Does Google favour its own Ads?

Google is accused today of favouring its own advertisers - WSJ:

Google, which is developing more content or specialized-search sites in hopes of boosting ad revenue, says that prominently displaying links to them is more useful to Web searchers than just displaying links to sites that rank highly in its search system. But the moves mean Google increasingly is at odds with websites that rely on the search engine for visitors.

Those companies say their links are being pushed lower on the results page to make room for the Google sites. Critics include executives at travel site TripAdvisor.com, health site WebMD.com and local-business reviews sites Yelp.com and Citysearch.com, among others.

"There is no denying that today Google is competing [with many websites] for the same Web traffic and the same advertising dollars," said Jay Herratti, chief executive of CityGrid Media, a unit of IAC/InterActiveCorp. that owns Citysearch and sister sites Urbanspoon.com and InsiderPages.com.

Google of course says this is all for the best in the best of all possible worlds:

When someone searches for a place on Google, we still provide the usual web results linking to great sites; we simply organize those results around places to make it much faster to find what you’re looking for. For example, earlier this year we introduced Place Search to help people make more informed decisions about where to go. Place pages organize results around a particular place to help users find great sources of photos, reviews and essential facts. This makes it much easier to see and compare places and find great sites with local information.

We’ve heard from users and businesses that Place pages are a great way to find local information and reach customers. We’ve also heard from webmasters that Place pages help them reach a broader audience when users click through to learn more.

Well, they would - but as Google gets bigger, however, and it stretches up and down the value chain, there will increasingly be these conflicts of interest. And just like there were over-enthusiastic staffers sniffing people's wifi while taking pictures of their houses, its not hard to imagine other groups tweaking algorithms here and there too - especially as we now know that the algorithms are not necessarily "pure maths". The temptation in the short term must be huge at an operating executive level, because in the long term the gulty party is well outtathere. The risk to Google is a few profitable tweaks now risks a massive crash of confidence in a few years, probably co-inciding with a rise of other major Ad engines.

The European Union is already looking at Google, concerns there include this issue as well as various privacy-reducing practices over the last few years. It's also been a while since the "Do No Evil" motto could be applied to Google, so we suspect this issue won't go away and will get worse.