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Google Expands Use Of Trademarked Terms In Ads

Branded keywords are important to advertisers because many searchers use them for navigational purposes, often after being exposed to offline media.

Continuing its dance in the minefield of intellectual property law, Google on Thursday announced a change in its advertising policy to allow advertisers to use trademarks associated with other companies in their ads under certain circumstances.

Google said the change will harmonize its policy on trademark use in ad text with industry standards.

"Under certain criteria, you can use trademark terms in your ad text in the U.S. even if you don't own that trademark or have explicit approval from the trademark owner to use it," Google's Dan Friedman said in a blog post. "This change will help you to create more narrowly targeted ad text that highlights your specific inventory."

It may also make online ads that mention trademarked terms more expensive.

"Branded keywords are important to advertisers because many searchers use them for navigational purposes, often after being exposed to offline media," said Mark Simon, VP of industry relations at search marketing firm Didit, in an e-mail. "Additionally, these terms often function as a kind of 'shorthand' for a generic concept (e.g. to google). Google claims that removing prior restrictions on brand term bidding will improve the user experience, but this step will undoubtedly make achieving top positions for these brand terms more expensive once additional bidders, once barred from displaying branded keywords in their ads, enter the auctions."

Eric Goldman, associate professor at Santa Clara University School of Law, said that in some ways Google's new policy conforms more closely to the ad policies of Yahoo and Microsoft.

"Google was blocking ad copy reference by resellers and other favored advertisers even though in theory those advertisers had every right to talk about the trademark they're selling," he said. "But Google remains idiosyncratic, because for many other circumstances it refuses to block trademarks as keywords, whereas Microsoft and Yahoo have allowed trademark owners to opt out."

Goldman said that Google has proven to be one of the few entities with the power to push back against intellectual property owners. Other groups attempting to push back against intellectual property owners, such as public-interest organizations and academic groups, haven't fared as well in the courts. The passage of the 1998 Copyright Term Extension Act and the Supreme Court ruling upholding it in 2003, for example, represented a major victory for intellectual property holders.

"Google clearly has strong views about intellectual property that often put it opposition to intellectual property owners," Goldman said. "Google has been sued by intellectual property owners repeatedly and gets a lot of negative static from intellectual property owners."

He expects the new policy will continue to rub intellectual property owners the wrong way.

As if to prove that point, Google this week was targeted by two trademark-related lawsuits from a single group of lawyers. Though Goldman believes the timing of the lawsuits and Google's trademark policy change is coincidental, he acknowledges the possibility that this could represent the leading edge of a new wave of litigation against Google.

Then there's the matter of legislation against Google. Goldman expects that the state of Utah, which has tried and failed to pass laws limiting trademark use in online ads, will try again.

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