Google (Nasdaq: GOOG) is nixing its free product search model, opting instead to charge merchants and retailers to appear in Google product search listings.
Currently, retailers can provide information about their products and then add them to the search listings for free, where they are ranked by popularity and price. Under the new model, dubbed "Google Shopping," retailers will be required to pay in order to appear in search results.
Rankings will then be determined by merchant bid price in addition to relevance. The products will appear in Google Shopping boxes, which will feature the paid search results in "sponsored" boxes above the regular search results.
Google Shopping is currently in an experimental phase and will be complete this fall. The search company hopes that maintaining a commercial relationship with retailers will help them keep their product listings up to date. Fresh and accurate search results will lead to a better online shopping experience for consumers and consequently more revenue for merchants, wrote Sameer Samat, vice president of product management for Google Shopping, in a blog post Thursday.
Google didn't respond to our request for additional comment.
Boosting Profits
In addition to creating what Google says will be a better experience for both merchants and shoppers, the new model could also boost Google's profit 
margin.
"Based on our clients' results, we would expect Google Shopping to increase Google's paid click total in the neighborhood of 2 to 5 percent over the long term. That's not a huge percentage, but it would ultimately mean billions more in revenue for Google," Mark Ballard, senior research analyst at Rimm-Kaufman Group, told the E-Commerce Times.
Profit is likely to come without many complaints from retailers, Ballard said.
"The reaction from our retail clients has been more positive than I expected," he said. "While no one is happy about having to pay for traffic that we were previously getting for free, a number of retailers have expressed optimism that the change will help fight price erosion and eliminate low-quality merchants who turn customers off from the entire comparison shopping channel."
The updated business model could even help merchants' bottom lines in addition to Google's, Rob Abdul, an e-commerce consultant, told the E-Commerce Times.
"I'm sure to offsetting the cost of a paid placement with a larger number of click-throughs will balance out the books," he said.
The retailers this move might hurt are the smaller ones, Ron Rule, vice president of e-commerce for Infusion Brands, told the E-Commerce Times. While larger retailers such as Amazon (Nasdaq: AMZN), Target and Walmart (NYSE: WMT) can already offer competitive pricing and have the budget to boost advertising and search placement, smaller brands that might have lucked out with free Google product search offers could struggle under the new model, he said.
That may not necessarily be bad news for consumers.
"It's the smaller websites, primarily those who carry no inventory and sell through drop-shippers, that will be hurt by the change," he said. "But that's not necessarily a bad thing for buyers -- as it stands, Google shopping is fairly easy to manipulate, and I've often searched for a product and landed on an 'out of stock, consider these instead' page. I suspect a lot of those never even had the product for sale and were simply looking to capitalize on searches for a major brand's name so they could offer a lower-priced alternative."
Keeping It Fair
Google has already faced criticism for its general search rankings, and having retailers pay for a spot in Shopping might raise more eyebrows among regulators, said Ballard. However, the distinction between Google Shopping products and other search results should help Google's side if a legal argument should arise.
"It seems that the federal authorities themselves aren't sure how search engines like Google should be regulated, but one key concern is that paid results be distinguished from the organic or algorithmic results," said Ballard. "This change will probably raise another round of questions about Google, but as long as they clearly label Google Shopping results as sponsored links, as they intend to, I believe they will be in the clear."
Google could also likely argue that under the new model, anyone has the chance to compete, said Abdul.
"I believe this is Google trying to even out the playing field between small and larger online retailers to compete fairly," said Abdul.
UPDATE 3-Investment needed in power-hungry Texas market-study - Reuters UK
* Report calls for re-evaluation of needed reserve margin
* Advises progressive price cap increases when supply tight
* Sierra Club criticizes push for higher wholesale prices (Adds Brattle Group, NRG Energy, Panda comment)
HOUSTON, June 1 (Reuters) - The current design of the wholesale power market in Texas will not encourage needed investment in new power plants, the Brattle Group said in a report commissioned by the state electric grid operator.
Texas electric regulators and the grid agency that oversees the $34 billion deregulated wholesale market are working to encourage construction of new generation in the state, which has little ability to import power from its neighbors.
Unlike many areas of the United States, electric demand in Texas continues to grow because of the state's healthy economy.
