Gawker: valleywag, click fraud

IAC's Citysearch faces class-action lawsuit over click fraud

Nicholas Carlson — Wed, 28 May 2008 13:00:00 EDT

Los Angeles-based law firm Kabateck Brown Kellner filed a class action suit against IAC property Citysearch, alleging the site charges pay-per-click advertisers for fraudulent clicks. The firm has won similar cases against Yahoo and Google. All the major search firms now belong to anti-click fraud coalitions and make lots of nice noises about the problem. Truth is, click fraud isn't much of one. As Google CEO Eric Schmidt explained during an unguarded moment a couple years ago, click fraud will never be that much of a problem because if fraudulent clicks devalue the worth of click for an advertiser, that advertiser can always pay less per click.

26 million publishers commit click fraud — get over it

Nicholas Carlson — Fri, 22 Feb 2008 16:20:08 EST

Fraudulent clicks accounted for 28.3 percent of all clicks on ad networks like Google's AdSense and the Yahoo Publisher Network during the fourth quarter of 2007. After some approximations, Freakonomics puts the number of publishers who are theoretically complicit in click fraud as high as 26 million. Which means advertisers need to get over it. Buy ads on a cost-per-action basis, where you only pay when clickers turn into buyers. Or do your own math and discount what you pay for a click accordingly — which is, in effect, what Google, Yahoo, and the like are already doing to publishers. Whining about the problem gives zero ROI. (Photo by Jason Upshaw)

Yahoo keeps ineffective "click fraud czar" in place, showing how little it cares

Nicholas Carlson — Thu, 14 Feb 2008 13:40:40 EST

In March 2007, Yahoo named Reggie Davis its vice president of marketplace quality. The headlines hailed him as Yahoo's new "click fraud czar." Tom Cuthbert, president of Click Forensics, a search-marketing researcher, told CNET the move signaled "Yahoo is taking a more honest approach" to fighting click fraud." So what does it say about Yahoo's "honest approach" now that a tipster tells us Davis got the pink slip?

That Cuthbert got the reasons for Davis's hire hilariously wrong, and that his rumored pink slip indicates Yahoo is, at last, treating the problem seriously. Booted from Yahoo's legal team, Davis only got the "meaningless job as VP for click fraud," our tipster tells us, as "a bogus saving-face job thanks to sucking up to Sue [Decker]." Update: Davis now says he's still in place at Yahoo, so the sucking up must have been truly effective.

Google, Yahoo and everyone else in the search industry will tell you they're fighting click fraud as much as they can. And they are. Mostly by giving advertisers a discount that far exceeds the number of possibly questionable clicks, for show.

The truth is, as Google CEO Eric Schmidt said in a moment of unguarded honesty a couple summers ago, if illegitimate clicks really do find their way into cost-per-click markets, advertisers will account for it in how much they value each click, and pay less for them. Making jobs like the one Reggie Davis ~~held until yesterday~~ still holds as redundant as everyone but Yahoo figured out long ago.

(Photo by My Hobo Soul)

Indian press discovers click fraud

Nicholas Carlson — Mon, 12 Nov 2007 12:01:49 EST

Indian tech magazine Digit ran a cover story this month exposing a critical flaw in Google's pay-per-click advertising model. That's right — click fraud! The report tells the story of an Indian security analyst named Manish Arora who wrote a script to "simulate human behavior" and game Google's click-fraud detection algorithms. The script didn't work.

When Arora wrote to Google to alert it to the supposed vulnerability, Google replied, "At this point, all we can verify is that our automated systems terminated your accounts, as a result of your trying to inflate the clicks."

But just because the story is old news, Arora's attempt was ineffective, and Google shut down Arora's account, you can't blame Digit for running the story all the same. Not after they worked up a sweet cover illustration of Google's logo with a bullet hole in it. Never mind that it was Digit's story that proved to have massive holes.

$90 million clickfraud suit: a new meaning of "immaterial"

ndouglas — Fri, 10 Mar 2006 13:17:57 EST

Google co-founder Sergey Brin agreeing with Eric Schmidt about the "immaterial" click fraud problem, on March 2 (Analyst Day):

We believe that's a small fraction... We think we're doing a good job on that.

On the Google Blog ("Press release? Nah, just blog it"):

Last February, Google was sued in Arkansas over what is commonly called click fraud....
Under the agreement with the plaintiffs...we will offer credits which can be used to purchase new advertising with Google....the total amount of credits, plus attorneys fees, will not exceed $90 million.

Ninety million bucks: a lot to you or me, immaterial to Google. It's just their funny way of telling all their mom-and-pop clients, "we care."

Google under fire on 'click fraud' details [FT on MSNBC]
Update: Lane s Gifts v. Google [Google Blog]

Source confirms: Google Wallet should end click fraud

ndouglas — Thu, 23 Feb 2006 10:33:42 EST

A reliable source confirms rumors of Google Wallet. As Wired Magazine put it, this payment system would sidestep click fraud, the major threat to Google's revenue.

Basically, when a customer clicks on a Google ad, Google could handle any payments they make at the advertiser's site. Google takes a cut of the purchase instead of money for the first click-through. Bang, no more click fraud.

Gotta hand it to them — if Google rolls the Wallet out in time, they could save their revenue stream, and Larry won't have to go crazy over his falling net worth.

Background: How Click Fraud Could Swallow the Internet [Wired, page 3]