karp: “Clearly, our societal and legal infrastructure is not prepared to deal with the human mirror of the Internet. We need public debates. We need Congressional hearings. And, unfortunately, we probably need legislation.”

AOL’s own Jason Calacanis – svengali of the Netscape makeover, as it happens – suggests a different approach to the same end:

Frankly, I want us to NOT KEEP LOGS of our search data. Yep, you heard that right … we shouldn’t even keep this data. I know that’s crazy, but I learned this week that Wikipedia turned off their log files. They did this for tech reasons, but they now are keeping them off and not looking to solve the problem because of the huge upside of users knowing their searches on wikipedia DON’T EVEN EXIST! I think we should use this as a way to brand AOL Search: We don’t record your searches!

A search engine that guaranteed it wouldn’t save its search logs would certainly set itself apart from the pack – in a way that could well be appealing to a large number of people who value their privacy more than they value a flood of highly targeted advertisements and marketing pitches. I seriously doubt that AOL or any of the other big boys would take this route today, given the shape of their current businesses and revenue streams, but for a newcomer with a clean slate it could be a powerful pitch.

UPDATE: A comment to this post notes that you can search Google anonymously through Scroogle.org, which “scrapes” Google results and then serves them up through a Scroogle.org page. It provides a kind of buffer between your computer and the search engine’s computer. Scroogle.org also lets you search Yahoo anonymously.