Lack of end-to-end-encryption means that conversations on Hangouts, if subject to a legal order, can be wiretapped or otherwise surveilled.
Google hadn't disclosed this information until a recent Reddit AMA (ask me anything) and a Vice follow-up that resulted. It's not clear whether Google has been asked to provide access to Hangouts, but the potential is there.
We asked Google to clarify, or elaborate, on Monday, and a spokesperson confirmed that Hangouts doesn't use end-to-end encryption. That makes it technically possible for Google to wiretap conversations at the request of law enforcement agents, even when you turn on the "off the record" feature, which actually only prevents the chat conversations from appearing in your history—it doesn't provide extra encryption or security.
If the statement was reported accurately, it's an interesting differentiator between Google and Apple's services.
FaceTime, Apple's video and audio calling service, is end to end encrypted. The content of your call is private and secure, and — for all intents and purposes — available only to you and the person with whom you're talking. Technically, Apple could do the equivalent of a person-in-the-middle attack to get at the data, but the consequences would be so severe that it makes such a thing extremely unlikely. Apple has also been vocal about privacy and security, making it a CEO-driven priority, and positioned it as a competitive advantage and customer-facing feature.
With Hangouts — and Microsoft's Skype, too — that end-to-end encryption doesn't exist, and Google doesn't seem to have any of those technical safeguards. Neither Google nor Microsoft has been as vocal about privacy for those services, either. Apparently for good reason.
Because of end-to-end encryption and Apple's stance on privacy, FaceTime was accepted as HIPPA compliant for BabyTalk, which provides remote therapy to infants with cochlear implants.
Some people — perhaps even many people — may not care about end-to-end encryption for their internet calls, or might need to use Skype or Hangouts for things like group calls or screen sharing or other features not yet supported by FaceTime.
If you own an iPhone, iPad, or Mac, you're lucky in that you have access to every service: Hangouts, Skype, and FaceTime. So you can use whichever one bests suits your needs at any given time. That includes FaceTime when you want an end-to-end encrypted call.
And that Apple cares about end-to-end encryption is important. It means they've determined it's in their best interest to align their products and policies in a way that's in our best interests.