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JJ Ramberg

JJ Ramberg is the anchor of “Your Business,” MSNBC’s weekly show on small business. In addition to her extensive television reporting experience, Ramberg has a background as an entrepreneur and co-founded GoodSearch.com. She has an MBA from Stanford Business School.



Is anyone worried about the Google ad gorilla?

Posted: Thursday, July 03, 2008 12:05 PM by Eve Tahmincioglu
Filed Under: , , ,

Last week a congressional panel brought together small business representatives to discuss the growing dominance of Google and Yahoo when it comes to Web ads.

The two search engines, with Google clearly at the forefront, pretty much are the only real choices business owners have if they want to hawk their wares on the Web.

Rep. Charlie Gonzalez D-Texas, chairman of subcommittee that held the hearing, questioned whether new laws are needed to make sure small firms don’t get pummeled in what is shaping up to be a Web advertising monopoly.

But after listening to the hearing on YouTube it seemed like none of the so-called small business representatives were all that worried about the Google ad gorilla.

A lot of the testimony was about how great Google and Yahoo are when it comes to innovation.

The harshest words seem to come from the politicians.

This is from a statement released by Gonzales’ office on the day of the hearings: “A principal challenge for small businesses is gaining prime spots on the Web pages of search engines. Because media giants such as Google and Yahoo dominate the online advertising field, their policies can dictate online strategy for small companies.”

I e-mailed congressional staffer Jaime Zapata about the lack of small business outrage. I figured maybe I missed that part of the hearing.

"I couldn't find any witnesses that are worried about Google and Yahoo's dominance," I wrote. "Did I miss this?"

“I’d say that’s a fair read on the hearing," Zapata replies. "Concern yes. ... call for regulation—not so much. Some highlighting of the importance of a diverse e-business model, but all in all—no Google- or Yahoo-bashing."

Even Gonzales seemed perplexed.

“Maybe we don’t have to do anything, but  I think we have to watch it carefully,” he said during the hearing. “The basic principle in Washington we adhere to, and that is competition is a good thing.”

Gonzales even quoted Rob Pegoraro, the Fast Forward columnist at the Washington Post, to make his point:

"It's not that Google is some tyrannical monopolist that must be brought to justice. This company has come to dominate the markets for Web search, advertising and many other services fairly, by providing quality products at a fair price (which, for most Web users, is free). It's moved when others have stood still: Imagine, for instance, how limited Web-mail and online mapping would be if Google hadn't reinvented each category earlier this decade.

"But that doesn't mean that I want it to run away with the rest of the market. It's fundamentally unhealthy for any one company, even one that claims to have 'Don't Be Evil' stamped on its corporate DNA, to amount to the crossroads of the Internet."

Maybe the whole Web-advertising arena is just too new, and maybe things are happening just too quickly.

Small business owners’ heads are spinning when it comes to this new world.

Few people could have predicted early on how Microsoft would come to dominate the world of personal computing.

Google may not be thumping its chest right now, but all gorillas have to eventually, no?

(Msnbc.com is a joint venture of Microsoft and NBC Universal.)

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Comments

maybe we need more laws to keep watch on the politicians,it seem when they are not involed things
move along just fine.

emilio deangelis (Sent Thursday, July 03, 2008 3:35 PM)

Okay, so everybody knows that Microsoft is battling to gain market shares of the online ad business, right?  Right.  Well, is everybody else aware that MSNBC is 50% owned by Microsoft?  I mention this because Eve Tahmincioglu's opinion of Google, before even reading her article, comes off as biased with the reason being who she works for.

I think that Google has the right to do what they like as long as they don't act like Microsoft did when they were trying to monopolize everything way back in the day (up to 2006).  Writers like Eve who try to instill fear in consumers don't realize that the only people who REALLY care are the businesses paying for online ads and not consumers.  So small and big businesses want more online ad compitition so they get lower rates, but who cares?!  

Get a life and start writing something that matters and won't be concieved as biased and a conflict of interest.

James, LA, Califonia (Sent Thursday, July 03, 2008 8:17 PM)

Yahoo used to be the big search engine. Then Google became more convenient. If Google becomes obtrusive or inconvenient or any number of other "bad" things, users will just switch to the next up-and-comer. That's what is so great about a free internet service - there is always another one out there doing a similar job. Google is just the best one right now, and their innovations are keeping them the best - right now.

