How is Google Policing Click Fraud? - A Billion Dollar Crack Habit
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Google has a point in claiming that Outsell's figures are supported by vested interests who would like click fraud numbers to be high in order to promote their own businesses (ad agencies, fraud detection software and fraud detection services). Google also has a point in claiming that the press have helped in spreading Outsell's story -- then again, it talks about lots of money and big companies, so why wouldn't the press spread it? However the same argument can be used, and to much better effect against Google and the figures Shuman Ghosemajumdar claims to be quoting. Not only are they internal figures, but they work better still as an excellent PR tool.
Google's sixty something percent grip on pay per click revenue is worth $2.7 billion per quarter as of the third quarter of 2006. That is a very large figure to see being whittled away by bad "cyberbuzz." Google would not like to see their PPC model being replaced by a CPA model, and neither would web site owners (really, AdSense is good business). Some webmasters claim that when they checked the loopholes in AdSense, they couldn't publish their findings due to the thought of what would happen if their data was acted on and the PPC model was changed to CPA. The losses they would experience would make life slightly less interesting.
Blowtorch (www.blowtorch.com) is one site that is aggressively marketing itself based simply on its anti-click fraud stance. It is a meta search engine that offers its advertisers a money-back guarantee on driving legitimate traffic to their sites. The senior vice president of marketing, Joe Halcomb, does go overboard with the issue of click fraud, however, claiming figures as high as 33 percent. Blowtorch is hoping advertisers will abandon other search engines and turn to it for their needs. How they will do this with increased incidences of suspected click fraud is unknown, as analysts who comment on the recent "botnet" phenomenon (bot networks which perpetrate click fraud) observe that it is almost impossible to distinguish between a human click and a "bot."
Nobody really knows how high the figures for click fraud incidents really are, but for Google to be discovering up to 9 percent shows that vigilance is essential, and that perhaps other models will be more effective for advertisers.
Alternative Models
Bill Gross (who brought us Overture and the pay per click system) has introduced a CPA model with www.snap.com. Google is likewise exploring possibilities on www.turn.com. Losing PPC to CPA, however, will reduce earnings substantially, since actions depend a lot on the web site's landing page and content. It is in Google's interest to tout the current PPC model as the best way for advertisers to go.
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