• by Tig Tillinghast , July 1, 2002

Last summer, Commercial Alert, a consumer advocate group that’s not at all fond of advertising, launched a complaint against search engines that placed pay-for-placement links confusingly among search results.

While at the time the named sites denied there was any problem, they have now been admonished by the FTC to clean up their act. No formal action is slated to take place, mostly because all those sites that denied there was a problem have all changed their behavior (or at least their link labels) in the intervening months.

My favorite non-response at the time of the complaint came from a Microsoft representative to an AP reporter, telling him that MSN provided “compelling search results that people want.” Which was sort of like answering the question “Hey, did you eat my sandwich?” with “There is hunger in the world.”

So Commercial Alert seems to have won this battle. But this leads to some interesting, and perhaps troubling questions. Their spokesperson, Michael Ruskin said the FTC is “telling search engine companies to adopt clear and conspicuous disclosure for paid listings, under direct threat of possible future commission action."

If that’s true, then it seems to me to be a huge new government foray into the gray world of advertorial. Since there’s no obvious reason why the FTC’s logic would apply to Internet advertising and not, for example, to travel magazine advertising, it appears that there is a new standard for disclosure of payments.

I spoke to Ruskin at the time he initiated the complaint, and he told me that they were trying to limit only a very narrow band of deceptive behavior. This success may have increased his group’s ambitions.

Most travel magazines I’ve seen are thinly guised (and I mean thinly) advertisements for various locations, resorts, cruise ships and tour companies. Should they be revealing advertising relationships? Not that I don’t necessarily think it wouldn’t be a good thing, but it would force those publications to initiate a completely new behavior.

It remains to be seen how widely this FTC admonishment will apply, as it remains to be seen what sort of havoc honesty might create in some quarters.

A note about last week’s column, where I cast doubts on the usefulness of comparing TV CPM’s to Internet CPM’s: It appears I made a faulty assumption about Nielsen’s method for computing viewer ratings, although the correct answer still remains elusive. I had said that a viewer who turned on a channel in the middle of the quarter hour would be counted as having watched the entire 15 minutes. This is, in fact, the method used for some data Nielsen has published, and I now believe I made the improper assumption that this is how their other ratings products worked. However, several very kind media research people have given me several different answers as to how the system really works. I’ve sent an email to an old friend of mine at NMR to get the real scoop. My apologies for the confusion and having been too lazy to get the facts from the horse’s mouth in the first place.