ADMISSION TEST FOR PROGRAMME 2008-10

Direction for Questions 88-99:
SECTION – C (PART – i)
Read the three passages carefully and answer the questions given at the end of each
passage:
Passage - 1
The trouble started on May 4, 2004, only days after Google's celebrated comingout
party. Geico, the giant automobile insurer, filed a lawsuit against the search engine
for trademark infringement. The insurer claimed that Google's advertising system
unlawfully profited from trademarks that Geico owned. Since all of Google's revenue
and growth was from advertising, the disclosure of the lawsuit appeared ominous. “We
are, and may be in the future, subject to intellectual property rights claims, which are
costly to defend, could require us to pay damages, and could limit our ability to use
certain technologies,” Google disclosed in a public filing outlining potential risks.
Abroad, where Google had promising growth prospects, similar court challenges also
arose. “A court in France held us liable for allowing advertisers to select certain
trademarked terms as keywords,” the company declared. “We have appealed this
decision. We were also subject to two lawsuits in Germany on similar matters.”
To make matters worse, it turned out that prior to its IPO filing, Google had eased
its trademark policy in the U.S., allowing companies to place ads even if they were
pegged to terms trademarked and owned by others. That was a significant shift, and one,
Google warned could increase the risk of lawsuits against the company. It was also a
practice that Yahoo, its search engine rival, did not permit. Google claimed it made the
policy change to serve users, but some financial analysts said it appeared designed to
pump profits before the IPO.
And there was more. Competition from Yahoo and Microsoft posed a greater
challenge to Google following the disclosure about its mammoth profitability. With so
much money at stake, the intensity of the competition would heat up. Such competition
might be good for computer users searching the Internet, but Google said it posed
additional risk for potential shareholders. “If Microsoft or Yahoo are successful in
providing similar or better Web search results compared to ours or leverage their
platforms to make their Web search services easier to access than ours, we could
experience a significant decline in user traffic,” the company disclosed. In addition,
Google warned that its momentum seemed unsustainable due to competition and “the
inevitable decline in growth rates as our revenues increase to a higher level.”
Then there was the question of Google's exclusive reliance on advertising, and
one particular type of advertising, for all of its revenue. That was potentially quite
problematic. If Yahoo or Microsoft gained ground on search, users could flock to their
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