You got it reversed. If you're Google and someone is paying you to put content on your website or give it some sort of preferential treatment within your already existing website, that is advertisement. It doesn't really matter whether some company paid for it or the company CEO had their nephew pay for it through aoney laundered network of obfuscation.
Hosting, or domains, does seem to be a loophole. Renting an entire website for your own product's advert is fine because that's "your website". What about subdomains? Or what about TLDs, suppose the operator of a TLD like .promo has a nice front page with a directory of all the sites, searchable, with short excerpts - all provided for free to the benefit of those who pay to own those sites. This could be like Facebook, or it could be like Neocities. I'm imagining a walled garden that treats its denizens equally, but they gain special attention from being there, and it costs money. Maybe that's OK.
