In case you hadn’t heard, Google is being taken to court again.

This time the threat is from Down Under, a competition regulator known as the Australian Competition and Consumer Commission. Apparently a couple of car dealerships in Newcastle found their names being used in ads on Google - but clicking on those ads would take the user to a major competitor’s website. Because of this, the ACCC is charging Google with being “misleading and deceptive” about the nature of the sponsored advertising that appears throughout their SERPs.

The issue of advertisers using their competitors brand and name as keywords or ad text is nothing new. Here in the U.S. window blind vendor American Blind is set to begin their case against Google for the very same reasons later this year. Certainly there are ways to fight these unscrupulous competitors should you discover them. Should you find your trademarked terms being used, you can file a trademark complaint with Google (different forms exist depending on whether you are in the U.S. and Canada or outside the U.S.) But what do you do while you wait for Google’s customer service team to respond to this request? And what if you’re a smaller local business with keywords (like your business name) your competitor is exploiting that aren’t trademarked? In some cases you may be left with no choice but to fight fire with fire and start bidding on your competitors’ branded terms. That’s a fight that Google certainly wins, as more and more keyword inventory in Adwords is monetized.

The ACCC is taking things a step further this time though. Taking a look at the actual complaint filed, you’ll see that Google is being challenged about just how well they distinguish
between their paid and organic listings:

Further, the ACCC is alleging that Google, by failing to adequately distinguish sponsored links from “organic” search results, has engaged and continues to engage in misleading and deceptive conduct in breach of section 52 of the Act.

The Act in question here is the Australian Trade Practices Act 1974. Let’s take a look at section 52:

Misleading or deceptive conduct

(1) A corporation shall not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. (emphasis mine)

(2) Nothing in the succeeding provisions of this Division shall be taken as limiting by implication
the generality of subsection (1).

If this is hinging on whether Google ads are likely to deceive search engine users, then a case can definitely be made. “But wait,” you might say, “Google clearly marks the ads as ‘Sponsored Links’ on their SERPs.” That may be so. Yet, as of earlier this year, 62% of searchers were still unaware of the distinction between sponsored and organic results. It’s not a stretch to say that Google is trying to take advantage of that. Why else would Google be doing things like giving the top three sponsored links real estate at the top of the page when it used to be the top two? More ads appear above the fold. Present day Google is built on the advertising dollars generated by Adwords, and those ads were carefully integrated into SERPs after Google spent years branding itself as the source for relevant results. One might say Google’s entire existence is built on deceiving it’s users into clicking on those ads (interestingly, the sort of behavior they frown upon with their Adsense publishers).

To be honest, I am not sure how far the ACCC is going to be able to go with this. As far as deception is concerned, Google is most likely going to point to two things; the aforementioned “Sponsored Links” text, and the fact that the display URL in Adwords text has to match the domain of the landing page URL. So there’s only so much deception that can be happening here, given that your competitor’s ad could say they are you in the title, but the display URL isn’t going to match up with that. Still, the ACCC is serious about this, and is certainly not afraid to toot their own horn, proclaiming this as “the first action of its type globally.” How much revenue would Adwords be generating if Google had to replace “Sponsored Links” with “THIS IS AN ADVERTISEMENT” under every ad? How many advertisers would be likely to continue advertising under those conditions?

Maybe the thought of that might teach Google to stop being so damn deceptive.