In the latest development in a long-running dispute between Google (NSDQ: GOOG) and the UK ad industry, the search giant has agreed to contribute seed capital to expand the policing of the online economy. The Advertising Standards Board of Finance (Asbof) said on Tuesday the CAP code, enforced by the Advertising Standards Authority, will be expanded to include “marketing on websites”, which could mean areas such as text and search ads which are outside the ASA’s mandate.
It amounts to an agreement between the world’s biggest search player and the UK ad biz that the existing loopholes in a largely unregulated system must be closed. As Guardian.co.uk points out, this signals at least a hiatus in the heated discussions between Google and the UK ad industry on who would manage the new effort and how much funding Google would contribute.
Currently, the ASA regulates “advertisements in non-broadcast electronic media, including online advertisements in paid-for space (eg banner and pop-up advertisements)” — but display and pop-ups only cover a fraction of modern advertising techniques. As we found back in May, there is essentially no regulation for fast-growing areas such as affiliate ads and online advertorial content. The ASA told us then it was “fully aware of the potential regulatory gap that exists for consumers as technology develops”.
The ASA does receive and adjudicate complaints on online ads: in 2008, according to its latest annual report (pdf), it resolved 3,500 online complaints in 2008, but 65 percent fell outside the ASA’s current remit. ASA chair Lord Smith — former Labour minister Chris Smith — says it’s “crucial that the ASA can deal with the already significant number of complaints about marketing on websites, which is not, currently, subject to the CAP Code.”
Details are sketchy and the full changes won’t be published or ratified before Asbof, the Advertising Association’s Digital Media Group and the Committee of Advertising Practice (CAP) can all agree exactly what they will be — probably in the second half of 2010; the ASA told us the details hadn’t been decided yet and said this was simply a green light to expand the ASA’s remit.

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