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GoTo Speaks Out On FTC Complaint

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At last month's Online Advertising Forum, GoTo's CEO Ted Meisel fired back at the complaint filed with the Federal Trade Commission over paid listings on some search engines. His comments were both right and wrong on many points.

The crux of Meisel's argument is that users don't care whether results are labeled or not. Put labels on them, and many users will ignore them. They'll mainly judge a search engine over whether its results are relevant and fulfill their search request.

This is absolutely true, but that doesn't negate the need to have disclosure in some way. There are some uses who DO care, and these users deserve to have disclosure as a feature of a search engine in the same way that other features may be offered, even if only a small percentage of visitors make use of them.

Meisel also argued that most search results are influenced by payment one way or another, and he's absolutely right. There is no "level" playing field when it comes to search, nor has their ever been one. As with the traditional media, those who understand search engine "PR" may get better placement in results.

These PR specialists are certainly not paying for coverage in the "editorial" columns of search engines, nor are they guaranteed to get it, but the work they do can have an impact.

However, the point Meisel overlooked is that even though PR can play a role, editorial results are still supposed to be substantially different from the paid listings, at most major search engines. PR specialists do not have free reign, as they do in advertising areas. There is a supposition of editorial criteria, one that the search engines who wish to position themselves as more than web Yellow Pages are supposed to protect. One way to protect this is by clear disclosure, for those who want it.

Meisel was also right that the best way to solve the problem isn't by involving the government, but his solution was the wrong one:

"Rather than get government involved, the right way is, if someone thinks they have a competitive search product, let them market it and let consumers decide," he was quoted as saying, in a Dow Jones article about his speech.

The correct solution would be for the industry itself to solve the problem. Why not simply use clearer words to describe when paid content appears? For instance, let's look at Lycos, one of the search engines named in the FTC complaint, for a search for "anti virus software."

First we are shown "Featured Listings," which are simply paid ad links from GoTo. Next, we are shown "Popular" web sites, and even given a short explanation of what these are: "3 Web sites reviewed by Lycos Editors match your search." Unfortunately, that's not true. The first numbered listing may have been chosen by an editor, but the second two are simply more paid listings from GoTo. There's nothing "popular" or editor-selected about them.

Lycos also has a help page all about its search results, called "What are the various Search Results Page sections?" It makes no mention of what "Featured Sites" are, for those who might care, nor any mention that paid ad links might appear at all.

MSN Search is another search engine named in the FTC complaint, but one that is making a corrective move. Unlike Lycos, MSN Search has disclosed for some time within its help pages exactly what constitutes its "Featured Sites." In fact, last year, it even had an "About" link that appeared next to the "Featured Sites" heading to bring up its disclosure statement.

MSN Search dropped that link because almost no one selected it, the service says. However, it announced at the Search Engine Strategies conference last month that the link would be restored. Indeed, it's now live, and selecting it reveals provides plenty of disclosure and explanation of what appears in this area.

GoTo could be part of the solution by insisting that its partners use certain words or provide better disclosure, at the very least through their help pages. The company hasn't done this in the past, saying the exact wording used is an interface issue for its partners. Of course, making such a push might not be well received by those partners, so from a business standpoint, GoTo probably believes it is taking the wisest course.

That may be wise for GoTo, but it is not for its major partners. "To label paid or not paid is not helpful," the article about Meisel's speech concludes. Well, it certainly would have been helpful to the several services named in the complaint. Had they provided better labeling, they wouldn't have garnered the negative publicity that continues to be generated.

Goto.com Criticizes Watchdog Group For Accusations Against Other Portals
Dow Jones Newswire, Aug. 8, 2001
http://public.wsj.com/sn/y/SB997289501215195355.html

Lycos Help Pages
http://help.lycos.com/LycosHelp/help/search/htdocs/search_1_help.htm

MSN Search: About Featured Sites
http://help.msn.com/EN_US/data/searchv3_2.its51/$content$/featured_sites.htm

Pay For Placement?
http://searchenginewatch.com/resources/paid-listings.html

See the "Paid Placement" section for articles by me and others about the issues involved with paid placement,

AltaVista Launches Paid Listings
The Search Engine Report, May 4, 1999
http://searchenginewatch.com/sereport/99/05-altavista.html

An older article that touches on the myth of the level playing field.


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