June 23, 2004 6:50 PM PDT

Search engines rethink paid inclusion

Search engines are rethinking a controversial practice of allowing marketers to buy their way into free Web search listings, or programs known as paid inclusion.

Ask Jeeves, one of the largest Web search properties, said Wednesday it will phase out its paid-inclusion program altogether in the coming months after having trimmed it in February. The newly terminated service, called Site Submit, allows marketers to pay an annual fee of $30 to submit a Web address into its search engine.

Industry leader Yahoo is also considering nixing certain fees for commercial Web sites that seek to ensure exposure in the site's free search results, according to several sources close to the company. Yahoo launched a service in early March that offers marketers swifter inclusion in its search index with both an annual flat fee for site review and a "per click" rate each time a visitor clicks on their listing in results.

According to several search engine marketing executives, Yahoo has been considering doing away with the per-click fees on the grounds that many small and medium-size businesses have balked at the traffic tolls.

Yahoo's paid inclusion "has not been well received, primarily because it doesn't feel very Yahoo-like," said Dana Todd, an owner of SiteLab, a search engine marketing company. "They have a review fee and combined it with a traffic charge, and they've made themselves the biggest, fattest paid-inclusion program out there. It seems punitive."

A Yahoo representative said only that the company has not made any changes to its paid-inclusion program.

Critics say paid inclusion can blur the lines between editorial content and advertising. When the programs became popular during the Internet bust, consumer watchdogs attacked search providers, including AOL and Overture Services, for failing to inform visitors of the commercial nature of search listings. The Federal Trade Commission also investigated the major search providers over their paid-inclusion practices and has urged companies to provide adequate disclosure.

Yahoo inherited three paid-inclusion programs when it purchased Inktomi and Overture Services in the last 18 months. It consolidated them and launched the Yahoo content-acquisition program in March that included programs to add free and commercial information into its index. Marketers pay $49 to have Yahoo review one Web address, with lower rates for additional addresses, and between 15 cents and 30 cents per click.

Yahoo rival Google does not offer a paid-inclusion program and its executives have denounced for-fee indexing because of its potential to skew results.

Jim Lanzone, Ask Jeeves' senior vice president of search products, said that the company decided to end its paid inclusion because Teoma--a unit of Ask Jeeves and the engine that powers its search results--has gotten sophisticated enough to find all necessary sites on the Web and refresh them as often as needed. Paid inclusion, he said, poses a conflict for a search engine that promotes the most comprehensive, freshest index to consumers while taking fees from marketers to deliver on that promise.

"Whether it's pay-per-click or a flat fee, it doesn't make sense to draw a distinction of a site in the index--if it's good, it's good. We have to have it anyway; why would we make them pay anything?" said Lanzone, adding that the move will not have a material effect on the company's earnings.

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Paid or not - search result relevancy can no longer be critiqued by Google
"Yahoo rival Google does not offer a paid-inclusion program and its executives have denounced for-fee indexing because of its potential to skew results."

And Google's current results (after the algorithmic changes in February) are not skewed? Google's results are relevant? If you haven't done a Google search lately - don't bother if you are trying to find relevant sites with products and services. Google search now provides you with a "list of lists". Kind of like looking in the yellow pages for a company and all you see are listings for other yellow pages.

For-fee indexing may not be the most popular, but Google can no longer speak about "relevancy" issues with authority.
Posted by BethKn (6 comments )
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