Paid Placement: Divided search party

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Cash-strapped marketers are increasingly turning to Internet search as they try to improve the targeting and focus of their interactive media spending. Search, via Google, Yahoo!, America Online, AltaVista, 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.

While the interactive industry has obsessed over the re-upping of traffic partner agreements and patent-infringement suits-Overture Services filed suit this spring against rival Google, alleging patent infringement-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.

complaint with FTC

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. 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," he said.

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.

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 AltaVista's paid listings.

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