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Google ends gambling ad self-denial

Greed trumps Sanctimony

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Yes, Google's self-denial goes only so far.

Four years after telling itself to ban gambling ads across its worldwide collection of websites, Mountain View has suddenly lifted these sanctimonious sanctions in the United Kingdom. The announcement arrived on the same day the ad broker announced that UK revenue growth had slowed during its latest fiscal quarter. In Q3, UK growth was just 17 per cent from a year ago - and essentially flat relative to Q2.

When we asked Google about its gambling change of heart, it didn't respond. But the company tells The FT it's been reviewing that four-year-old gambling ad policy "to ensure it is as consistent as possible with local business practices." According to James Cashmore - who describes himself as the company's industry leader, entertainment and media - Google hopes that lifting the UK ban "will enhance the search experience for users and help advertisers connect with interested consumers."

He did not mention that this would bring the company mountains of cash. According to search engine marketing agency Greenlight, UK gambling ads are worth as much as 100 million pounds a year to Eric Schmidt and crew.

"The bottom line really is it’s a lot of money....a lot of advertisers have had to half their budgets in the past year. [Google has] got to recover this money somewhere," Greenlight's Hannah Kimuiu told The Times, alluding to the effects of a melting economy.

During Google's Q3 earnings call, an analyst asked the company why it had changed its policy so suddenly - announced only yesterday, the reversal went live today - and Eric Schmidt tossed the question at senior vice president for global sales and business development Omid Kordestani. Kordestani is based on Mountain View but was dialing in from London.

Naturally, Kordestani rolled out the business speak. But he left little doubt Google made its decision with an eye on the bottom line. "To be honest with you, this is one of the benefits we have now of much higher attention to every aspect of our international operations," he said. "There are questions that the market had put on us and we really are being much more responsive to these things, through our sales organizations, and we changed this policy very quickly to address market demands."

In April of 2004, both Google and Yahoo! banned online casino ads, blaming a "lack of clarity" in US regulations. Yahoo!'s ban applied only to its US web properties, but Google opted for sanctimony and took the sanctions worldwide.

The US later outlawed online gambling, and last summer, Google UK extended the ban to include ads for non-cash games and gambling tutorials.

Yes, online gambling is perfectly legal in the UK. And in speaking to The Times, Google said it reversed the ban to get in line. "At the time, we thought banning these adverts worldwide was the responsible thing to do and would give us a chance to review our policies," the company explained. "But we like to localise our policies to make sure they’re relevant to cultural and legal practices in a particular country."

Of course, where online gambling is concerned, UK cultural and legal practices are no different than they were four years ago. It appears that Google is most interested in localising policies when the locals aren't providing enough dough.

So, more of the same from Google. The company enjoys painting itself as operation with a higher calling. But in the end, it just wants your money. ®

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