This just looks like ads integrated within results – but the examples above are marked as ads better than any other Google search ad. It doesn’t seem sketchy in anyway.

I bet if you showed the average consumer a Google SERP and those screen shots the vast majority would be able to spot the ads much easier in these examples. That’s some of the best disclosure I’ve seen on search ads. If they followed the standard search model they would have highlighted those ads in a way that barely shows in most monitors and put sponsored in the top corner. Instead right when the consumer is ready to click, they see “Ad”. Even if they do roll this out as is I don’t see any “evil”.

On the second point – “sponsored” is clearly better discloser on an ad than “promoted”. Promoted doesn’t even sound paid at all. If you ran the same consumer test as above the vast majority wouldn’t know that was a paid ad.

I wonder whether Google is planning to run those ads under a commission model — both Sears and Kmart offer affiliate programs via ConnectCommerce (aka the Google Affiliate Network).

This P-I “method” made a certain amount of sense because Paid-Inclusion was originally offered to and intended,for companies with tens of thousands or hundreds of thousands of SKU’s that might not get into the search index otherwise. It was Yahoo’s way of saying to large advertisers, “We won’t guarantee you position, but we will guarantee that you will at least get all of your products in the index.” That way, as prices changed, the XML Feed could keep the SE index current.

So long as Google’s Paid Inclusion is limited to similar categories of consumer packaged goods, small parts and appliances, etc., and is deployed simply for purposes of price comparison it may be a justifiable exception to the division of editorial and PPC, church and state. It’s a fuzzy line, though. In recent years, Yahoo rolled out Paid Inclusion for everything from travel to time-share real estate, Strangely, the FTC never weighed in.