This is from a TimesOnline piece entitled “Google faces landmark lawsuit over sponsored links”.
A consumer watchdog is taking legal action against Google over the way it sells and displays its sponsored links, in a case that could “send shudders down the industry”.
The Australian Competition and Consumer Commission (ACCC) said that it believed its action, which named Google Inc and Google subsidiaries in Ireland and Australia as defendants, was “the first to seek legal clarification of Google’s conduct from a trade practices perspective”.
It seems that in 2005, an Australian classified ads magazine took out sponsored ads in the names of car dealerships that would be considered competitors. People would click on the link thinking they were going to the dealership and instead end up at the magazine’s website.
Curiously, this Australian Competition and Consumer Commission dropped the case against the magazine when they said they would stop this practice. Yet, the ACCC is continuing it’s pursuit of Google because they allowed this fraud. The ACCC also thinks that Google is deceptive in their identification of the sponsored links.
“Google, by failing to adequately distinguish sponsored links from ‘organic’ search results, has engaged and continues to engage in misleading and deceptive conduct.”
I use Google a lot. Rarely do I ever click on the sponsored links. The only times I do, are when I know, for fact, that the sponsored link is relevant. If I’m looking for guitar strings and the sponsored link is a merchant that I have used before that’s having a sale on that brand, for instance. For the most part though, I ignore the ads and that is a pretty simple thing to do.
If you have been a regular reader, you know that I am not quick to defend Google. This case is an exception because it’s just silly. The part about an advertiser registering false names is fraud but the fraud is not on the part of Google, it is on the advertisers.
As for the sponsored link issue; the ACCC would first need to prove that the sponsored links are not “adequately distinguished and then, demonstrate some type of standard that Google would have to live up to regarding how to distinguish sponsored links from “organic” search results. That all seems pretty subjective and not the type of thing that would fly in a court of law.
I am presuming that the phrase, “misleading and deceptive conduct”, has to do with some of the sponsored links lacking relevance to the searches. Again, the ACCC would have to prove that Google knowingly does this and take the onus off the advertisers. More from the TimesOnline…
Shara Evans, head of the IT consultancy Market Clarity, said the case would have far-reaching implications if the court found that a search engine was responsible for monitoring everything that advertisers paid to put up as sponsored links.
“What would have a real impact is if Google had to take a policing role into the content of the advertisers,” she said. “That, I think, would send real shudders down the industry.”
If it were possible to force Google to police these ads then, Google would have to pay actual people to do it. That would effectively end what is the only legitimately profitable type of advertising in the IT world.
Google has faced these types of lawsuits before and, for the most part, been on the winning side. The previous cases were brought by companies that were alleging that competitors were buying sponsored links using trademarked words or phrases. This case is different in that it is coming from an outside party, the ACCC. If the case has any legs, it will spell big trouble for Google. Time will tell on that.
At the very least, Google would serve themselves well by demonstrating that they are serious and take swift action when fraud is brought to their attention.
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Tags: Google, The Australian Competition and Consumer Commision
Jayne d'Arcy wrote,
I use Firefox which has a great plugin that allows me to block annoying ads and popups on most sites with advertising. I purposfully don’t block the ads in Google’s search because sometimes, when I’m looking for something, I have to resort to those sponsored ads. What bugs me is that I often discover that I’m following a link to a site that has nothing whatsoever to do with what I was looking for.
I’m not so certain this is Google’s fault as it goes more toward the keywords I’m using to generate my searches. It isn’t all that surprising if I’m searching for white castle images and come up with ads for White Castle Burgers.
Link | July 12th, 2007 at 4:13 pm