Safin
Forerunner
New lawsuit sure to shake up the online ad payment system
In a case that could have far reaching if not devestating effects for the online pay per click ad service providers like google, overture and host of others; the recent lawsuit agains google for click fraud is sure to shake up the industry. Read more as TechEnclave provides you exclusive reports and details on this story and what it means for thousands of google and other ad agencies customers.
  Put up ads on your site, let members click and you take the share of the cash while some part is kept by the ad agency. Its a wonderful formula and is almost ubiquitously followed by almost all the sites now. And its enormously successful too as can be judged by the fact that google, the largest in the online ad business has itself acknowledged that its 99% profits are from ads.
  In this light the lawsuit filed by Click Defense threatens not just the search engine giant, but the entire revenue making model for most search engines.
 So whats this all about. Well the case has been filed against google for click fraud and not doing enough to prevent it. The nightmare had been brewing for at least a year, when you may have heard the first estimates of click fraud representing as much as 20 percent of the fees in some advertising categories. Click fraud, a fairly new term then, occurs when websearch pay-per-click ads are deliberately clicked by users who do not plan to do business with the company represented by the ad. Sometimes performed by software, sometimes by humans (some people are even paid by companies to perform the task), click fraud could cost a company many thousands of dollars before it realized what was happening. Yet click fraud is an industry term, not a legal term; it is not legally defined as “fraud.” But the lawsuit recently filed by Click Defense just might change that.
 On June 24, 2005 in a U.S. District Court in San Jose, California, Click Defense filed a lawsuit against search engine giant Google. The company is seeking class action status for its suit. The filing, which runs to 18 pages, accuses Google of breach of contract, negligence, unjust enrichment, and unfair business practices. Click Defense believes that Google has not done enough to protect its advertisers from click fraud, or reimburse those who have suffered damages from it. Click Defense is seeking $5 million in damages.
  If successful, this lawsuit stands to do far more damage to Google and other search engines than the loss of money. Given that Google’s net revenue for the first quarter was $1.3 billion, a mere $5 million, though noticeable, would register more as the cost of doing business. The problem is that the lawsuit attacks Google right in its main revenue stream – advertising. And if Google is vulnerable, why not all of the other search engines that make a significant amount of money from pay-per-click ads?
  But what is even more worrying for all such companies is that there is lot of support for the cause that click Defense has raised. Recent surveys conducted by two major organizations, Search engine marketing Professionals Organization (SEMPO) and Online survey interantional have shown that more and more companies are worried about click fraud than ever before. In this light, if Click Defense manages to win the lawsuit, we could be seeing a flurry of more lawsuits coming.
 So its one battle that sure to heat up and is sure to have wide ranging concequences. Stick around with TechEnclave for more on this developing story.
SuperNova for TechEnclave
In a case that could have far reaching if not devestating effects for the online pay per click ad service providers like google, overture and host of others; the recent lawsuit agains google for click fraud is sure to shake up the industry. Read more as TechEnclave provides you exclusive reports and details on this story and what it means for thousands of google and other ad agencies customers.
  Put up ads on your site, let members click and you take the share of the cash while some part is kept by the ad agency. Its a wonderful formula and is almost ubiquitously followed by almost all the sites now. And its enormously successful too as can be judged by the fact that google, the largest in the online ad business has itself acknowledged that its 99% profits are from ads.
  In this light the lawsuit filed by Click Defense threatens not just the search engine giant, but the entire revenue making model for most search engines.
 So whats this all about. Well the case has been filed against google for click fraud and not doing enough to prevent it. The nightmare had been brewing for at least a year, when you may have heard the first estimates of click fraud representing as much as 20 percent of the fees in some advertising categories. Click fraud, a fairly new term then, occurs when websearch pay-per-click ads are deliberately clicked by users who do not plan to do business with the company represented by the ad. Sometimes performed by software, sometimes by humans (some people are even paid by companies to perform the task), click fraud could cost a company many thousands of dollars before it realized what was happening. Yet click fraud is an industry term, not a legal term; it is not legally defined as “fraud.” But the lawsuit recently filed by Click Defense just might change that.
 On June 24, 2005 in a U.S. District Court in San Jose, California, Click Defense filed a lawsuit against search engine giant Google. The company is seeking class action status for its suit. The filing, which runs to 18 pages, accuses Google of breach of contract, negligence, unjust enrichment, and unfair business practices. Click Defense believes that Google has not done enough to protect its advertisers from click fraud, or reimburse those who have suffered damages from it. Click Defense is seeking $5 million in damages.
  If successful, this lawsuit stands to do far more damage to Google and other search engines than the loss of money. Given that Google’s net revenue for the first quarter was $1.3 billion, a mere $5 million, though noticeable, would register more as the cost of doing business. The problem is that the lawsuit attacks Google right in its main revenue stream – advertising. And if Google is vulnerable, why not all of the other search engines that make a significant amount of money from pay-per-click ads?
  But what is even more worrying for all such companies is that there is lot of support for the cause that click Defense has raised. Recent surveys conducted by two major organizations, Search engine marketing Professionals Organization (SEMPO) and Online survey interantional have shown that more and more companies are worried about click fraud than ever before. In this light, if Click Defense manages to win the lawsuit, we could be seeing a flurry of more lawsuits coming.
 So its one battle that sure to heat up and is sure to have wide ranging concequences. Stick around with TechEnclave for more on this developing story.
SuperNova for TechEnclave
