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User distrust noticed for ads blending with online search results in India: CIRC Study

A study of Indian internet users, conducted by the CUTS
Institute for Regulation Competition (CIRC) has revealed that paid advertising
getting interspersed with natural search results is not quite what users want. The
study was conducted in the two metros of Delhi NCR and Mumbai, apart from
Jaipur, among 500 respondents, almost equitably divided among the three cities.

A study of Indian internet users, conducted by the CUTS
Institute for Regulation Competition (CIRC) has revealed that paid advertising
getting interspersed with natural search results is not quite what users want. The
study was conducted in the two metros of Delhi NCR and Mumbai, apart from
Jaipur, among 500 respondents, almost equitably divided among the three cities.

More than two-thirds of the respondents were active internet
users (access the internet more than seven times a week) and 100 per cent of
respondents use online search. 31 per cent of respondents were unaware that
search engines also promote their own content alongside other websites and
services. Almost half of them did not prefer search engines doing so. 64 per
cent of respondents were aware that search engines capture user data from their
searches, while 29 per cent felt it was wrong, and wanted to switch search engines
upon knowing this.

Almost one-third of the respondents clicked on the top ads,
which accrue revenues for the search engine. A negligible 1 per cent clicked on
the side ad bar on the search results page.

More than half of the respondents were unable to identify
the top ad bar correctly. A comparatively lower 36 per cent were unable to identify
the side ad bar on a search result page. Almost two-thirds of the respondents
in Jaipur were unable to spot the difference between natural search results and
paid results.

Nearly half the respondents stated they would never or
hardly ever click on search results that they knew were ads. More than
two-thirds of respondents felt that natural search results are more useful than
ads.

Less than 30 per cent of the respondents considered ads as
trustworthy as natural results. Over 40 per cent felt they should not appear
above natural results. While the preference of web browsers was almost equally
split among Microsoft Internet Explorer, Google Chrome and Mozilla Firefox, all
respondents preferred Google as their search engine. This highlights the level
of faith users have in Google’s brand and search technology.

Presenting the findings of the study, Dr Navneet Sharma,
Director, CUTS Institute of Regulation and Competition, said: “the unattended
issues emanating from the online markets, which affect consumers and SMEs
alike, required primary research. This survey is a product of this demand.”

AK Chauhan, Director-General of the Competition Commission
of India (CCI), said: “The effects of the market conducts in the online space
are yet to be understood on account of the complexities in the online
ecosystem. The determination of the relevant market, both product and
geographical, alongwith assessment of a dominant position, would require very
sophisticated analysis. The findings of the pioneering survey will provide
useful insights.”

Pradeep S Mehta, Secretary General of CUTS International
said: “The exponential growth in the online market space has thrown new and
complex regulatory challenges to the government in general and the CCI in
particular.”

Dr Marc Pinter-Krainer, Founder and CEO of OneNewsPage, shared
his experiences about the evolution and monetisation of search results over the
past 10 years. Corroborating the findings of the study, Dr Pinter-Krainer
said:  “Over the past 10 years, a
significant rift has formed between what consumers perceive about what they see
in search results and what is actually displayed to them. Particularly on
Google, relevant organic search results are being increasingly replaced by advertisements
and Google’s own services – often without the user realising it. There is an
urgent need for greater transparency.”

Anupam Khanna, Director-General (Policy) and
Chief Economist of Nasscom underlined the importance of networks in online markets.
“The purpose of regulation in a multi-sided market requires thorough
considerations on parameters such as market failures, consumer protection, tax
and fiscal reasons etc,” Khanna said.

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