July 17th, 2001
Group Files Complaint with FTC on Web Search
By Verne Kopytoff
San Francisco Chronicle
A consumer advocacy group filed a complaint with the Federal Trade Commission
yesterday accusing eight popular Internet sites of deceptive advertising.
Commercial Alert, an organization focused on limiting commercialism, said
Web sites such as MSN.com and AltaVista are violating federal law by concealing
the fact that some of their search engine results are actually paid advertisements.
"Many search users think they are getting unbiased search results, when
they are really getting advertisements," said Gary Ruskin, executive director
for Commercial Alert of Portland, Ore. "We want the FTC to require that
search engines disclose that these ads are really ads."
Once relatively objective, search engine results, especially those at the
top of the screen, are increasingly being sold by Internet companies. However,
many search engines do not identify those results as paid and instead use more
oblique terms like "featured sites" and "partner results."
The Web sites cited in the complaint are AltaVista.com, MSN.com, Netscape,
Lycos, IWon.com, Direct Hit, HotBot and LookSmart.
"MSN search is focused on delivering consumers reliable and relevant
search, " said Matt Pilla, a spokesman for Microsoft. "We have an
increasing user base and that shows by and large consumers think we are giving
them good results."
The FTC will examine Commercial Alert’s complaint and determine if an investigation
is needed. In the past, the agency has ordered television stations to identify
infomercials as advertisements but has not done so in the online realm.
"The agency takes deceptive advertising very seriously and you can be
sure the agency will look into this," said Claudia Bourne Farrell, a spokeswoman
for the FTC.