PPC bidding on brand names

There are some really short sighted affiliates out there who shouldn't be allowed near a ppc search engine in my opinion. Case in point, there is currently a very popular merchant online who allows brand name bidding with no restrictions. Now lets say their top bid on Overture is 20p, I always bid 20p or 19p so that I can get in position 2 and don't knock the merchant off the number 1 spot. However, each day this certain affiliate comes in and bids over the merchant to get the top spot. The merchant then bids over the affiliate to reclaim the top spot and so it goes on. The bids have gone from 20p to around 80p now.

Now is this affiliate stupid? Don't they realise by permanently bidding above the merchant and forcing them to raise their bid they are going to royally pee the merchant off? Of course you know what will happen next, the merchant will stop all bidding and we'll all lose out. The sad thing is that I have seen this happen so many times before. The last time was when AOL had to stop affiliates bidding as they were consistently bidding above the brand. Why on earth would someone do that?

The only way to work with merchants on brand name ppc bids is to agree a policy beforehand. We can't go on with this cowboy attitude or else I can see a time when all brand name bidding is stopped by merchants. To be honest it's getting like that now.

What I'm listening to right now: John Legend - "Get Lifted"