April 15th, 2005

classic cylon

click fraud was inevitable

Charles Warner, a professor and media veteran, has written a piece titled Click Fraud Was Inevitable in his blog. He feels that the major search engines will eventually switch to a CPM (cost per thousand impressions) pricing model, and that Yahoo will lead the way. I think this is doubtful, considering that Overture pioneered CPC (PPC) advertising, and that its (financial) success was a major factor in Yahoo's purchase of it.

I wonder if PPC (and thus click fraud) is here to stay. There certainly seems to be a lot of support for PPC, at least among web marketing and sales executives. The fact that Google has been wildly successful with PPC, despite click fraud, entrenches it further within the overall economic system of web advertising. I think this is unfortunate. Also, after thinking about it awhile, I came to the conclusion that Google probably decided to adopt PPC because they didn't want to leave all that revenue on the table (for Overture and others to pick up). I still wonder if there were people within Google who objected to PPC on technical grounds, predicting that it would allow click fraud to run rampant and add complex and costly overhead to their operation.

BTW, he was GM of WNBC (now WFAN) radio in NYC during the time I enjoyed listening to it in the late 1970s. The location of its transmitter and the salt water path between it and the south shore of Cape Cod allowed me to tune it in as if it were a local station. The signal was just about as clear as WRKO's. (WFAN 660 kHz, WRKO 680 kHz.)