Google, Yahoo! et al take aim at click fraud

by admin August 3, 2006 at 4:29 am

A case of ‘the fox guarding the hen house’?

After numerous class-action lawsuits and criticism from advertisers, the major web search companies finally announced on Wednesday plans to work together with two industry groups to quantify click fraud.

Click fraud occurs when online ads are intentionally clicked on, either by websites which get paid for hosting the ads or by companies trying to deplete the ad budgets of rivals so they can buy the search keywords themselves and steal the business.

The Interactive Advertising Bureau (IAB) and the non-profit Media Rating Council said they are teaming up with, Google, LookSmart, Microsoft, Yahoo! and others to form the Click Measurement Working Group.

The group’s mission is to establish guidelines for what constitutes valid clicks and invalid clicks on ads. Guidelines can help the industry measure how prevalent click fraud really is. Third-parties which sell click-fraud combating services to advertisers claim click fraud rates are as high as 30 per cent. Google and Yahoo! counter that click fraud rates are minimal.

The IAB said the guidelines will outline an industry-driven auditing and certification recommendation for search engines, online ad networks, third-party ad servers and other companies that make money from clicks. For example, Google’s pay-per-click ad system requires advertisers to pay a fee each time one of their online ads is clicked.

IAB chief Greg Stuart couldn’t give a time frame for when guidelines might be set but said the group is hoping to hold its first meeting by the end of this month.

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