Google knows every Wi-Fi password entered from an Android device99+
Since it probably went right by most Android users, let's look at two builds. In Android 2.3.4, go to Settings and then Privacy. Om HTC models, Google gets your Wi-Fi password from an option called "Back up my settings," while on a Samsung device the naughty option reads "Back up my data." The unfortunate thing is that nowhere is Wi-Fi mentioned. The description reads "Back up current settings and application data."
In Android 4.2, go to Settings and then Backup and reset. The option is called "Back up my data," and the description for it reads "Back up application data, Wi-Fi passwords, and other settings to Google servers".
If you want your mind boggled, consider that we are not talking about one Wi-Fi network at home. We are talking about every Wi-Fi network your Android phone logged into including the McDonald's down the street, or that Adult Film store that used to be a PhotoHut down the street. While Android users can opt out, all of this information could be turned over to law enforcement officials if Google is compelled to do so.
Did you ever buy a new Android phone, enter your Google account information, and the new phone instantly hooked up with your router? Google can decrypt the stored Wi-Fi passwords with just a Gmail username and password.
It might be too late for your original password, but it is not too late to opt out of Google's storing of your Wi-Fi password. Once you've done that, you should change your Wi-Fi password. And if this whole thing shocks you, you might be a little too trusting of those who hold your wireless life in their hands.
source: Computerworld via RedmondPie