This is an interesting Google story...

[domainacrobat]

I was surfing the web and this came to my attention. It is about Google and click fraud.

The Vanishing Click-Fraud Case

Pretty interesting.... I bet they dropped the case because they are going to hire him...LOL

 

[TestCase]

Nice read, Thanks!

 

[Spade]

I remember this story - Im suprised this happened. Perhaps he was offering to sell the program to them as oppose to blackmailing them? His attorney probably came up with a nice defense!

 

[accent]

Many industry estimates have put the click-fraud rate at 10% to 15% of all clicks.

From an advertiser's standpoint click fraud is irrelevant.

Here is why. Advertisers bid on the amount they will pay for each click.
They base their bid on the estimated profit they are making from their ad.
All advertisements are (assumedly) equally clicked by fraudsters.
Therefore click fraud is simply "noise" in the system and if it suddenly vanished bids per click would quickly rise in the open market to cover the difference.

 

[equity78]

It is not irrelevant to advertisers If I have a $5000 monthly budget for Adwords and $2000 is fraudulent clicks that is not irrelevant to me or any other advertiser

 

[WhiteWebServices]

All advertisements are (assumedly) equally clicked by fraudsters.

That depends on the type of fraud. Some fraud aims at generating revenue for publishers. Other fraud targets specific advertisers and exhausts their budget for worthless clicks.

 

[nRnF]

Fraud is fraud, doest matter which point of view you have.
I rely about 30% of my biz on PPC, and this is a significant cost factor.
PPC would be much more accesible (in financial terms) if there would be fraud.

Someone said between 10% and 15% is click fraud.
If it was that less, Google would disclosure their "top secret" stats to advertizers
Unfortunately real figures are higher......

PS:
I saw about 3 days a ago a PPC fraud script at Ebay, which was exactly advertized as such.

 

[cache]

1. that guy is stupid.
2. the guy still should be charged even if google does not want to release the secret.

 

[accent]

It is not irrelevant to advertisers If I have a $5000 monthly budget for Adwords and $2000 is fraudulent clicks that is not irrelevant to me or any other advertiser

You are not following my point.
If the $2000 fraudulent clicks in your account vanished then your competetion's fraudulent clicks would also vanish (unless it is them doing the clicking, as Akrasia says). Your competetion would also have additional money in their ad budget, would see the increase in their profit per click (fraud is gone) and would raise their bids per click to increase marginal profit, causing you to raise your bids as well. Everybody would end up pretty near exactly where they are now.

This is basic economics, although the logic is obscured by emotions.

 

[RogueWriter]

Since a percentage of any click fraud is certainly generated by one of your many competitors, their PPC is cheaper than yours, unless those fraudulent clicks are eliminated, which lowers your overall cost, freeing up money to purchase time based ads on content sites, or some other advertising venue.

I've solved this problem, though, in that I do not even advertise anymore, and haven't for several months. Get enough pages into the search engines, and the traffic is there, anyways, for free.

 

[omnia]

Interesting read. Would be nice to know the reasons for the case being dropped.

 

[estibot.com]

But isn't extortion a case for the public prosecution? I mean, how can the fact that Google will not press charges cause the case to be dropped altogether...? Any lawyers here? Does it gave to be Google vs fraudster, can it not be California vs fraudster or U.S. vs fraudster or whatever?

 

[petrosc]

But isn't extortion a case for the public prosecution? I mean, how can the fact that Google will not press charges cause the case to be dropped altogether...? Any lawyers here? Does it gave to be Google vs fraudster, can it not be California vs fraudster or U.S. vs fraudster or whatever?

In order to be able to convict him, they need the cooperation of Google, if they don't cooperate, there's not much they can do, is there?....

 

[domainacrobat]

Ultimately I bet they worked out a deal - You dont release the program, we won't prosecute. Why would they do this? To avoid exposing their closely gaurded "secret sauce algorithims" in a court case. For Google, the more the government knows about their business, the worse it is. In order for google to prove his programs destructive capability in court they may have to expose secrets. It would just be easier to entrap him, then hold his freedom over his head...