French regulators slam Google Adwords advertising tool

IDG News Service - Google must restore the Adwords account of Navx within five days and allow the company to place ads again, the French competition authority ruled Wednesday, finding that Google had discriminated against Navx. It also gave Google four months to clarify certain aspects of its Adwords policies, which it said lacked transparency and objectivity.

French database publisher Navx suddenly found its Adwords account suspended in mid-November 2009 and had to wait four days for a written explanation from Google, the authority said in its judgment.

Google said it suspended the account on the grounds that its code of practice for advertisers tells them: "Don't promote illegal traffic devices that evade traffic laws," according to documents reviewed by the competition authority. In many European countries, radar detectors that warn drivers as they approach a speed trap are illegal.

Navx, though, says it neither sells nor promotes such devices. Its product is a database of the locations of radar speed traps that can be loaded into GPS receivers, allowing the device to warn as the driver approaches them in the same way it might warn if the driver strayed off a programmed route.

The company said Google frequently refused its ads, but that it was usually able to get Google to reactivate them by contacting its account manager.

Navx spent about 85% of its promotional budget on Google Adwords, and relied on the ads to bring in around two-thirds of its revenue, according to the judgment. That revenue dried up abruptly in the weeks following the November suspension, the authority noted.

However, another company promoting a similar product through Adwords was able to continue advertising until the following February, the authority noted.

In its discussions with Google, the competition authority said, the company protested that a decision should not have the effect of exempting Navx from the Adwords policy on radar detectors.

That is not the case with Wednesday's ruling, the authority said, because the Adwords policy did not clearly prohibit the product promoted by Navx. If Google wants to ban ads for such products, it is free to do so, as long as it makes this clear in its policy, and applies that policy consistently to all advertisers, the authority said.

The competition authority gave Google four months to clarify its policy on advertising devices for evading traffic laws, including what devices it allows, and what keywords or text advertisers may use to advertise such devices. By the same deadline, it must also explain its procedure for suspending advertisers accounts, describing clearly the last warning it will send before suspension.

Google may still appeal the ruling.

Peter Sayer covers open source software, European intellectual property legislation and general technology breaking news for IDG News Service. Send comments and news tips to Peter at peter_sayer@idg.com.