Ashley Kirk, Sioux City, IA (Sent Friday, July 04, 2008 2:16 PM)

Not enough information here.  Google is raking in easily millions in ad dollars from so obviously copywritten material that we've just come to accept the fact.  But Google is banging huge bucks there as whose expense?   For the most part Google is run by people far more intelligent than any politician or economist.  That is both good (hurray for smart business) and something to be concerned about (well, evil can be smart too).

I've spent over a quarter mil with google in ad sales thru my job, and I still would rather keep them at arm's length.  Power is just something you should keep your eye on.

Tom, ATL, GA (Sent Friday, July 04, 2008 3:11 PM)

No complaints from small businessess - Could be that either that they could not afford to attend, or did not know about the meetings. Very small business do not normally belong to associations or groups

Southampton (Sent Friday, July 04, 2008 6:20 PM)

I dont use google personally, and I have reconfigured the DNS servers at work so that when people try to go there, they get redirected to live dot com. I used wensense to block all the google ad sites.

I know its only 500 users, but...

Just doing my part :)

Mark Robbins (Sent Saturday, July 05, 2008 5:48 PM)

I'm tired of clicking on a link,only to be directed to some ad or sales page... just link me up with what I wanted to see, not some ad trying to sell me something.... Are these guys stupid or what??? I just highlight the link and then put it in myself... tooo frustrating!!!

Alex Daniels, Farmington, NM (Sent Sunday, July 06, 2008 1:22 AM)

We used to like Yahoo when they rated our Web site by content. We made money and Yahoo made money.  But now that they rate us like Google always had, only by what is in it for them, we can no longer afford either one of them.

Some items, such as educational courses, simply are not blockbusters and never will rank high. Compamies like Google, Yahoo, and Microsoft should realize that and adjust their policies at bit more towards the social good and not just their pocketbooks.  When one is as big and powerful as Google some social responsibility has to come into play as well.

Ralph, Sunnyvale, Calif. (Sent Sunday, July 06, 2008 2:54 PM)

Advertising is private enterprise and should not be controlled, the market will adjust things that get out of balance.  The problem for me is search engines.  As a small business trying to get started naturesartandgifts.com I am told that I will have to spend a lot more money to buy ads on Google or let them put things on my pages I have no control of.

Bob Waits, Boulder City, Nevada (Sent Sunday, July 06, 2008 3:48 PM)


Googel has archieve dozens of my web pages and gives me good coverage.  I neither sell anything or promote any business but since I have a fairly high hit count google gives me a good representation on their search engine.

I really do not see what the problem is.  I haven't paid a penny for my google presence.

BB / www.biddlesbank.com

BB (Sent Sunday, July 06, 2008 4:33 PM)

someday people will realize that no one ever clicks on any of those web ads, unless they're sneaky and then the viewer feels deceived.  An informal poll of 4 friends revealed we have clicked exactly 1 adsense advert / banner ad in the last year.  

Advertisers are seriously wasting money, and when they realize that the web is not a very strong medium for conferring business growth through advertising, there won't be any monopolies and instead it will fall back to tiered and targetted advertising

ad sense, Suxupahat, Wi (Sent Monday, July 07, 2008 12:51 AM)

@James, LA, Califonia
So you are telling me that Google implanting their darn toolbar in every type of consumer install is a fair practice? Yahoo does the same thing but Google has hit wider used software companies such as Adobe. The everyday user who tries to open a pdf document or even install Adobe Flash is automatically prompted for Google's toolbar. Oh, and if you install Apple's QuickTime software you get an auto yes Google toolbar install.
It is a lie to think that those things don't effect the masses. Any basic computer user usually has multiple search toolbars installed and use those by default. Yeah, they had a choice to select the non-bolded "No" statement but left it on the bold "Yes".
I do not think that is a fair practice.

As for your comment on the author being bias...
"It's moved when others have stood still: Imagine, for instance, how limited Web-mail and online mapping would be if Google hadn't reinvented each category earlier this decade."
Uh, why would she mention Google reinventing each category..? Microsoft has been so far ahead of the mapping software. Unfortunately they did not advertise it as much. And web mail... Microsoft's Outlook Web Access has been around for years and years and years, one of the first full fledged AJAX websites (way before Google). Don't you think a bias person would point that out.

I see bias write ups all the time. They are not even remotely vague and range from the gadget styled blogs to the New York Times.

The main concern is that the Small Business owners aren't aware of these new repercussions.

