UPDATE Jul 10, 2020: Now articles are saying you should turn off “load image by default” to avoid the tracking pixel. No kidding! Can you say, “I told you so.” Google is the one that changed the default – they should change it back!
https://www.theverge.com/21319293/gmail-reading-email-tracking-pixels-how-to-prevent-block-chrome

MY ORIGINAL POST FROM 2013 FOLLOWS…
This week Google rolled out a new feature to Gmail. Traditionally email clients, including Gmail, have always set “show images from sender automatically” off by default to protect the user from being tracked by spammers. The new Gmail client has changed this setting to on by default. Since Google now runs the largest email system in the world and their informal corporate motto is “Don’t be evil,” they can expect some scrutiny when they change how things have normally been done industry-wide. Some say that Google has found a way to protect us from being tracked and the new setting is good. But others disagree.  I have read conflicting articles about it in Wired and elsewhere on the ‘Net. Is Gmail’s new show images by default a good thing or not? Is Google “Blowing up email marketers by caching images now” or not? In fact, this new Gmail roll-out contains a little good and a little bad. Let me explain.

First, take a look at what Google has actually done under the hood of Gmail. To see what I am talking about go to your Gmail settings and look at the general options tab here:

If you click “Learn More” you will be presented with the official description of the new functionality in Gmail. Notice this part of the text

Gmail serves all images through Google’s image proxy servers and transcodes them before delivery to protect you in the following ways:

• Senders can’t use image loading to get information like your IP address or location.
• Senders can’t set or read cookies in your browser.
• Gmail checks your images for known viruses or malware.

In some cases, senders may be able to know whether an individual has opened a message with unique image links. As always, Gmail scans every message for suspicious content and if Gmail considers a sender or message potentially suspicious, images won’t be displayed and you’ll be asked whether you want to see the images.

In the first section above we read that Google is protecting us from marketers having certain identifying information about our computer or our browsing habits (through IP address or cookies) and as always Gmail is great at protecting us from malware and viruses. I applaud Google for these things and I seriously love Gmail.  It is the best tool I have ever used to battle the rivers of spam that flow daily and safely communicate with the world.

Unfortunately there is another section below that. Notice these words, “In some cases, senders may be able to know whether an individual has opened a message with unique image links.”  Look, I will be honest. I don’t want people to know when I listen to messages on on my telephone answering machine. After all, I might want to use it to screen calls. For basically the same reason, I don’t think it is “a good thing” if those who send me an email know – without my consent – the exact moment when I read that mail.

After reading their official explanation it dawned on me what their real motivation could be. Google wants to be the one who decides who can track me and who cannot because they can then charge for that privilege! Just think of how much Mailchimp and others will be willing to pay so that Google doesn’t consider them “potentially suspiscious.” Yes, think about it – one of the biggest Email clients has gone to showing images by default and now Google has the power to filter which services can track mail with those images and which services cannot – through their own proxies. Whethe their motives are good or bad, the fact remains – the folks at Google have just quietly set themselves up as the gateway for email marketing for a very  large percentage of the entire market.

So for those who, like me, want to make that decision for themselves I recommend turning off “show pictures by default” and using Gmail as a useful tool under your control rather than the other way around.