Media Lifeline: Google and the ad market

The internet search giant has often had a turbulent relationship with advertisers.

December 2004: There's growing disquiet in the advertising community that Google isn't doing enough to combat click fraud - the rogue use of software to imitate the action of a real consumer clicking on an online ad, which tend to be remunerated on a charge-per-click basis. At last, in December, Google finally admits there's a problem, and undertakes to have a look at trying to do something about it.

December 2005: Google's chief executive, Eric Schmidt, announces that the company is to buy a 5 per cent stake in AOL, the Time Warner subsidiary, for $1 billion, and begins selling display advertising and search services across all AOL websites.

August 2006: MySpace, which had been bought by Rupert Murdoch's News Corp for $580 million in July 2005, enters into an advertising and search partnership with Google. It is estimated that the deal, subsequently extended to cover all Fox Interactive Media sites, will generate shared revenues of $900 million by 2010.

April 2007: Google reveals it is to pay $3.1 billion to buy the internet ad-serving company DoubleClick. There are fears this may give Google a virtual monopoly in display. Its business model on YouTube, bought for $1.76 billion in 2006, demands big growth in display revenues.

July 2007: But there are growing concerns about the way Google is managing the search market. Allegedly, advertisers have been finding ways to get to the head of the list in the supposedly unsponsored listings. There are worries about guerrilla activity, too, with advertisers using terms that have been trademarked by rivals to hijack the search process. Google promises to stamp it out, but agencies worry it isn't acting with sufficient urgency.

Fast forward ...

December 2007: Google announces a fundamental redesign of its home page - historically a clean and clutter-free environment. Now it is to feature all manner of banner sites and a showcase video box running the most popular YouTube selections, including commercials from current campaigns. But agencies threaten a boycott when they still fail to receive the reassurances they want on transparency within the search market.