"Electric reliability matters to all of us and we must remain focused on the central question of whether we are doing enough to guarantee an adequate power supply," said Craven Crowell, chairman of the Electric Reliability Council of Texas.
ERCOT, which oversees the grid for most of the state, has warned that the prospect for rolling blackouts in future years will increase as the power supply is unable to keep pace with growing demand.
Low wholesale prices and tight financial markets have stalled development of new generation in Texas even as more stringent environmental rules threaten to shut older coal- and gas-fired plants over the next few years.
"The cold hard fact is that new power plants will not be built unless power prices support that build," said Bill Nordlund, managing director of Panda Power Funds. Panda has two natural gas-fired plants primed for construction in Texas.
Last summer's protracted heat wave, which triggered record electricity demand and six emergency declarations from ERCOT, intensified the need to address the state's shrinking power reserve margin, the cushion needed to avoid blackouts.
The report by the Brattle Group, a power industry consultant, did not recommend a specific course of action to modify ERCOT's "energy-only" market, which pays generators only when they produce power, but outlined five options along with advantages and disadvantages of each.
Brattle principal Sam Newell said the energy-only market has worked well to attract generation investment in Texas, but low wholesale prices now will not encourage as many new megawatts as regulators believe are necessary to meet a 13.75 percent reserve margin in the summer when electric use soars.
Newell said Texans should reexamine that reserve target given the fact that power line problems are the cause of many more outages than supply shortages.
"You can plan on a very high level of reserves and almost never, ever have to shed load, but that would be more expensive than maintaining a lower reserve margin," Newell said on a call with reporters. "There's got to be a balance somewhere. We think it's worth re-evaluating those standards."
If the commission decides the state requires a higher reserve margin than the energy-only margin will provide, Brattle offered several potential solutions.
Options included keeping the energy-only design, but adding a market-based reserve margin; higher prices to support a target reserve margin; or a back-stop procurement process to maintain minimum acceptable reliability.
Other options included a mandatory resource adequacy requirement for companies that supply power to customers, or having a resource-adequacy requirement with a centralized forward capacity market.
While the Texas Public Utility Commission has resisted calls to create a capacity market similar to those used in other U.S. power markets, the Brattle report addressed a number of criticisms that capacity markets simply boost overall costs that benefit existing generation owners without attracting new power plants.
The PUC and ERCOT have already implemented a number of market changes, including raising the price cap on wholesale power when supplies are scarce, to encourage construction of new power plants.
"The Brattle Group's report confirms that we are moving in the right direction," said Donna Nelson, PUC chairman.
Unlike what the commission has proposed, however, the Brattle Group advised ERCOT to gradually increase the wholesale price cap to $9,000 per megawatt-hour from $3,000 MWh, reaching $9,000 only in extreme scarcity when power to customers is being curtailed. These prices would be paid by the suppliers who serve homes and businesses.
"We like scarcity prices to progress over a range instead of jumping to the cap (because) with a smoother price curve, you have better market behavior and it will work better with demand response," Newell said.
The report warned that simply increasing price caps will not attract more generation.
"Many market participants that were supportive of the commission's actions so far were wary of the prospect of raising caps much higher," the report said.
The Sierra Club criticized the report for its limited look at energy efficiency and conservation options where customers are paid to reduce power use when supplies are strained.
"Instead of using our money to build more coal and gas plants, the PUC should implement their rules proposed to raise energy efficiency goals," said Cyrus Reed, conservation director of the Lone Star Chapter of the Sierra Club.
The Brattle report said expanded demand-response programs will be needed, but that over the long-term the state will have to see new power plants built.
Reed also called on the state to increase use of renewable power, such as solar. Texas is already the No. 1 state for wind generation.
The Brattle Group noted that growth of wind power in Texas has depressed wholesale prices to the point that generators cannot justify investment in new gas-fired power plants.
John Ragan, president of NRG Energy's Gulf Coast region, complemented regulators and ERCOT for seeking "expert, external analysis of the different options Texas can implement to encourage greater resource adequacy while maintaining a strong commitment to competition and regulatory certainty."
