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Google Pays out $90 million to settle Click Fraud Case

There’s news on Reuters today on a $90 million pay-out from Google over a click fraud case. While that kind of money isn’t massive in the scheme of things at Google it’s the precedent that is worrying. As the article says – some believe that click fraud is the ‘single greatest risk to Google’s advertising-dependent business model’.

This is the reason why Google have continued to crack down on those breaking their TOS over the last year – their business depends upon it.

Thanks to Aaress for the email tip.

update: More on the story at Search Engine Watch.

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Comments

  1. Yes, was redaing the news at yahoo as well.
    I knew it was coming.

    Google is now getting tight with all of its products including Blogger/blogspot.

    They have been checking for spams and frauds.

  2. Khurrum says:

    If someone suspects that there has been a click fraud for $1 then google will put in $1 into their adwords account.

    “The $90 million would involve legal fees and credits — rather than any cash payments — to all advertisers who apply to be part of the class settlement, once the judge certifies the agreement, Google spokesman Steve Langdon said.”

  3. Alex says:

    Interesting, this explains it. Google canceled my adsense account a few weeks ago with no explanation, other then that they detected click fraud. Yet I was making an average of 33 cents a day. So I was a bit stunned and really pissed off.

    Then I thought about it, I use Gmail. I’m sure once or twice, jokingly I told some friends how the ads worked or told them to click on them.

    When I sent a very upset email they stated that “they don’t reveal the review process” in any case, I feel a bit frustrated because I spent a lot of time understanding my ads. In any case I think this post explains their current extreme nature.

  4. Aaress says:

    Does anyone know if Google is using a type of filtering service similar to what Chitika uses to filter click fraud?

    For the past couple of days, I have been noticing no clickthroughs on my ads during the day, but yet when I click on the “yesterday” stats section of Adsense the following day, I see clickthroughs and revenue.

  5. marcel says:

    Maybe it’s time to use a CPM approach for “risky” publishers ?

  6. tom sherman says:

    Google’s “defenses” against click fraud are patently laughable. $90 mil? Whatever. Time for them to pay back $500 mil, or a billion, or $5 billion. It’s only a matter of time before the government — Google’s true enemy — steps in and says “Take your ‘secret’ review process and shove it.” The law will force the cat out of the bag. And I, for one, will welcome it.

  7. tom sherman says:

    p.s. from the Google Blog entry on this, it’s same old “just trust us on this one” CRAP. I don’t trust Google one bit. If you believe their “Don’t Be Evil” slogan, you’re hopelessly naive.

    We have said for some time that we believe we manage the problem of invalid clicks very well. We have a large team of expert engineers and analysts devoted to it. By far, most invalid clicks are caught by our automatic filters and discarded *before* they reach an advertiser’s bill. And for the clicks that are not caught in advance, advertisers can notify Google and ask for reimbursement. We investigate those clicks, and if we determine they were invalid, we reimburse advertisers for them. We will continue to do that, and believe that this settlement is further proof of our willingness to work together with advertisers to reimburse invalid clicks.

    Like I said, just trust ‘em. They’ve got super-secret methods that eliminate click fraud perfectly. That’s why they only had to pay out $90 mil.

  8. Google’s policy to terminate publishers withtout proof, evidence or recourse seems heavy-handed.

    Though I can understand their need to “protect” advertisers, there nees to be some balance here. Its like eBay saying: “we’re going to do everything possible to protect the buyers”. What about the sellers?

    One would think it would be more effective to improve their technical algorithms for detecting click-fraud (and removing incentive to publishers to use fraud to increase revenues) instead of seemingly arbritrary terminations of many, many publisher accounts on mere suspicion.

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