Companies that provide services for improving Web sites' search-engine rankings
and running effective search-engine ad campaigns have a new competitor: Google.

Bundled in the DoubleClick
acquisition came Performics, which provides search-engine marketing (SEM)
and search-engine optimization (SEO) services.

This has created concern for SEM and SEO service providers, which now face
Google, a key partner, also as a rival.

"It puts us in the awkward position of competing with Google's own [SEM/SEO]
agency for client accounts," said Lance Loveday, CEO of Closed
Loop Marketing, an SEO and SEM firm.

Over the past seven years, as Google's popularity with advertisers and end
users has boomed, so has the SEM and SEO business. Marketers began spending
significant amounts to advertise on search engines, primarily Google, and they
realized that they needed help from SEM firms to design, fine-tune and track
the effectiveness of those campaigns. At the same time, those marketers recognized
that they also had to make sure that their companies' Web sites ranked well
on search engines when users entered keywords relevant to their businesses,
which is what SEO service providers specialize in.

Before the DoubleClick acquisition, SEM and SEO firms saw themselves as providers
of complementary services to Google, but now that Performics is part of Google,
things have changed.

For starters, there is a concern that Performics will get special access to
inside information about Google's search-engine algorithms, allowing Performics
to provide SEO services that are more effective that its competitors'.

Then there is the worry that Google will push its in-house Performics SEM services
at highly discounted prices, or maybe even free, in direct competition with
SEM service providers.

Due to these and other clash points, SEM and SEO providers say their relationship
with Google will inevitably get strained. This will likely be bad for Google,
considering that SEM providers have a lot of influence over how their clients
allocate their search advertising budget.

But there are other reasons why holding on to Performics could be bad for Google,
and they have to do with perceived potential conflicts of interest that could
spook Google advertising clients.

For example, Performics is supposed to help its clients get the highest return
on investment (ROI) from their paid search campaigns by recommending they spend
what's necessary -- and not more -- in order to get their desired results. But
Google's business is to sell as much advertising as possible, said Scott Buresh,
CEO and owner of SEO/SEM firm Medium Blue.

Closed Loop's Loveday also foresees Performics clients worrying whether Performics
will now have an incentive to increase their spending on Google advertising
for the benefit of its parent company. "Now, the reality is that Google

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