This post on CNET points out that Google stated in court filings recently that GMail users have no expectation of privacy. I had the exact same reaction as the CNET contributor: I thought everyone already knew that.
If you're using GMail, or Google products in general, you should simply assume that Google knows a lot about you. Probably more than you might be comfortable with. But let's face it, Google's products like GMail, Google Earth, and of course the search engine, are absolutely fantastic. The Android operating system, another Google project, is simply dominating the market share for smartphones. And I'm using Chrome, Google's internet browser.
Put simply, many of us, myself included, are constantly giving our personal information to Google in one way or another. Google then uses that information to personalize the ads that I see everywhere, which just constantly reinforces my desire for this grill. In return, I get free email and other services that I really like and want. Free services and privacy don't usually go hand in hand.
Is it scary? Sure, maybe a little. But, what we used to think of as privacy is gone. As for me, I'm just going to keep using my Google stuff and gaze longingly at the grill of my dreams in ads around the internet.