"I am confident that we can address the issues that we face," Ragan said. (Reporting by Eileen O'Grady in Houston; Editing by Lisa Von Ahn, Tim Dobbyn, David Gregorio and Bob Burgdorfer)
Window shopping becomes windows shopping - easier.com
The instant buzz of shopping online has reached a new high for clothes shopping, with 44% of Brits now hitting the net at least once a month or more for their clothing purchases, with a committed 3% doing this daily. This is second only to groceries (50%) in terms of the nation’s buying habits, according to new research from Cotton Council International, published today.
Clothes shopping online has risen to 13% - up from only 3% two years ago, with consumers moving away from chain and speciality stores (down from 43% to 31.5%). Today’s research reveals 42% of consumers now use the internet to compare products and prices across stores; a third (33%) go online to browse the latest styles.
Stephanie Thiers-Ratcliffe, International Marketing Manager, Cotton Council International comments: “Our research reveals that there has been a marked uplift for people going online to research and buy clothing, but not at the expense of quality. This trend has seen retailers across the board take more of an interest in their online clothing offering – ensuring the customer experience, delivered both on and offline, is second to none.”
This year’s findings also shows that when shopping, Brits are choosing natural fibres, with over a third feeling that better quality clothing comes from natural fibres. And when shopping it’s cotton that comes out in front as the fabric of choice, with over a half of consumers heralding it as their preferred fibre for the clothes they like to wear the most.
Mirroring the economic climate, only 10% of us bought more than £500 on clothes last year, with the average amount spent being only £230. Over half of Brits fear they have less money to spend on clothing compared to last year, making spotting a bargain more important than ever as 40% of us now admit we buy clothes with at least a 20% discount all or most of the time. We’re also shopping less for ourselves than two years ago, as the figures indicate a 9% drop, which leaves just 40% of us now shopping once a month or more for clothes.
Nonetheless, a prevailing trait for British shoppers remains the desire for quality – with almost 60% of us preferring to spend more on better quality items, with 61% of consumers viewing ‘good quality’ clothes as those that are durable and long-lasting.
Cotton Council International’s biennial research – The Global Lifestyle Monitor Survey (GLM) investigates a wide range of lifestyle issues related to clothing, shopping and textiles among UK residents.
Stephanie Thiers-Ratcliffe, continues: “Today’s shoppers are more vigilant than ever – thinking harder about their clothing purchases and examining what and how much they need to buy. When shoppers are spending their cash they are ensuring that they get the best value by choosing quality items. Our COTTON USA ‘Naturally’ Mark is a symbol of purity, strength, comfort and quality and helps shoppers to identify premium cotton items that are made to last.”
Gold Price Jump Wipes Out Week's Loss After Disappointing U.S. Nonfarms Report - marketoracle.co.uk
By: Ben_Traynor
WHOLESALE MARKET prices to Buy Gold jumped to $1589 per ounce on Friday, immediately after the release of worse-than-expected US nonfarm jobs data.
The US economy added 69,000 nonagricultural private sector jobs in May, according to official data published Friday, compared with analysts' forecasts for 150,000.
The US unemployment rate meantime ticked higher to 8.2% - up from 8.1% in April.
Gold's jump wiped out its losses for the week. By Friday afternoon in London, prices to Buy Gold looked set for a 0.6% gain on where they started the week.
Silver also spiked higher following the US jobs news, climbing to $28.14 per ounce – though this was still 1.4% down on the week.
"The larger trend [however] remains bearish," says technical analyst Russell Browne at bullion bank Scotia Mocatta.
A day earlier, gold's final London Fix of May 2012 was down 5.6% on April's last Fix – the third monthly fall in a row by Gold Fix prices. Spot Gold meantime – which back on February 29 fell by $100 an ounce after the PM Fix – ended May by making fourth straight monthly loss in Dollar terms.
By London Fix prices, gold has not fallen four months in a row since summer 1999.
In contrast with gold, European stock markets fell following the nonfarms release, extending their losses from Friday morning's trading.
Earlier in the day, German 10-year Bund yields fell to a fresh all-time low below 1.15%, while on the currency markets the Euro sank to its lowest level against the Dollar since June 2010.
