FTC tough on Google paid search results

(James Hood @ ConsumerAffairs) Google, not exactly known for its journalistic expertise, has lately been lecturing newspapers and other news outlets about its objections to paid content on their web pages but now Google and the other big search engines are getting some sterner advice from the Federal Trade Commission (FTC).

This raises the question of which is scarier -- "advice" from a search engine that could put you out of business by dropping your site to the bottom of its search results or a stiff letter from a federal agency that could spend years investigating your operations.  

Be that as it may, the FTC warns the search engines that they must "clearly and prominently" distinguish paid advertising from "natural" search results, referred to for some reason as "organic" results by the technorati, saying that it is getting harder and harder for consumers to tell the difference.

Failing to do so "could be a deceptive practice," the consumer protection agency said. It called for "visual cues, labels, or other techniques to effectively distinguish advertisements, in order to avoid misleading consumers."

Growing tendency

The FTC said that over the last year or so, there has been a growing tendency for search engines to put paid listings above "natural" search results, causing users to think the ads are objective, unpaid search results.

Last year, Google revised its Shopping search service so that it includes only paid listings, thereby making it possible that consumers will not be shown the very best deals on a given item. The only indication that this is the case is a bit of grey text that says "sponsored" at the top right.

No doubt Google would be unhappy if news sites began writing only about politicians who paid to have stories written about them but it does not seem to feel any compunction about presenting only sponsored shopping information to consumers. 

"Consumers ordinarily expect that natural search results are included and ranked based on relevance to a search query, not based on payment from a third party," the FTC said in its letter. "Including or ranking a search result in whole or in part based on payment is a form of advertising. To avoid the potential for deception, consumers should be able to easily distinguish a natural search result from advertising that a search engine delivers."

Besides Google, the letter went to Yahoo, Bing, AOL, Blekko, DuckDuckGo and 17 specialized search engines. Google dominates search engine advertising with about 74% of the $17 billion spent annually on ads and paid search results.

In January, the FTC wound up a two-year antitrust probe of Google, saying it found no basis for action.