Google’s own advertising: competition, monopoly and fairness

These can take the form of Google’s own revenue generating content that takes prime position in the search results.
The issue is, of course, is this fair on the other advertisers, is it fair on the businesses who rank top but get moved behind Google’s own advertising, and is it fair on the consumer?

Are you looking for a flight? Don’t use the other flight comparison sites, use Google’s own sponsored engine, which could well be generating affiliate revenue for Google.

Here’s a quick search for flights from Birmingham to Paris.
There are 3 types of content:

1. Pay Per Click ads that are cost broker advertisers like Cheapflights, Lastminute and Expedia, as well as carriers like Air France
2. Google’s own sponsored search engine, which generates revenue
3. And then finally, the organic result which starts with the flight comparison site Skyscanner

 
Tucked away in the top right-hand corner of the google.com/flights is the Sponsored notice indicating that the results are from providers who may be compensating Google for inclusion:

Want to buy a Google Pixel phone? Forget the likes of Carphone Warehouse, Vodafone or O2. Google’s own adverts send you straight to Google Store.

It might not be surprising to see Google paying to have its own ads appear when searching for the Google Ads brand

… as well as seeing the advertising platform Microsoft Bing also bidding for the “Google Ads” phrase with its advertisement appearing immediately below Google’s.

And Google advertises on its network for its other branded offerings

Google’s wide range of service offerings provides plenty of advertising opportunities, including the Google Pay payment gateway.
Indeed, if you do a search on any of the Google services (Google Play, Google Docs, Google Drive and the like) you will almost certainly trigger an ad.
What is interesting, however, is that at the moment a search for the Google-owned operating system Android does not trigger an advertisement.

Google has experimented in this space before

When I originally wrote on this topic back in 2005, Google was much more active in this grey area.
Services like Google Advisor, also known as Google Compare (shut down in 2016). This was an affiliate model search engine, meaning, in short, Google allowed advertisers to promote credit cards, auto insurance, mortgages and travel insurance products and services on a cost per lead model. This service didn’t generate the success Google was hoping for.
Back in 2005 Google was also advertising its own spam software, formerly known as Google AntiSpam and now called Google Recaptcha.

So does this Google advertising really matter?

What could the impact of Google’s advertising strategy be on the market?  Does Google really welcome competition and provide users with more choice?
I think these advertising techniques could play havoc with the advertising model.
Display advertising prices could increase. If Google wants to occupy one of the top 3 positions, or  that very sweet spot at the top right, then inevitably the prices will go up for competitors.  If prices are set by competitive auction, then Google’s own participation will skew the market-driven pricing.
Consumer choice will be reduced.  All the evidence points to the fact the searchers don’t even scroll to the bottom of the first page of search results.  With Google sitting pretty above the fold in prime position, the choice offered to searchers is reduced.
Does AdWords really “help other businesses to compete”?  Not if Google is one of the competitors.  Think of the impact on smaller businesses when faced with Google’s own comparison ads.