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Google Agrees to Pay $90mln on Click Fraud Lawsuit
Hitokiri writes "Google has agreed to pay up to $90 million to settle a class action lawsuit 'Lane's Gifts v. Google'. The settlement stems from a lawsuit filed by Lane's Gifts earlier this year in an Arkansas state court and is designed to settle all outstanding claims against Google for fraud committed using its pay-per-click ad system back to 2002Google has made a statement on their blog."
The January/2006 Wired had an article titled "How Click Fraud Could Swallow the Internet" that presented a case study of a charter-jet service victimized by this ... turns out it was their competition doing
it to use up their on-line marketing budget.
Google Girl basically stonewalled 'em.
Hey submitter and editors -- Google isn't PAYING anything. They are giving credits to buy more advertising.
Am I the only one who recognizes the difference between "getting paid $1" and "getting credit for $1 - at that company"?
Reasons why I'm concerned about Google's business:
Cue Google-fanatic flamewar.
Free Conference Call -- No Spam, High Quality
I wonder why internet advertising does not take a page from the radio advertising playbook. Daily, on the radio, I hear ads that say "Mention this ad and save an additional 12%!" This system allows the advertising folks to learn quickly whether their ad is reaching its audience. The customers come in and tell you so.
Is there any reason why internet ads do not do this?
Trying to use sarcasm in text-based forums does not work.
Honestly, RTFM poster. Google says it will give advertisers who believe they are victims of click fraud up to 90 mil in advertising credits.
-- Checking emails and kicking cheats `till the day I die.
Telltale Games: Bone, Sam and Max
Are the Adsense subscribers going to get screwed with this settlement? Imagine if Google gives out $90 million in credits, and displays those ads contextually via Adsense, but decides to pay the Adsense subscriber well below (or even 0) the normal rate for the ad. Who will know? It'll look like a PSA to the Adsense subscriber. He has no idea how much the placement of that ad on his/her website cost the advertizer. And Google gets to burn through $90 million without it costing anything for themselves.
BroadbandPig
This story is complete bullshit, It doesn't even begin to represent the truth. For those that didn't RTFA, let me paraphrase:
Google usually allows advertisers 60 days to claim invalid clicks and recieve a refund for those clicks. Google has made a deal wherein they will allow advertisers to make invalid click claims going all the way back to 2002, and offer advertising credits for all of these clicks. Google does not yet know how many invalid clicks will be reported, but under the terms of the agreement the maximum credit given will come to a total of no more than $90 million.
So in other words, this posting is either FUD or just bullshit, and Google isn't paying anything, but rather offering advertising credits.
Big ones, small ones, some as big as yer 'ead!
Give 'em a twist, a flick o' the wrist...
Since when have we been using mln to denote million?
What's wrong with calling 90 Megabucks $90M ?
Unless people are worried about conflicting with powers of two, but in any case that should be denoted: $90Mi, or 90 Mibibucks.
Or does mln denote "Millions of dollars worth of in-store advertising credit", which another poster has pointed out is what the plaintiff is receiving.
"Nine times out of ten, starting a fire is not the best way to solve the problem." - my wife
Click fraud runs about 40% when noobs manage a Google Adwords account. Much of that comes from Adsense via the Google content network, because it's a way for webmasters to line their pockets at the advertisers' expense. Competitor click fraud happens too.
The ways to control click fraud are:
1. Set low bids on the content network. Click fraudsters pick on the richest bids.
2. Exclude sites from the content network that show below average conversion rates.
3. Use your own tracking URLs to double check Google's conversion figures.
4. Don't show your ads in cheap offshore locales. Some sleezebags have set up click fraud offices in these places where people are paid to surf and click on your ads.
Discount your bids to account for the cost of click fraud. As long as you are happy with your net cost per conversion, click fraud is just a cost of doing business. Your bids are lower, Google earns less. If Google wants to earn more, they should the eliminate fraud.
