gregbo (gregbo) wrote,

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A security expert weighs in on the click fraud debate

Bruce Schneier, author of Applied Cryptography, has commented on the click fraud problem from the more formal standpoint of authenticating people. This article has also made it to Wired, and there is another debate on it at Slashdot.

More and more people are talking about click fraud now, and some of them are security people. They have experience in this area; they know what the true nature of the problem is; they know what types of solutions need to be applied. This was inevitable; it is now just a matter of time before some statements are made in very public places about the problem.

So ... a question to anyone who's working at Google, or holds shares in the company. Are you at least a little concerned? Not that I expect you to reply publicly, but doesn't the fact that security experts think CPC advertising is just asking for fraud bother you somewhat? At the very least, are you a little concerned that Google executive management is taking a rather casual attitude towards the whole thing?

Of course there is the argument that the click fraud has been factored into the prices people pay for ads, and thus into GOOG's stock price. OTOH, the highest target I've heard quoted by analysts is $600, but the analyst (unfortunately, can't remember who) seemed to think this was a reasonable valuation based in what MSFT had traded at some time ago. So this estimate had less to do with what GOOG might trade at if click fraud did not exist, and more to do with what GOOG might trade at if it was valued in a way that MSFT was once valued.

Anyway, GOOG and YHOO are reporting earnings next week. Should be some interesting calls ...
Tags: click fraud

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