Ad-Words and Brand Confusion - Essay Example

Ad-Words and Brand Confusion Table of Contents Introduction 1 Search Engines 2 Google, Inc 3 Ad-Words 5 The Debate 6 Legal Battles 9 Implications 10 Conclusion 14 References 15 Bibliography 18 Introduction In the present world of today, the only term that is considered to be constant is ‘change’. Almost every aspect of life as well as business has experienced major changes in last few years. The tremendous development that was experienced in the field of information technology and communication process has initiated major transformation in the tricks and terms of trade of the industry. Along with such developments, the increasing effect of globalization has made the world to be a real small place to live in just within the few clicks of the mouse. The increasing effect of all these changes have almost wiped off the geographical borders of the nations and the entire domain of trade and business has become a transnational issue. Along with such developments and changes, one cannot deny the role played by the internet. In fact, it is the internet that has acted as the most important facilitator of change in the development of information technology. The witty business leaders of the world has used internet as the medium of business and the truth is such an effort has changed almost the entire dynamics of traditional way of doing business. As it is widely accepted fact that internet is the huge pool of information. In order to make internet convenient to use for the users, the search engines came in to existence in the previous decade. The search engines facilitate the search of the relevant information for the user. For the purpose, the user has to type the key words of the information that he wants to get hold of. But there is a major possibility that such key words are already trademarked by certain organizations and those words cannot be used in such a way. Moreover, of late the search engines are charging fees for such keywords which have turned out to be one of the prime sources of revenue for such search engines. This way of doing business has resulted in major controversies all across the globe. The report provides deep insight over the matter and unfolds various interesting facts in the course of discussion. Search Engines The revolution of the internet business commenced with that of the search engines. In simple words, search engines help the end user with the relevant websites or the source of information as he enters certain key words in the ‘search’ option. The search engines were first developed in the year of 1993 in the form of Aliweb and JumpStation. Prior to the developments of search engines, a complete and extensive list of web servers were used to locate the websites. In the year of 1993 itself, before the launch of Aliweb and JumpStation, Achie and Veronica were launched. But with respect to real search engines, it was Aliweb to be the first one to be launched in November, 1993. Among other prominent search engines that were launched in the decade were that of Lycos (in the year of 1994) and Altavista (in 1995). But the real change came with the launch of Google in the year of 1998. This search engine with its page rank system of algorithm made a revolution in the entire domain of search engine. Also it considerably influenced the business in the field. After Google, the search engines of Yahoo! in the year of 2004 and that of the Microsoft (with the name MSN) also marked their presence. Google, Inc As discussed earlier, Google changed the entire scheme of things in the scenario of business of search engines. It was founded in the year of 1998 as a privately held company by two students of Stanford University named Larry Page and Sergey Brin. The company, which in future becomes one of the most influential brands of the entire world, came up with its first initial public offering in 2004. Today, the company caters to the ever increasing global market with the services like social networking, e-mail, online mapping, office productivity, domain names, analytics and video sharing among many others and has the declared mission, “to organize the world’s information and make it universally accessible and useful”. 1 The company which has almost 20,000 employees all around the world has been repeatedly named by the Fortune Magazine as the ‘best place to work for’. 2 Also the company has won the title of the ‘most powerful brand of the world’ by the organization named Brandz. 3 Even though being a market leader in the business domain, Google has often been rocked by controversies one after the other. The company has been accused of the divulging one’s personal data to other parties. Also, the company has been criticized over the issues of copyright and censorship time and again. Recently the company has been massively criticized for their decision to sale key words (most importantly those already with trade marks) to the rival and competing brands. But the fact cannot be denied that the most important source of revenue for the company is through the advertisement of ad-words. Ad-Words It has been an open secret today that the majority of revenue of one of the most famed companies of the world comes in the way of advertisements. Google, Inc had named the advertisement program as the ‘Google AdWords’. According to the information available at the corporate website of the company, those willing to advertise at the most reputed search engine ‘bids in an open and competitive auction’ so that their advertisements appear on the monitor when a key word is searched. For the purpose of advertisement, Google has devised the heads like ‘sponsored links’ and ‘Ads by Google’ and the company website claims that they never sell the ad slots in their search engine results neither they accept money from the advertisers to have higher ranking upon the search mechanism. 4 Rather, the company claims that millions of advertisers are benefited from the advertisement campaign as devised by the company in order to promote their products and services on the internet as the campaign has universal reach. Along with the AdWords campaign, the Google in partnership with thousands of online partners run one of the most elaborate Ad Sense programs. The AdSense program allows advertisements from the AdWords to other sites that are relevant in lieu of content or search result. Consequently, this mode of advertisements is very helpful to the advertisers as it increases reach by great extent. The company also has initiated advertisements through many other means like YouTube, Google Analytics, Insights for Search, Ad Planner and Website Optimizer. The Debate It has been observed that the search engines are selling the key words that have been long trademarked, so that it appears as advertisements when a person initiates a search on such engines. The situation has infuriated the trademark holders in the United States and Europe. And the fact is that Google has led such advertisements with the schemes like AdWords and others. At the outset, such advertisement practice commenced in United States and Canada and later, also it was introduced to the United Kingdom (England and Ireland). The situation has encapsulated whole lot of industries from luxury products to insurance companies and from travel companies to home decoration organizations. In simple words, the concept also known as ‘trademark keying’ can be defined as “the sale of search results and advertising linked to searches based on product names and trademarks”. 