Google Dismisses Click Fraud Report

Google is taking issue with a report that says click fraud hit a record high in the fourth quarter.

By Juan Carlos Perez
Thu, January 29, 2009

IDG News Service — Google is taking issue with a report that says click fraud hit a record high in the fourth quarter.

On Wednesday, Click Forensics said the incidence of click fraud rose to 17.1 percent in the fourth quarter, the highest rate since the company began tracking this problem in April 2006. Click Forensics provides services to monitor ad campaigns for click fraud.

Google questions the report's validity. "These estimates continue to count clicks Google does not charge to advertisers as fraudulent, so they are not actually click fraud estimates," a Google spokeswoman said via e-mail when asked for comment about the report.

"Furthermore, their estimates have never reflected the invalid click rates we see at Google, which we have previously stated have remained in the range of less than 10 percent of all clicks every quarter since we launched AdWords in 2002," she said.

Click fraud is a highly sensitive issue for Google, which generates most of its revenue from the type of online advertising affected by this problem. Click fraud happens when someone clicks on a pay-per-click (PPC) ad with malicious intent or by mistake.

For example, a competitor may click on a rival's PPC ads in order to drive up their ad spending. Also, a publisher may click on PPC ads on its site to trigger more commissions. Click fraud also includes nonmalicious activity that nonetheless yields a click of little or no value to the advertiser, such as when someone clicks on an ad by mistake or two consecutive times.

Google and Click Forensics have often locked horns in the past over the rate of click fraud. Google has accused Click Forensics of being inept in its methodology and misleading in its results in order to make the problem seem bigger than it is. Meanwhile, Click Forensics has charged that Google has purposefully trivialized click fraud and mischaracterized it as a minor problem.

In October, in a case of strange bedfellows, Google began publicly cooperating with Click Forensics by agreeing to accept the electronically generated click-quality reports generated by the Click Forensics FACTr service. However, it's evident the companies still have significant disagreements regarding the issue of click fraud incidence.

Search advertising is the largest online ad format, generating about 40 percent of all online ad spending, and Google is by far the largest provider of this type of ad, with industry estimates that it nabs more than 70 percent of search ad spending.

Click Forensics generates its quarterly click-fraud incidence report using its Click Fraud Index, which gathers data from more than 4,500 online advertisers and agencies that use ad services from all major search engines.

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