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Johannesburg - A row is brewing between Google SA and a local marketing company, Entelligence Ltd, that counts senior South African bankers GT Ferreira and Jannie Mouton among its shareholders.
In essence, Google SA has withdrawn the use of its tools from Entelligence, a critical development for the South African firm which in June signed a contract with TDS Directory Operations to handle Yellow Pages' online marketing.
Ferreira is a former chairperson of FirstRand and Rand Merchant Bank and Mouton heads up listed financial services company PSG. The two have not yet become involved in the dispute on Entelligences' behalf.
The reason for Google SA's actions is that it now wants to offer similar services to Entelligence, and others in its market, whereas previously Google SA only provided the operating platform and allowed marketing agencies to manage the campaigns on behalf of clients.
As a result, Entelligence, which is a Cape-based online marketing and web developer, has laid a complaint with the Competition Commission.
Says Entelligence MD Sean Riley: "We don't mind Google coming in as a competitor, but when that same competitor was previously quite happy to grant you the platform and technology to service these accounts and suddenly elects to switch them off so that they can take the business from you, we feel that's a bit harsh."
His concern is that Google SA is cherry-picking key accounts in the South African market and is taking whatever steps are necessary to ensure that existing agencies cannot continue to use Google tools to market these companies.
'No relevance'
Google South Africa country manager Stafford Masie says contractual agreements between TDS and Entelligence have "no relevance". Google SA will terminate services that would allow Entelligence to carry out their contractual obligations, he says.
The agreement between Entelligence and TDS Directory Operations is to boost traffic to the Yellow Pages website via a number of channels including the use of Google AdWords.
Google AdWords is an online tool for marketers that allow adverts to be displayed on Google network sites that charge advertisers a certain amount every time that somebody clicks on the advert to reach the client site.
Google SA is aware of the relationship between the two companies and even provided credit agreements between Entelligence and itself to facilitate these transactions.
South African agencies such as Entelligence argue that they have spent a lot of time developing the Google brand in South Africa, in the absence of a Google presence in the country.
In correspondence between Masie and Riley, Masie says: "TDS/Yellowpages has been categorised as a direct sales operation (DSO) account and will now be managed by my Google SA sales team within company".
This has taken place despite TDS managing director, Thabo Seopa sending a letter to Masie asking Google to respect existing contractual agreements between TDS and Entelligence.
- Fin24