5 The arguments that the search engines put forward for such a way of advertisement is that it enables the searcher to find the most relevant and informative results. The measure to defend such a way of advertising is quite obvious for the search engines as such ads bring the major chunk of the revenue for the search engines. But the owners of the trademarks are too infuriated to accept the fact. On the flip side, the trademark owners feel that because of such unethical way of online advertising, their hard work and investment of so many years are at stake. As the terms for which such companies have achieved trademarks, when initiated on search, finds many of the rival companies and other similar links are displayed as the sponsored links or as the Ads by Google. Such a case has made the legal owners of the trademarks to perceive that there investment and hard work towards brand creation and building of goodwill is being duly misused. Many of such trademark owners have believed that such way of advertisements have created confusion among the public in general as it not only clearly breaches the trademark and copyright rules but also tantamount to infringements of such rules. Google, being the most used search engine of today’s world has been the target of the trademark holders for long. The company relaxed the policy of preventing the trademark keying in the year of 2004 and demonstrated the importance of online advertising that was invariably related with the keywords thereby allowing the advertisers of the United States and Canada to bid on the trademarked names that belonged to other parties without any sort of restrictions whatsoever. 6 It can be observed that the company has distanced itself from the issue very cunningly and transferred the entire load of responsibilities of the matter upon the shoulders of the advertisers as it has maintained that it is the advertisers themselves who decides upon the contents that is to be used in the advertisements and are therefore themselves responsible with the formulation of the key words and the company has nothing to do with such a thing. 7 Being at the top in the business of search engines, Google has been the target time and again against the infringements of copyright and trademarks by the owners of those intellectual property rights as it implements relaxed trademark keying norms. The one of the most influential brands of the world, Google maintains that the business of such advertisements is perfectly legal till the time that the user of the search engine is not fooled or deceived in to believing an advertisement, been placed by the competing or the rival brands. It implies that till the time the end – user or the information searcher does not gets confused by the inter – relation of keywords and adwords, there is no harm in such way of online advertisements. 8 But the experts of the concerned affairs view the stance taken by the Google as the way of shrewd defense. According to them, such a statement by the company is just to protect their main source of revenue generation as many of the analysts are of the view that if such keying of the trademarks are prohibited by the court of law in the various parts of the world, the business of the company is going to take a major hurt. 9 Legal Battles As discussed earlier, the alleged keyword and trademark infringement has led to whole lot of legal battles and law suits in the United States of America and that of Europe especially in France. However the court cases have not led to any full – proof solution to the issue. The legal battle in between American Blind & Wallpaper Factory and Google, Inc is important in this respect that erupted in the year of 2005. The American Blind and Wallpaper, one of the major online sellers of window treatments and wall coverings, complained that adwords program initiated by the search engine giant Google, takes advantage of its trademarks by permitting and encouraging the rival companies to buy almost similar adwords to that used by American Blind & Wall Paper Factory. The company claimed the entire process initiated by Google, Inc is thoroughly illegal. The other major allegation that the seller of window treatments and wall coverings had against Google was that the search engine directed the internet users and information searchers, when they typed certain key words, to the pages of the competitors of the company. According to the claims made by the American Blind, such competitors paid Google for the advertisements. But the district judge rejected the summary judgment motion as forwarded by Google only to dismiss claims made by American Blind & Wall Paper Factory of infringement of trademarks, dilution and false representation. 10 Along with the United States, many of the legal battles also erupted in the European nations especially in France that involved Google, Inc and other parties over the issues relating to key words and adwords. In the year of 2005 in a similar situation a lower court of France penalized Google a hefty amount under the charges of counterfeiting of trademark, advertisements that were misleading and unfair competition. 11 An owner of a trademark named Louis Vuitton Malletier had complained at the court of law that users of Google France, who have searched by the trademarked terms of it, were directed to the paid advertisements that were related with selling counterfeit luxury products. The case was won by Louis Vuitton as Google France was ordered to pay € 200,000 to the affected company in addition to the cost of breach for trademark. The court of law also debarred Google to show any advertisements of the competitors of Louis Vuitton when a person enters any of the registered trademarks or names of the company for example Vuitton or LV among others. 