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Jul. 28th, 2006

The judge handed down the ruling; the class action was approved. Google will pay $30 million to the lawyers; $60 million will be available for reimbursements (in the form of ad credits) to click fraud victims. I'm disappointed (but not surprised) at the outcome. If Google had not agreed to compensate click fraud victims, the Tuzhilin report might have been viewed in a different light.

Something that has surprised me about this case is the number of people who are actually willing to live with the estimated 15% of click fraud that occurs on top-tier search engines and ad networks. The reasoning is that even with an estimated 15% loss of revenue, these advertisers are getting better ROI than on other media, such as print or broadcast. What this says to me is that established media is overpriced, and may be in for some rocky times, as more money shifts to online media. I'll have more to say on this in a future post.

Comments

( 1 comment — Leave a comment )
nsingman
Jul. 29th, 2006 12:40 pm (UTC)
I'm disappointed that the usual third of the settlement goes to the ambulance chasers. :-)

You make a good point about advertisers treating the loss of revenue as just another cost of doing business. The positive spin on that is that they're pragmatic; the negative spin is "unprincipled."
( 1 comment — Leave a comment )

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