UPDATED: Google has increased by 190 the number of countries in which advertisers will be able to pay for their ads to appear when a rival's trade mark is typed into its search engine. That policy previously only applied in the US, Canada, the UK and Ireland.
Google will still investigate the use of trade marked terms to trigger adverts in every EU member state apart from the UK and Ireland, and in some other countries including China, New Zealand and Australia.
Google's search engine shows the natural results of a search, which cannot be changed. Beside these, the company displays adverts triggered by whatever terms were searched for. Companies pay for the right to display their ads alongside results for specified terms, known as keywords.
Until now Google investigated complaints from trade mark owners if another party sponsored their trade mark as a keyword. Its policy change means that it will no longer investigate such complaints and brand holders will have to compete to have their ads appear beside searches for their trade marks in most countries.
Google said that it was giving companies one month in which to prepare for the change. "As of 4 June, Google will no longer review keyword lists for monitored trademarks in these countries. This will bring these countries into line with the US, Canada, UK & Ireland who already employ this policy," said a Google statement.
"In the EU (excluding the UK & Ireland, where this change happened in 2008), Switzerland, Australia, China, Brazil, Norway, Iceland, Lichtenstein, New Zealand, Taiwan and both Koreas, the trademark policy will continue as is. Google will continue to review the keyword lists of advertisers outside the UK & Ireland and will not allow unauthorized advertisers to select monitored trademarked terms," it said.
The change allows companies to use a rival's trade mark as a keyword, but companies can still be stopped from using other firms' trade marks in the adverts themselves.
Google made the same change in the UK and Ireland in 2008 in a move that took away brand owners' monopolies over of their own terms.
Companies feared that the change would lead to a significant rise in keyword advertising costs, but digital marketing agency Bigmouthmedia said that rises were short-lived.
"While dropping trade mark protection didn’t send costs skyrocketing to the extent many feared in the UK, during the initial scramble to bid on competitor brand terms we saw cost-per-click prices rise by an average of 400–500%," said the company's chief operations officer Lyndsay Menzies. "Those levels proved unsustainable in the long term however, and we would expect any spike in keyword prices to normalise within a matter of weeks."
Editor's note, 07/05/2009: A reader in Austria, Maximilian Schubert, author of Austrotrabant's blog, points out that advertisers have always been able to sponsor third party's trade marks as keywords, even in countries like Germany and France. They can continue to do so, notes Maximilian. It is only when there is a complaint from the trade mark owner that Google will take action in these countries.
Once a trade mark has been the subject of a keyword complaint, it is believed that Google prevents other advertisers from bidding on that mark in that country. However, we do not know for certain if that is the case, or at least if Google follows this approach in all cases. If you know, please say.
Editor's note, 08/05/2009: Michele Neylon of Ireland's Blacknight Solutions has provided an answer to our question:
"We took advantage of the protection in Ireland prior to the policy change and basically it blocked any advertiser from using the keywords in question, so all ads with those keywords simply stopped appearing. Once the policy was changed we then had to manually pursue the infringing parties, which was more than a little annoying."