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2002 In Review: Google Powers AOL; AdWords Go Cost-Per-Click
This article is part of a series, a review of the 2000 decade and search developments. Below, major events from the year 2002 in consumer search. For the complete series, see the introduction, The Google Decade: Search In Review, 2000 To 2009.
Google Powers AOL Search
The deal for Google to provide search results for AOL Search was the big story of 2002. It showed the necessity of being a “single solution” provider to portals and others without their own search technology. It also tipped Google’s share of the search marketplace over 50%, when you factored in all of its partners.
Both Overture and Inktomi previously had deals with AOL. Overture provided paid listings. Inktomi provided editorial results. As divided solutions, they were less compelling. Indeed, both companies eventually got purchased by Yahoo, giving it a single solution. But by that point, the days of being a big search player by “powering” others were ending. The big search players were becoming synonymous with those who owned their own technology.
AdWords Goes Cost-Per-Click
Google rolling out CPC-based AdWords was another major story this year. Overture had built a de facto standard of buying paid listings on a cost-per-click basis. AdWords sold on a cost-per-impression basis. By shifting to CPC, AdWords tapped into that standard and became more compelling to many advertisers.
Google’s Too Powerful
Yes, years and years ago, people were already screaming that Google was too big, too powerful, too scary. And it didn’t even have its own browser, web applications and mobile phone then! This was a big story in 2002 mainly because it popped within selected technology and search circles. It took longer to emerge in a more general publications. Even today, it still hasn’t become a major issue to most people in general, I’d say.
What things tipped Google into being seen as too powerful? For one, the company pulled pages that the Church Of Scientology said violated its copyrights. Google later restored those pages and also became the only major search engine to disclose when content is removed due to legal issues. Still, the action raised concerns.
Google also got censored by China. The company didn’t cooperate with that, but it raised issues about whether it would in the future. Google eventually did, sparking a huge outcry. Last month, Google declared that cooperation on censorship would end.
Google also got sued for deliberately reducing the PageRank scores of sites involved in a network designed to buy and sell links. It was the first shot against paid links in a war that has continued ever since — and a war that has caused Google to be seen in some quarters as trying to dictate what publishers can and can’t do with their own web sites.
Even more issues got raised. Body Shop founder Anita Roddick had her ads pulled because of a comment on her web site that was deemed anti-John Malkovich, in violation of Google’s guidelines then that barred advertising any site that was anti-anything. Also, Google Watch was born, a site rallying that Google had too much power, that it needed to be stopped.
In a round-up article that year, I wrote:
Google’s biggest challenge may be that so many people now see it as the only search engine that “matters,” a marketplace dominance in search that seems akin to that which Microsoft has with operating systems, office software and web browsers.
Microsoft’s supremacy as a company has caused it to be widely loathed. Does search dominance by Google mean that the company is destined to face general hatred, as well? Such a fate is not preordained, as we shall see.
Articles of a similar nature appear today, showing that things haven’t changed much. Similarly, Google CEO Eric Schmidt told me this at that time:
We have very poor lock in. Microsoft has very high lock in … The switchover cost for you to move to one of our competitors is none. As long as the switchover costs are so low, we run scared. Everyday I wonder if there are very smart people at Berkeley coming up with a new algorithm.
Google makes similar statements today to explain why they aren’t a monopoly, aren’t a company that should be feared but which don’t acknowledge the habit Google has become, a habit that’s tough to break.
Search Marketing Meets The Law
Another big story this year was that search marketing matured further with legal rulings and actions. Mark Nutritional filed the first major lawsuit over ads linked to trademarked terms, a $440 million suit against AltaVista, FindWhat, Kanoodle and Overture. It was never settled due to the later closure of the company by the Federal Trade Commission.
Over at LookSmart, it unilaterally decided that a one-time fee to be listed could be changed to mean that LookSmart could charge you over-and-over again. Search marketers objected; a class action lawsuit resulted, which was later settled.
A legal ruling was also handed down giving relief to those who used trademarked terms in meta tags, though that didn’t end those types of suits. The ruling involved Playboy suing former Playboy Playmate Terri Welles. It was found she had every right to use the words “playboy” and “playmate” in her meta keywords tag and on her web site. Trivia item: I was her expert witness in the case.
The biggest legal story of this year was the FTC declaring that all those search ads on search engines needed to clearly provide disclosures that they WERE ads. It was landmark guidance that shaped the paid search space greatly, even though I fear today, those guidelines are being forgotten.
Google Bombs Get A Name!