Wants Paid Advertising Revealed to Online Consumers

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NEW YORK (AdAge.com) -- While cash-strapped marketers are increasingly turning to Internet search engines to try to improve the targeting and
Google clearly labels 'sponsored' search engine results and places them apart from the real results of the search.
focus of their interactive media spending, the government wants portals to tell consumers when a search result is a paid ad.

Search, using sites such as Google, Yahoo!, America Online, Alta Vista, Ask Jeeves and many others, is becoming a standard component of media plans. Paid search, based on cost-per-click pricing, and the auction-based method, where advertisers bid on keywords with the highest bidder earning top placement in search results, have become popular tools in the anemic online advertising climate.

Compromising integrity
While the interactive industry has obsessed over the re-upping of traffic partner agreements and patent-infringement suits -- such as the one Overture Services filed this spring against rival Google -- consumers and trademark holders are concerned that the paid search model, whereby advertisers pay to be included in a search engine's database, compromises the relevance and accuracy of searches.

Last summer, consumer groups filed a complaint with the Federal Trade Commission alleging the results generated by several pay-for-placement search entities constituted deceptive advertising.

FTC ruling
The issue came to a head last week when several search engines agreed to change or consider changes in the way they present search results in order to help consumers tell the difference between ads and Web content. The FTC said it wanted the search engines to come clean with consumers, distinguishing paid search results from non-paid search results.

"All ads that appear on Google are clearly marked as 'Sponsored Links' and are set apart from the objective, Web-wide search results. Ads are only displayed if they're relevant to the search terms a user enters, which means that Google's ads help our users find the information they need," Google spokesman David Crane said in an e-mail. "Tricking users into viewing ads degrades consumer confidence in search engines and directly lowers the performance of an online ad campaign."

AOL Time Warner's America Online treats the issue this way: It has a list of "sponsored links" at the top of its search page and then lists unsponsored search results.

Clear disclosure
CMGI's AltaVista contends it offers users clear disclosure. "We believe that the paid listings we display on our site are delineated from our search results and that the disclosure is not misleading," Fred Bullock, chief marketing officer of AltaVista, said in a statement.

Overture Services compiles Alta Vista's paid listings.

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