Zac, Orlando, FL (Sent Monday, July 07, 2008 5:26 PM)

Google is a multi-billion dollar company because if you are a small business owner, you need to give them all of your profit if you want to show up on their search engine.

As a twenty year owner and founder of a family business which has been fairly stable if not rich over the years, our sales suddenly dropped when some internet competitors popped out of nowhere and essentially took over the online market. We eventually found out it was due to sponsored advertising and so we started bidding too.  Eventually all the companies were trying to outbid each other and last year, for the first time in 10 years, we lost money. Our competitors, who don't even have a storefront, also rank much higher for some reason. So it turns out its all about 'search engine optimization', and you have to pay tens of thousands of dollars to get someone to manage that for you.  Unfortunately, we lost so much bidding for the sponsored links that we can't afford to do that.  And what does a high ranking have anything to do with the quality of the product anyway?  Now we are on the verge of going bankrupt because the money that should be going into my retirement fund is now going to Google and Sergei Brin.  U.S. lawmakers need to disallow search engines from owning sponsored listings, and also force them to accept sponsored listing from other companies the same way that Microsoft was forced to make other companies' software available on their operating system.  Google basically has a monopoly in the search engine market and is piggybacking its sponsored search listings off that.

Craig Felton, Seattle WA (Sent Monday, July 07, 2008 9:13 PM)

Some sort of regulation needs to occur, I am tired of being told I need to install one program, in order to get another program for free.  I am also sick and tired of being directed towards place holders when I run a search and am off by a character.  Congress needs to worry more about how much they are screwing the American Public over, and allowing deceptive ads over public air ways.  When ad's appear on television, promoting certain items, but cannot be confirmed by our government, because they our herbal, and the gov't has no control over them, then I wonder about the sanctity of our system.  

Screw this, Winfield, MO (Sent Tuesday, July 08, 2008 1:58 AM)

It greatly amuses me to see people think that just because MSNBC is half owned by Microsoft, that Microsoft has ANY editorial control over the content that is written here. If you ask me, Google has for more selective control about what they choose to display on their news pages. It sure isn't random, and I for one cannot understand why stupid You Tube videos that have little or nothing to do with the news page I am at have to dominate half the page at finance.google.com, for example.

As for Google's 'don't be evil' crap, give me a break. They control web advertising and the only way you get to advertise on their engine is by given them your highest limit credit card you got, which they can charge ANYTIME they want for ANY AMOUNT they chose. Tends of thousands of dollars go into ad-sense ads that have as much penetration as mass snail mails used to have - except at a much higher cost.

It is a beast out of control in which you have to bid for ad space in order to remain competitive, while all the other people out there do the same thing. Dominance true attrition, and the only benefactor is Google, which is all too happy to see those bidding wars go higher and higher for the sake of wrestling mind-share from people. At the end, the company that has the big 'marketing' budget to rid its small competitors wins. That's not how advertising is supposed to be, PERIOD ... but it somehow it has become the norm, and businesses all over are just paying for it like idiots.

It only confirms the marketing people just like to burn money, and they are quite good at it. But in the meantime, mom and pop shops can no longer compete unless they have something truly unique that has no competition from larger companies with deep pockets.

Kaweeka (Sent Tuesday, July 08, 2008 9:55 AM)

There's a new site called ygugu.com where you can add sites for free and even get top ratings without paying a cent.

Jack Straw (Sent Tuesday, July 08, 2008 11:26 AM)

It just seems like our politicians still don't want to take or accept responsibility for the downslide of our economy in many different more FED, Stock and Monetary issues and instead are trying to place the heat on Technology, and that Technology and the Web companies are the sole reasons why small businesses are failing. Because it just can't be that our Gov supports and convinces it's people to start small businesses by convincing them that they'll be protected but when it truly comes down to it, after the Gov gets every penny they can out of a small business they just toss you in the trash and move on to the next.

jacob (Sent Tuesday, July 08, 2008 12:40 PM)

Make a better search engine with a better ad system that will capture more targeted audience to the website I may be trying to drive traffic to and THEN I will use it over Google!

Google has so many options including being able to control what you’re willing to pay for your conversions and from what I can see it is a fair system. Most businesses can spend what they want and grow themselves through Google Ads and most anyone can start a website if they wanted, and if they have good info and keep it updated they could in all fairness create a profitable income using Google AdSense.

Seems to me that Google is helping create a better economic system in the world and maybe that just scares some people who want control over the masses!

Rachelle King (Sent Tuesday, July 08, 2008 12:41 PM)



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