by July 3, 2002 0 comments

When searching through a keyword in a search engine, apart from a list of websites, you also come across ads and websites of competitors of the manufacturer you were searching for. This is because search engines and directories sell word-specific banner advertising. The company that owns or is licensed by the search engine you were using would’ve sold that keyword. And every time a user of that search engine enters that word or combination, that manufacturer’s ads will automatically be displayed. In some instances, keywords are even embedded into websites and the owners of those websites pay to have their sites listed first in the ranking of located websites. 

Search-engine operators make money by selling this type of advertising and advertisers are willing to pay for desirable locations. This type of advertising is sold either per click or per impression. Per-click advertising works on the premise that advertisers pay each time someone clicks on the ad that they have placed and the consumer is taken from the search-engine site to their home site. Thisis more expensive since few Web surfers rarely click on banner ads. When an advertiser pays per impression, hepays the search engine for each Web surfer that actually sees the banner ad. This is calculated on a cost per thousand impressions. 20 to 30 percent ad revenues are generated from keyword banner ads.

Take for example the trademark NIKE. Although it has meaning in Greek mythology as the Greek goddess of Victory, it has become synonymous with the sporting-goods company. When faced with the word NIKE most people speaking most languages will associate it with sporting goods. So, if one of NIKE’s competitors embedded this word into a list of keywords, every time this word were entered into a search engine the competitor’s goods or website would appear. This would be a misuse of the NIKE mark for which a great amount of money has been spent in establishing the goodwill associated with it.

This raises many issues:

  • A company’s trademark can be used without authorization by search engines and directories in advertising sales practices

  • Will visitors of websites be sophisticated enough to realise that they are being led by ads which are directly linked to the words that they are searching and are they able to differentiate between ‘use’ as defined in relation to trademarks or are being misled by savvy advertisers. Even if the chance of confusion is small, does that render the confusion acceptable practice?

  • Is the search-engine owner or the owner of the site who has purchased the keyword responsible for the alleged infringement? Or, should portal operators be required to ensure that no words, which are trademarks, are used in an unlawful manner?

  • How distinctive must a trademark be to have success in such a case of keyword use? Can only unique, coined words be proper subject matter for protection against use as ‘keywords’?

  • Are there any easy solutions?

Rodney D Ryder, Advocate, Supreme Court of India, is a consultant on 
trade and technology laws

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