June 14, 2007

E-bay drops Google Ads

On Monday, Google announced it would throw a party in Boston on Thursday evening designed to attract eBay merchants who would be in town to attend the eBay Live annual seller conference.

The purpose of the party: protesting eBay's decision to forbid merchants in its marketplace from using Google's Checkout online transaction system.

So, Internet auctioneer eBay has pulled its U.S. search ads from Google, a stunning move by one of the search leader’s largest AdWords clients

eBay is one of the largest buyers of Google ads and a standard Google search for “iPod,” “shoes,” or “DVDs” normally pulls up paid links to eBay. But as of Wednesday, those links had vanished, though they did appear on rival Yahoo.

The spat between the two Internet giants is a sign that Google’s push into more industries—including online and offline advertising, media distribution, and web-based software—is creating all sorts of conflicts for the Mountain View, California-based company. Google was sued by Viacom over copyright of videos on YouTube, and AT&T and Microsoft have protested Google’s planned acquisition of online ad company DoubleClick.

eBay’s conflict with Google began last June when Google introduced its Checkout system. eBay has refused to allow Checkout to be used on eBay’s sites, saying that Checkout is still unproven.

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