Click Farms. Impression Fraud. Zombie Networks. P-P-C. Cost-per-Action. Sploggers.

Originally published March 13 2006Never heard of Click Farms Zombie Networks or Splogs You39re not alone but you will hear more about them as the Click Fraud debate that has been looming for the past few years emerges as the hottest topic in the online communityLast week Google agreed to settle a classaction lawsuit brought against it by one Lane39s Gift ampamp Collectibles If approved the settlement will provide a kitty of not more than 90M towards advertisers who believe they paid for fraudulently created clicks as far back as 2002 Each of the leading search engines ubiquitous Google Yahoo and Microsoft have been reaping billions from advertisers for search engine leads Now it seems some of it may have been based on fraudulent actions by Click Farms Zombie Networks and SploggersTo a great extent the media is inaccurately reporting the story the consequence of business reporters not understanding the search advertising model that is the online standard today In no way has Google admitted to quotknowingly overchargingquot advertisers Rather it appears that until now it has not owned up to the potential severity of the issueAt bit of context Currently the online search model operates under a Pay Per Click PPC model first developed by IdeaLab chairman Bill Gross The acronym is selfexplanatory when a user clicks on an ad that appears beside your search results Google charges affiliates who have paid for placement via its AdWords program Based on popularity there is an auction for the cost of the word Therein lies the potential for manipulationIn the January issue of Wired magazine Charles C Mann explains how simply by clicking on a rival39s ad you can exhaust their ad budget and force them off the page Recent investigations into this practice were conducted by the Times of India which found there were quotClick Farmsquot stocked with lowwage earners who manually clicked on advertisements around the clock According to the article fraud occurs when a person clicks on ads multiple times a competitor clicks on ads to waste competitors39 ad dollars website owners click on their own ads to increase revenues robot programs repeatedly visit the ad disguised as legitimate visitors businesses are set up exclusively to click on adsWired News reported that Auction Experts International a Google AdSense partner allegedly made 50000 by clicking on the ads it displayed on its own website Their counterparts are firms that participate in quotimpression fraudquot where you repeatedly click on web pages to generate false impressions or reload a search engine page and don39t click on a competitor39s ad Ultimately they are dropped for nonperformanceAs with all things technological humans have been replaced by software Last October Danish police discovered that three youths had forged a Zombie Network that was toggling 15 million personal computers together not to spam or unleash viruses but to target Google and perpetrate click fraudAnother way fraud has been committed is through spam blogs or splogs Splogs are blogs where the articles are fake and are only created for spamming The purpose according to Wikipedia quotis to increase the page rank of the affiliated sites get ad impressions from visitors andor use the blog as a link outlet to get new sites indexed Content is often nonsense or text stolen from other websites with an unusually high number of links to sites associated with the splog creator which are often disreputable or otherwise useless websitesquotHow frequently does click fraud occur Google maintains it39s 1 while The Wall Street Journal cited reports that more than 20 of all clicks are fraudulent Some industry observers argue click fraud in some cases runs from 30 to 40 on leading search engines and up to 80 on second and third tier search engines Last August MEC Labs published a research brief stating that the instance of click fraud in Google39s payperclick search engine might be as high as 295 percent quotFrom our research we found that it is unlikely an individual committing click fraud by clicking an ad over and over will go undetected by Googlequot said Flint McGlaughlin director of MEC Labs quotBut our research also shows that when more sophisticated systems and software are used only a small percentage of the fraud is detected with fraud increasing proportionate to the bid pricequot MEC LabsMarketingExperimentscom is conducting additional click fraud research Clickfacts also tracks click fraud across various types of sites content and advertising For more information contact Clickfacts CEO Michael Caruso at MichaelclickfactscomDavid Vise39s The Google Story suggested troubles ahead for Google in the bestseller39s discussion of click fraud While Yahoo copped to the problem and seemed to be responsive to customer complaints Google had a curiously cavalier attitude indicating that quotYes it was aware of the problemamp8230quot but that it was an internal matter something not to be discussed in the mediaGoogle has had an exciting but tumultuous first quarter in 2006 It began with a bang by announcing its 1B investment in AOL and then Google purchased dMarc also in a 1B deal that announced its foray into radio advertisingWhile these moves were universally applauded Google39s move into China has stood the firm39s quotDo No Evilquot credo on its head even as the Department of Justice demands that it share search query results for its case on behalf of the Children39s Online Protection Act COPALast week39s settlement comes as Google is trading at 33750 down from its yearly high of 475 Piper Jaffrey39s ceiling of 600 looks quite bullish these days Clearly this was one week that Sergey Brin and Larry Page wish had never happenedWhat this case does point out is that Google and its peers have to come up with a different model Google relies on advertising for 99 of its revenues That said Google39s a bigger recipient of ad dollars than any television network or newspaper chain But search ads might be getting too expensive for their own good Both FTD and Blue Nile are reportedly backing way for this reasonBill Gross the aforementioned daddy of PayperClick has himself switched to a new advertising model costperaction CPA Advertisers only pay when you ultimately book that hotel room or buy the book Gross39s search engine launched in late 2004 and is called Snapcom once the name of the NBCowned search tool Until now search engines have spurned his alternative because it demands transparencyWhatever the result of this classaction lawsuit Yahoo is fighting it and a judge has yet to accept the settlement it does appear that Google is no longer in a state of denial about click fraud Danny Sullivan of SearchEngineWatchcom long a Google booster sees a silver lining in this episode quotThe settlement gives Google a fresh start They need to regain the advertiser39s trust and be more responsivequotBut not so fastA second classaction lawsuit was filed against Google last June by Click Defense a Web service devoted to tracking and preventing fraud While there are several legal issues represented in the suit the key seems to be the interpretation of whether quotactual clicksquot the contractual measure of value in Google39s agreements exclude fraudulent clicks and if it is Google39s responsibility to identify fraudulent clicks Whatever the legal issues and judgments expect large advertisers and agencies to demand improved audit procedures and click validation Also the two Texas law firms that filed the Lane39s Gifts ampamp Collectibles suit have created a site at wwwLostClickscom to aggregate other companies that believe they might have been quotvictimsquot of click fraud and the attorneys appear committed to pursuing additional class action suits

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Click Farms. Impression Fraud. Zombie Networks. P-P-C. Cost-per-Action. Sploggers.

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Click Farms. Impression Fraud. Zombie Networks. P-P-C. Cost-per-Action. Sploggers.

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