According to Marissa Mayer at the Google Blog , "Larry and Sergey told me we could only add this to the homepage if we took a word away – keeping the "weight" of the homepage unchanged at 28. Given that the new Privacy link fit best with legal disclaimers on the page, I looked to the copyright line. There, we dropped the word "Google" (realizing it was implied, obviously) and added the new privacy link alongside it."
With privacy advocates and organization breathing down on Google's neck, with this move, Google has finally found some room to breathe. The display of privacy link would surely ease the concerns of these organizations.