Updates to this story
Google has announced today that it will be allowing users of its online advertising schemes to register brand names of other companies as keywords, which is sure to step on many toes as far as trademarking is concerned.
What this effectively means is that a company could display its ads on searches for a rival company's brand. A search for “iPhone”, for example, could bring up third-party iPhone sellers or even ads for a BlackBerry or Android device, if the latter pay to use the brand search term.
“This is beneficial to users,” said Ben Novick, a spokesperson for Google at a press conference in Paris. “They'll see more relevant ads when they've done a search.”
The move follows a court ruling in late March when the European Court of Justice decided that Google was entitled to allow any of its customers to use search terms relating to rival brands and that it did not infringe on European trademark laws.
At the time Google revealed its thoughts on the matter: “The question before the court was whether advertisers should be allowed to choose keywords freely when reaching out to users on the Internet. In other words, if advertisers are allowed to show advertisements when another company's brand name is entered as a search query.”
It said that it belives users are “best served” by maximising keyword choices. “For instance, if a user is searching for information about a particular car, he or she will want more than just that car’s website. They might be looking for different dealers that sell that car, second hand cars, reviews about the car or looking for information about other cars in the same category.”
Google's current system allows for companies to demand removal of their brand name from the keyword list, which means rivals cannot buy their search terms in order to place competing ads. This system could be criticised as having potential antitrust qualities, since it prevents competing advertisements which may ultimately benefit the consumer.
Of course, with more competition for advertisements targeted at rival brands, Google is certain to gain a significant boost to revenue, which is much more likely the reason behind its move today.
These changes are set to come into effect in the 27 European Union member states from September 14, but it's not clear how this will affect other regions. It may have succeeded in the European courts, but big name companies are likely to sue it in other large markets, such as the US, considering how much money is involved in branding. It seems apparent from this move, however, that Google is confident that it can win those legal battles too.