Jan. 7 (Bloomberg) -- Google Inc.'s Internet advertising expansion is causing government regulators to question whether the search engine has too much power and collects too much information on users, the New Yorker magazine said.

Google ultimately may reach $100 billion in annual sales, up from an estimated $16 billion in advertising revenue this year, by selling more through television and mobile phones, Chief Executive Officer Eric Schmidt told the magazine. The company will ``really be hosed'' if it doesn't protect users' privacy, Schmidt said.

Google, owner of the most popular Internet search engine, last summer reduced the amount of time it stores users' search histories to 18 months from two years and has called for international standards for privacy, the magazine said.

Mountain View, California-based Google is experimenting with information-gathering software bits, or ``cookies,'' that collect limited data and expire, the New Yorker said, citing Pablo Chavez of Google's Washington office.

Google fell $7.75 to $649.25 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares are down 12 percent from their Nov. 6 peak close of $741.79.

Google has expanded its U.S. government lobbying staff to about 30 people since opening a one-man office in suburban Maryland in 2005, wrote the article's author, Ken Auletta, who has covered communications for the New Yorker since 1992.

The U.S. Federal Trade Commission and Senator Herb Kohl, a Wisconsin Democrat, have examined Google's privacy practices at the urging of the non-profit group Center for Digital Democracy, the article said.

Google's planned acquisition of DoubleClick Inc., approved by U.S. regulators and under review in Europe, has made ad companies such as WPP Group Plc concerned about how the company plans to expand in the business, the New Yorker said. Its planned bid on wireless airwaves and its mobile-phone software under development may cause conflicts with its partner Apple Inc., maker of the iPhone handset, the article said.

To contact the reporter on this story: Crayton Harrison in Dallas at tharrison5@bloomberg.net.

Last Updated: January 7, 2008 16:11 EST