Last year, after harsh criticisms, Google decided to use an 18 month IP anonymization cycle. Meaning, Google user's information of which web sites they viewed, used, or purchased from, would be deleted from their databases after one full 18 month cycle. Such criticisms came from larger sources such as the EU Justice Commission (European Commission), saying that a recently published 9 month anonymization policy from google this year was a "step in the right direction". Ultimately, the EU would like Google to eventually reduce its IP address cycle to a period of 6 months.
However, in Google's defense, they claim that this sort of monitoring acts as a sort of filtration and safety precaution. By using this information, the company is able to counter click fraud and search poisoning. The overall quality of search results is just better with such monitoring. Because Google is a free search engine, they need relevant advertisers on their website. In fact, Google uses the points of which users aren't even required to submit a "real" name, address, or any personal information about themselves which might jeopardize their security. In contrast though, many still question the truthfulness about it's internet security released by Google's public representatives.
If we look at competition such as other search engines and databases like Ask.com and Microsoft they both seem a bit more anonymous. Ask.com has recently modified its features to enable its users to completely anonymously. So, wherever you stand on the whole internet privacy issue, how much is enough? What is considered a violation of a person's right of privacy? Personally, if information isn't being used to wrong me in anyway, I don't have a problem with it. However if the same personal information is being used to impact my life in a bothersome way, everyone has an issue with that. Use the internet at your own warning.