Spain's banking system meantime saw €97 billion of capital leave the country in the first three months of 2012, according to figures published Thursday evening by the Spanish central bank. The Spanish government, which this week saw its implied 10-Year borrowing costs breach 6.7% for the first time since November, is trying to raise €19 billion to rescue nationalized lender Bankia.
The International Monetary Fund yesterday denied rumors that Spain's government has approached it for a bailout.
Over in Ireland, votes were being counted Friday following yesterday's referendum on whether or not to ratify the European Union's new fiscal treaty, which would impose limits of government borrowing.
"We are very, very confident [of a 'Yes' vote]," said Lucinda Creighton, Ireland's European affairs minister.
Press reports suggest around half of those eligible to vote in the referendum actually did so.
In Greece meantime, the biggest pro-bailout party New Democracy leads second place Syriza in the opinion polls, with just over a fortnight to go until the June 17 elections, news agency Bloomberg reports.
Syriza's leader Alexis Tsipras said Friday that the bailout agreement is a failure, reiterating that Syriza would reverse some of the Greek government reforms if elected, including privatizations and cuts to public sector wages.
"The [bailout] memorandum equals a return to the Drachma," Tsipras added.
The Eurozone's purchasing manager's index for manufacturing, a survey indicator of whether the sector is expanding or contracting, fell from 45.9 in April to 45.1 last month, figures published Friday show. A PMI above 50 indicates sector expansion.
Germany's PMI meantime fell to 45.2 in May – down from 46.2 a month earlier.
The Eurozone's unemployment rate meantime remained at 11.0%.
On the currency markets, the Euro fell to a two-year low against the Dollar Friday morning, remaining below $1.24.
European Central Bank president Mario Draghi warned Thursday that the current Eurozone structure is "unsustainable".
"At the moment, Europe and downside risks to the Euro are the problem for gold," says Michael Lewis, head of commodities research at Deutsche Bank.
"Dollar strength is going to be the big problem over the next few weeks."
The US Dollar Index, which measures the currency's strength against a basket of other currencies, hit its highest level since August 2010 this morning.
Here in the UK, manufacturing activity fell into contraction last month. May's manufacturing PMI was 45.9, compared to 50.2 in April. The consensus forecast among analysts ahead of Friday's PMI publication was for a figure just below 50.
The disappointing UK PMI figure "has increased dramatically the likelihood of the [Bank of England] announcing more quantitative easing next Thursday," reckons Deutsche Bank's chief UK economist George Buckley.
Manufacturing activity also slowed in China, the world's largest source of demand to Buy Gold in the first three months of 2012.
May's official PMI figure was 50.4, down from 53.3 in April. HSBC's PMI meantime, which looks at smaller Chinese firms, showed ongoing manufacturing contraction, falling to 48.4 from 48.7.
In India meantime, traditionally the world's biggest gold buying nation, gold demand for 2012 will fall by 4% by volume compared to last year – but will be 4% up in value terms – according to a report published by researchers at Morgan Stanley.
By Ben Traynor
BullionVault.com
Gold price chart, no delay | Buy gold online at live prices
Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK's longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.(c) BullionVault 2012
Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.
© 2005-2012 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.
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British shopping mall boss held over Qatar nursery inferno - The Sun
Tzoulios Tzouliou, 48, spent his fifth day under effective house arrest following Monday’s horror at the Villaggio Mall in capital Doha.
Flames swept through the complex trapping and killing all the toddlers in the Gympanzee Nursery.
Their four teachers and two firefighters also died.
The emergency workers were found clutching the bodies of children.
Mr Tzouliou — whose Greek Cypriot family were living in Winchmore Hill, North London — is being questioned about fire safety measures and evacuation plans in the mall.
Security guards were said to have told shoppers alerted by alarms it was safe to return inside as flames tore through the building.
Firefighters were also reported to have arrived half an hour after the alarms went off. They were not immediately told about the first floor nursery.
In all, five officials have been detained by police. The others include Iman al Kuwari, the Qatari owner of Gympanzee, and Rima Itani, Mr Tzouliou’s assistant manager.
The mall’s owner and head of security are also being quizzed.
Doha police said yesterday that Mr Tzouliou was not technically under arrest but was being “detained”. He is being held in a secure property, but not a jail.
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