Monday, 16 July 2007

Google faces Australian court action

It was reported at the end of last week that the Australian Competition and Consumer Commission (ACCC) is to take legal action against Google for allegedly deceiving consumers by blurring the difference between paid and unpaid search results.

This is believed to be the first lawsuit of its kind, although the issue of differentiating the paid (sponsored) results from the main search engine generated results has been around for many years, with all the search engines identifying these through separate colour bands and text wording. In some ways this action seems to be revising many of the issues that were addresses back in 2001 when PPC advertising started to become more mainstream.

This particular action taken by the ACCC is against Google and one of their paid advertisers, Trading Post (owned by Sensis). It dates back to adverts that were bought in 2005 and claims that Trading Post bid on the business names of several Newcastle car dealerships so that users who clicked on the ads were taken to the Trading Post site, believing that they were linked. The ACCC claims that Google didn't adequately distinguish the advert from their own objective search results.

We await more details to see how this case develops. There are suggestions that the outcome could have significant implications for the global search advertising industry and the way that ads are displayed or how keywords are used. However, there is also a strong feeling of deja vu here and that the case may just as quickly disappear once the parties discuss the action and realise that these issues have been adequately addressed in the past.

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