Google Down, Down Under

Not everyone is loving Google (Nasdaq: GOOG  ) these days. The company's paid search platform is coming under fire after an auto dealer's sponsored contextual ad began popping up in searches for rival showrooms.

If you're not familiar with Google's AdWords program, advertisers pay for the right to have their brief hyperlinked text ads appear on search engine result pages. Run just about any search on Google and you will find the ads dangling on a column to the right and occasionally in a shaded box on top of the organic results.

The Australian Competition and Consumer Commission, the country's regulatory watchdog, is filing suit against Google subsidiaries and the advertiser, alleging that the move is a deceptive business practice.

Advertising under trademarked keywords -- such as a rival company's name -- has been a thorn in Google's side before. The practice has been upheld domestically, but tighter laws in countries such as France and Belgium do not offer that kind of sponsorship flexibility.

Money is at stake, of course. All of the world's leading search engines -- Google, Yahoo! (Nasdaq: YHOO  ) , Baidu.com (Nasdaq: BIDU  ) , and Microsoft's (Nasdaq: MSFT  ) MSN -- count on their right to populate results pages with targeted ads. Losing a legal battle over that right is the equivalent of bulldozing an outdoor advertising specialist's billboards.

If Google comes up short in Australia -- the way it did in France -- it won't lead to a material shortcoming, for now. However, it sets a troubling precedent for a company angling anxiously to populate the world with its virtual bulldozers.

The throwdown Down Under may be about Australian cars, but it is ultimately about Google's own vehicle.     

For related Foolishness:

Microsoft has made the cut as aMotley Fool Inside Value stock pick. Yahoo! is aStock Advisor recommendation. Baidu.com is aRule Breakers pick. So many newsletters, so little time? Don't worry. You can check them out for free for the next 30 days with trial subscriptions offers.   

Longtime Fool contributor Rick Munarriz has never pet a kangaroo. He does not own shares in any of the companies in this story. He is also part of theRule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.


Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 531823, ~/Articles/ArticleHandler.aspx, 12/21/2014 6:28:53 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement