Google bans porn from its ad network

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Google is getting out of the porn advertising business.

The changes, which went into effect late Monday, prohibit any promotion of most sexually themed sites, specifically those that feature "graphic sexual acts with intent to arouse including sex acts such as masturbation."

A company spokesperson noted that Google has long had restrictive policies on its adult category for some time and expected many advertisers had already looked to other advertising venues.

Industry insiders, though, tell a different story.

"I was caught by surprise," says Theo Sapoutzis, chairman and CEO of AVN Media Network. "I was one of the very first advertisers for AdWords back in 2002. It's something that's been [untouched] for 12 years, so you don't expect change is going to start happening."

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Notification of the policy change came in an email, sent to companies that were positioned to be in violation of the new policy earlier in June, which read:

Beginning in the coming weeks, we'll no longer accept ads that promote graphic depictions of sexual acts including, but not limited to, hardcore pornography; graphic sexual acts including sex acts such as masturbation; genital, anal, and oral sexual activity.

When we make this change, Google will disapprove all ads and sites that are identified as being in violation of our revised policy. Our system identified your account as potentially affected by this policy change. We ask that you make any necessary changes to your ads and sites to comply so that your campaigns can continue to run.

Adult industry insiders say the impact of Google's decision won't be clear for some time. While many companies use AdWords, word of many adult sites—ranging from streaming video "Tube" sites to webcam models to entertainer's personal pages—spread through word of mouth and by natural search results. (Related: Top Adult Entertainers)

"There are many people who say the biggest losers are the ones who play by the rules," says Tom Hymes, senior editor at industry trade publication AVN. "The winners are the huge properties with a lot of free content and frequent updates—the type of actions the Google algorithms really like. But at the end of the day, there are some people out there who have been abiding by every [rule] that Google sets and they're getting cut off at the knees now."

"Porn" is one of the most common searches on Google, in fact. In the month of May, searches for the words sex, porn, free porn and porno fell just short of 351 million, according to Google AdWords Keyword Planner.

Some people, though, wonder if changes to the AdWords policy could foreshadow bigger changes to how the company handles the porn industry.

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"This is another example of a mainstream company turning its back on the industry that has supported it," says Michael Fattorosi, an attorney with Fattorosi & Associates, a boutique firm that represents the adult industry. "The question now becomes: Will they block adult content from their search results?"

A Google spokesperson did not respond to a request for comment on that speculation.

Porn companies and porn performers have seen several industries curtail their ties with porn performers and companies lately. In April, Chase Bank closed the accounts of hundreds of people who work in the industry. In May, Amazon began deleting the wish lists of several adult stars. And PayPal recently has closed the accounts of porn actresses.

Beyond this, the porn industry has also been fighting a bill that would make condoms mandatory in any adult productions shot in California. (The bill cleared the Senate Labor & Industrial Relations Committee last week and now moves on to Senate Appropriations Committee.)

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Anti-porn activists Morality in Media are taking credit for Google's AdWords policy change, saying the modifications were the result of a meeting the group had with Google in May.

Google, however, first gave notice that it would be changing its policies in March, saying on its advertising policy change log: "We made this decision as an effort to continually improve users' experiences with AdWords."

--By Chris Morris, special to CNBC.com.

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