12 Implications The allegations of trademark infringements have led to whole lot of court cases all over the Europe. Among the cases in England, the remarkable was one that involved Marks & Spencer and that of Interflora. With time the cases were passed to the European Court of Justice. In fact, it was the French Court to pass the first cases to the International Court. The Advocate General of the International Court of Justice is observed to have the opinion that Google or the advertisers do not commit any trademark or copyright infringement by permitting the advertisers to select the keywords even if they are registered previously. The Advocate General is also of the view that Google have not committed any offense by showing advertisements those triggered by the key words or the adwords. Such verdict can be analysed on the light of certain relevant issue as discussed below: Selection – The Advocate General held the view that the selection of adwords is totally confidential among the advertisers and the Google. Such deals are always under cover and the general public never comes to know about the minute details. In such a scenario, even if the adwords collide with the trademarked words, they cannot be called as the trademark infringements, thought the Advocate General. Display – The supposedly strong case that the trademark holders filed against Google, of displaying such advertisements were violating the trademark laws was also written off by the Advocate General. According to him, the exhibition of advertisements or the natural search results, on being searched with keywords that stimulates with those trademarked, does not create any confusion against the original producer of goods and services. The Advocate General is of the firm view that such act does not collide with trademark laws and therefore there is no chance of trademark infringements at all. Liability – The Advocate General has clearly opined in favor of Google in terms of search engine results and the issues of key words. But also it has been clearly mentioned that such exemption of responsibility of the search engine major does not apply when it comes to the ‘sponsored links’ or ‘ads by Google’ as in those cases the search engine is paid by the advertisers so that their link appears on the screen. According to the Advocate General, the company should remain neutral in case of normal search. But it cannot claim protection in case of adwords from the E-Commerce directive. 13 Another significant case in this regard has been that of the Napster, Inc. Napster was involved with sharing and downloading of music on internet. The industry of music sued the company on the charges of copyright infringement. According to the industry, copyrighted sound tracks and music were provided for free to the listeners by Napster. The honorable court though Napster to violate the terms by both ‘contributory infringement’ as well as ‘vicarious infringement’ and it ordered Napster to stop the way of doing business as it was illegal according to the Audio Home Recording Act and Digital Millennium Copyright Act. It is perceived that the court never looked in to the defense of Napster and its innovative way of doing business. The industry feels yet lot is to be clarified in such respect as the laws are not enough holistic. 14 Google, Inc has made it very clear that the company supports the copyrights. The company maintains that it is easy to allege about copyright infringement but it has deep concerns over the procedure of handling it. It is so because copy right laws are complex and more over no judges are involved with the disconnection proceedings. The company claims that there have been many instances where improper allegations were charged against the so called ‘offenders’ because of such complexity of the laws. 15 The music industry is undoubtedly one of the most booming industries. There are lot many websites and companies that are into the business of free sharing of the music. Now, most of the music is copyrighted to one or the other company. So, there always lies the collision of copyright infringement. The government and the regulatory authorities should initiate apt measures to formulate comprehensive laws in this regard. The law should take its own course of action and even of the law breaker is a music enthusiast, he should be punished as per the law. In the case of CBS Songs Ltd and Others v Amstrad Consumer Electronics Plc, the plaintiffs had claimed that the defendants had offended the Copyright Act, 1956 as they authorized public to infringe the copyright. But in the case it was held, no such authorization to infringement was committed as there were no joint infringers (at least in absence of common design). 16 Conclusion With the context of present happenings in the world of internet marketing with special emphasis in the fields of AdWords, it is certain that the marketers will definitely use the tool to advertise their products. It is also expected that the conflict between the search engines and the brand owners will not reach to the extreme point and the brand owners would leave the policy of suing the search engines. Rather they should initiate measures to utilize the maximum benefits of search engine optimizations. References Anderson, “Google: Internet disconnection a "disproportionate" penalty”. (2009) Ars Technica Brandz Top 100 Brand Ranking, “Brandz Top Ten Most Powerful Brand”. (2004) Executive Summary. Crews, “A&M Records, Inc. v. Napster, Inc.: Implications for the Digital Music Library”. (2001) Indiana University of Law. < http://www.dml.indiana.edu/pdf/AnalysisOfNapsterDecision.pdf> David A. Vise, “Firms Sue Google for Ad Links to Competitors”. (2004) The Washington Post. Frost, Laurence. “Google May Appeal Trademark Decision”. (2005) MSNBC. Fortune, “100 Best Companies to Work for 2007”. (2007) Full List. Google, “Company Overview”. (2009) Corporate Information. Google Inc., “Form S-1 Registration Statement Under the Securities Act of 1933 10” (2004) Securities and Exchange Commission. Google, Inc., “Trademark Complaint Procedure”. (2004). What is Google's AdWords and AdSense trademark policy? Hansel, David & Panayi,Christian. “Are AdWords Bad Words”. (2009) Perfect Storm. Intellectual Property Office, “CBS Songs Ltd and Others v Amstrad Consumer Electronics Plc” (1988). IpCass. Keenan, Terrace J., “American and French Perspectives on Trademark Keying: The Courts Leave Business Searching for Answers” (2005) Shidler Journal of Law. Matthew, Broersma, “Ruling Against Google Could Bring Dire Consequences”. 2005. eWeek. Bibliography Battelle, John. “Will Google Ban Trade in Trademarks?”. (2004) Battelle Media. Bartholomew, Mark. “Making a Mark in the Internet Economy: A Trademark Analysis of Search Engine Advertsing”. (2009) Oklahoma Law Review. Lastowka, Greg. “Google’s Law”. (2009) Social Science Research Network. Moffat, Viva, R. “Regulating Search”. (2009) Harvard Journal of Law & Technology. McGeveran, William. “Rethinking Trademark Fair Use”. (2009) University of Iowa. Read More