Google changes policy on keyword bidding

In May 2008, Google, the UK’s dominant search engine provider with a greater than a 90% market share, changed its policy of monitoring the sale of brand names.  This is a seismic shift in the ability of trade mark proprietors to prevent third parties from using their brand online.  As a consequence, responsibility for monitoring use has shifted from Google to the brand owners themselves.

Google’s success is underpinned by the sales of advertisements to appear next to search results as ‘Sponsored Links’.  Historically, Google’s trade mark complaint investigations department would monitor and restrain businesses from bidding on keywords which correspond to competitors’ brands.  Now, businesses may purchase advertising space next to search engine results for their competitors brand names.

The effect is that competitors’ advertisements may appear above the brand owner’s link following a search using the brand owner’s details.  In order to appear above the competitor, brand owners must bid a higher price.  And that means spending more money.  Businesses which have invested substantial amounts in building their brand profile object to that behaviour, which they see as ‘riding their coat tails’.  They must now resort to bringing infringement proceedings to prove that their trade marks are being used unlawfully.

Expect big brand owners to challenge Google’s amended service.  It has deep pockets and something tells me that this will go all the way…

All iPit posts on Google AdWords can be found here.

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