This is great news, I have been tracking all of our Google Ad Click-Throughs for months now.
Personaly i have seen hundreds if not thousands of tracking erros
For example a user clicked on our Ad 10 times in less then 5 seconds, and then another user clicked on it 5 times in less then 1 second.
Thank the lord for timestamps !
- MOSKIE
here and here.
They answer your questions.
Google wants you to get good value for your money and are doing it in their usual excellent way.
Friends don't help friends install M$ junk.
Basically it's an economics problem that the brilliant people at Google have realized. They could win the suit, but only after spending WAY too much on lawyer fees. Of course both sides would agree to a settlement by the defendant (more money, less work for the lawyers on both sides). This is also an opportunity that can't be passed by a defendant who realizes that their case might not have enough to overcome the amount of money Google can throw at a legal defense (which they could, but again, it's an issue of economics). This problem is clear in Google's blog on the subject:
For the finance folks out there wondering how we'll account for this, we can say that the attorneys' fees (which will be determined by the judge) will be charged as an expense, most likely in the first quarter, once the amount is determined. The credits will be recorded as a reduction to revenue in periods in which they are redeemed.
Anyone who is acting like Google isn't paying enough doesn't understand either economics or the american legal system (notice I didn't say justice system). They may understand the difference between right and wrong (and I don't think Google is right), but they fail to understand "the way things work in the real world."
7h3$3 4r3n'7 7h3 Ðr01Ð$ ¥0 4r3 £00|{1n9 f0r. M0v3 4£0n9. --OB1
All this is costing Google are the legal fees.
http://outcampaign.org/
Am I the only who one who thinks 'mebibyte' sounds really, really stupid?
Hamsters are at least as feathery as penguins. HamLix
Title says "Pay X", description says, "Pay Up To X", will the actual article say "Pay some amount which may be X".
'But how is it fraud?'
The problem is that Google is charging advertisers for adverts which were not seen (by humans).
I can understand that the advertiser feels cheated if Google charges advertisers for 1 million clicks on their adverts, but 999,000 of them were faked by a script and only 1000 times a human end-user clicked the advert.
The problem gets worse when companies are deliberately faking clicks to create huge advertising bills for their competitors, even though their adverts are not being viewed. Similarly angry customers could do this to 'get their own back' on a company that they feel has cheated them.
Google has a problem here and they need to fix it or people won't want to risk using their service to place adverts.
I'll probably be modded down for this...
Okay that's RUBBISH. The strength of the economy is nothing to do with how much money is out there, but how much it's moving around.
Cash is an abstraction of value. It's value comes from the fact that it's mutually recognised as having a value. That's where it's value comes from, a common-agreement. You find *anything* that people are just as willing to exchange for services/resources as money. Gold's "worthless" unless you can find someone who's willing to exchange it for something you want (eg, sex). A pig's useless if you're living with vegie hippies (not that they have money anyway).
Money means not having to look long and hard for someone who's willing to trade with you. This means you have time for other things. Money is an abstract representation of time ("time is money" is true). There is no way, by the furthest stretch of imagination, that you can say time is worthless. It's the most valuable thing you've got.
The revolution will not be televised... but it will have a page on Wikipedia
Overture claims to provide "Click Protection" for their pay-per-click advertising service. In reality they fail to prevent the most basic and easiest to detect non-authentic clicks - that is competitors clicking on competitors. They do not even filter out a customer clicking on their own links from within the Overture manager. Nor do they provide a method for an advertiser to test their own ad rendered URL's - a necessary function as a means to test the validity of an entered URL. Since filtering out such clicks would be simple and straight forward using established cookies or session id's - I can only speculate the reasons for not patching this obvious flaw and question the "sophistication of Overtures "Click Protection".
Slashdot has a banner at the top?
Man, i didn't know people still had to put up with that crap. I just assumed once AdBlock became so prevalent they just got rid of it.
Anyways, if you dont know what adblock is, you dont belong on slashdot. However, if you can't get Adblock to work like it should, you should check out http://www.pierceive.com/.
