Commercial Alert attacks paid search engine placement

July 17 2001

Commercial Alert, a 3-year-old group founded by consumer activist Ralph Nader, has asked the Federal Trade Commission a to investigate whether eight of the Web's largest search engines are violating federal laws against deceptive advertising.

Pandia has several times warned against a possible pay-per-click backlash. The tendency to mix paid and regular search engine results may ultimately undermine the credibility and legitimacy of the search engine services, making searchers look for more reliable resources.

We have already seen how Google gains ground in the search engine market, mainly because it is able to deliver accurate and relevant results. Google is one of the few major search engines that clearly mark paid results as advertising, presenting them in specially colored boxes apart from the regular results.

The rest tend to disguise them as "featured listings" or something similar, which may easily be interpreted as "special sites selected by the search engine editors", although they actually are paid results from the GoTo pay-per-click search engine.

An honourable exception is Excite which presents pay-per-click results as "Sponsored Links by FindWhat.com", which they are. AltaVista calls them "featured sites" and "partnered listings", while Lycos and HotBot calls them "Featured listings".

Companies named in the Commercial Alert in complaint include AltaVista, AOL Time Warner, Direct Hit, iWon, LookSmart, Microsoft and Terra Lycos.

"These search engines have chosen crass commercialism over editorial integrity," says Gary Ruskin, executive director of Commercial Alert. "We are asking the FTC to make sure that no one is tricked by the search engines' descent into commercial deception," Ruskin said. "If they are going to stuff ads into search results, they should be required to say that the ads are ads."

According to Cnet three of the search engines had responded to The Associated Press' inquiries about the complaint late Monday afternoon. Two, LookSmart and AltaVista, denied the charges. Microsoft spokesman Matt Pilla said MSN is delivering "compelling search results that people want." The FTC had no comment about the complaint.

Pandia actually feels there is nothing wrong with delivering paid results. The search engines need to earn a living, and traditional banner ads are no longer bringing in the needed revenue.

The search engine companies argue that paid listings may be relevant for searchers, especially if they are looking for goods and services. The GoTo pay-per-click search engine, which is the major deliverer of paid results to search sites, has a rather strict editorial regime. Editors control all the ads for relevancy. These listings may not be the best and most relevant, but most of them are at least as relevant as some of the other page one listings.

The problem is that visitors may get the impression that they are normal "neutral" search engine results. Hence they could be deceptive, which is definitely not a good thing. This might harm the legitimacy of this search engines in the long run, especially when activist groups like Commercial Alert start working on the case.

Pandia will therefore offer the search engines a new solution to this problem -- for free. We suggest that search engines mark paid results as "Listing from our Yellow Pages", and print them on a yellow background near the end of each result page. The yellow colour will bring positive associations and draw attention, and might even lead to higher click-through rates.

Moreover, we suggest that these listing are followed by a "More yellow listings..." link, leading to a separate "yellow" page with pay-per-click results only. This will definitely make GoTo advertisers happy, at the same time as searchers clearly will see the difference between traditional and paid results.

If people are looking for goods and services, they are more likely to look in the "Yellow pages". We all use the phone book this way, without feeling cheated.

The text of the complaint is available at the Commercial Alert site
Search engines accused of deceptive results (Cnet)
GoTo invades the Internet Explorer (Pandia)
NBCi serves GoTo results only (Pandia)
Consumer Group Asks FTC To Investigate Search Ads (SEW)

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