It will cover all of your adblock list needs. It even has an autoupdater, so you can stay up to date, even if your forgetful like me.
What did people do before firefox?
Clicking with the only intention being costing the advertiser money is what you'd call illegal clicks. For example:
"I get paid x per click of this ad, so I'm going to click it lots to get money from the advertiser"
or
"My competitor pays x per click of this ad, so I'm gonna click it lots to eat away at their marketting budget"
or even
"I'm going to cost [google] this customer, by clicking on this advert lots, but never buying anything. The advertising company will see their [google] clicks aren't translating to sales, and will stop advertising there".
The revolution will not be televised... but it will have a page on Wikipedia
"Many businesses are still in a 'honeymoon' with Google and aren't yet seriously computing the performance of their clicks (how many clicks turn into sales)."
I'll try not to be Mr. Obvious here, but consider this: when companies buy time on TV, they have no idea how effective those ads are. What I mean is, they can see the ratings for the TV show and you can guess how many people saw those ads based on the ratings, but that is no guarantee anybody actually watched the commercial, and even if they did, you have no idea if people associate your product with that commercial, and even if you did, you have no idea how that translates into a sale.
But yet despite all those handicaps, companies still purchase TV, radio, and print ads.
For online advertising, google ads or anything like that... at least you can measure some sort of direct impact... the month before, I had X hits, this month I had Y clicks The month before I had $X in sales, this month I had $Y in sales. In both case, I can measure those numbers well enough to draw a conclusion pretty quickly about the effectiveness of the ad.
The comparison is not different than direct mail, email, or other ads... does my revenue increase more than the cost of the advertising. If it does, then it's good for me. If it doesn't, it's not good for me, stop advertising.
If you don't know the impact in 3 months, then shame on you for not paying attention. And that's really my point. Google has been around long enough for companies to draw a conclusion as to the effectiveness of those ads. Either they're effective, or companies are not willing to admit that Google isn't effective.
You were mistaken. Which is odd, since memory shouldn't be a problem for you
Blocking every bit of advertising is not good for the net. Let say someone tomorrow came out with an addblock tomorrow that out of the box (thus no config from dumb users needed) blocked 95% of ad's on the net. What would result be? Majority of sites either closeing down or having to move majority of their content to premium pay to access areas. To host and maintain a website costs time and money, popular sites even more so, cut off or lessen their revenue sources (and the spread of ad blockers is turning a lot of advertisers off the net) and they have to find new ones. Taking this into consideration i only block ad's when they are: Pop up's Bandwidth intensive flash animations Obstructive/in the way of the content (hate how some sites make the content one narrow column of text broken every two paragraphs with ad's) Or if the site is overloaded with them (more than banner at top/bottom and maybe small side panel) And if a site is really good and i visit a lot i make sure every now and then to click the odd ad if it has remote interest to me.
n mln = (10^-3) * ln(n). It's short for 'milli-log-natural'.
Real Daleks don't climb stairs - they level the building.
I was in the adsense program for over two years and all of a sudden I get a message from Google saying our adsense account had received invalid clicks and was closed. What really pissed me off was that my wife and I had just started working on two new sites that were a part of a high traffic network. As such our adsense clicks went up a great deal with in a month and shortly after this they canceled our account. I know that I'm not the only one this has happened to. I personally know several people that have had there accounts closed by Google saying they have received invalid clicks. There's no way to appeal.
We have a e-commerce site and got hit pretty bad from competition on click fraud. So we set up tracking on all paid advertising links. We also set it up so that if an IP came in on the same PPC ad more than 6 times in a week, they would get a landing page describing click fraud. We found that a lot of actual customers were tripping this. In the process of shopping around, they couldnt remember our URL or company name, but they could remember what they searched for to get to our site. They would click on that ad 10 times in some cases while doing comparisons to other sites. Its not click fraud, but its still pretty expensive to get that one customer.