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Why Not Pay Per Click?
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Why Pay Per Click Doesn't Work
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Hundreds of thousands of businesses have tried to get customers using the varioud pay per click programs designed to drive traffic to their websites.
Unfortunatley a mjority of them have not received sales from the millions of dollars spent due to click fraud and the lack of purifying of the visitors that they paid to have visit their websites.
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April 10, 2006 4:00 AM PDT
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With a planned $90 million settlement, Google could soon dispense with a class-action lawsuit involving so-called click fraud.
But while that may be good for Google, it doesn't mean the problem of bogus clicks on online ads--which advertisers have to pay for--is going to disappear anytime soon. A lack of clear standards for determining what is a fraudulent click, or some sort of third-party clearinghouse to monitor the situation, means some advertisers believe they can't do much more than head to the courts when they think there's a problem.
Certainly, Google and Yahoo, which run the two largest pay-per-click advertising networks, say they're addressing the problem. But some click auditing companies still claim that between 20 percent and 35 percent of clicks on Net advertisements are fraudulent.
"The proof will really be in the pudding going forward," Danny Sullivan, editor of Search Engine Watch said last week. "If this lawsuit gets settled and people six months later still feel like Google is charging them for fraudulent clicks on ads, there could be another lawsuit."
Unfortunately, there's no easy answer. Some experts say the solution is to have an independent auditor that would use data from the search engines and advertisers to determine in a neutral environment whether clicks are fraudulent.
Google and Yahoo, however, appear reluctant to embrace that idea. Google, which makes 99 percent of its revenue off ads on search results and partner publisher sites, says it doesn't want to give up data that rivals could use to improve their business. "Detecting invalid clicks accurately is a competitive advantage and differentiator, and as such, we compete with Yahoo and others to provide the best detection possible," said Shuman Ghosemajumder, business product manager for trust and safety at Google.
A Yahoo representative said in an e-mail: "We're open to coordinating with third parties as long as they truly understand the intricacies of the search advertising space, but feel that it's more important right now for the industry to establish some standards around how to measure click fraud."
What Yahoo and Google think about the issue is critical, because they're the primary networks for online ads. Marketers can bid on keywords that will appear on search results pages through Google's AdWords and Yahoo's Search Marketing programs. Google AdSense and the Yahoo Publisher Network allow marketers to advertise on Web sites that contain content related to the ads. Advertising on America Online's network is powered by Google. Yahoo powers search advertising on MSN, and MSN is launching its own contextual ad network with publisher sites.
Click fraud can occur in several situations. Sometimes, a company clicks on a rival's ads in an effort to deplete the rival's online advertising budget. But usually, it's due to Web site owners clicking on ads on their own sites to drive up revenue. Click fraudsters can either pay people to click on ads for hours in so-called "click farms;" use "clickbots," software programs written to automate the ad clicking; or "botnets" that hijack numerous machines for that purpose.
There is no way to tell for certain how big the problem is, because search engines refuse to provide any statistics or data. They simply say that they have systems to detect the majority of fraudulent clicks and that they credit or reimburse advertisers who are charged for bad clicks that somehow slip through the filtering software cracks.
The perception among advertisers, however, is that it's a growing problem. A study released in February by the Search Engine Marketing Professional Organization found that the number of online advertisers and search engine marketing companies that believe click fraud is a serious issue has tripled in the past year to 16 percent.
Despite those figures, click fraud is not deterring spending on search marketing, which JupiterResearch predicts will rise from $4.2 billion in 2005 to $7.5 billion in 2010.
With that much money at stake, it shouldn't be a surprise that advertisers are looking to companies such as the click audit firm Alchemist Media and credit card transaction auditor Fair Isaac, which are studying the pay-per-click (PPC) market.
"Many advertisers are just at the beginning stages of looking at their traffic data," said Alchemist Media president Jessie Stricchiola. "They don't know how big of a problem it is. They are just relying on the reports search engines send them, even though the search engines don't have access to post-click data" such as purchases.
Google said it gets post-click information, including conversion data, from thousands of advertisers.
Google last month announced the proposed settlement to a lawsuit filed a year earlier in Arkansas by Lane's Gifts and Collectibles and Caulfield Investigations. Google is offering advertising credits to customers who say they were not reimbursed for invalid clicks on their ads, with a cap on expenses of $90 million. It is unclear when the court will rule on the settlement. Meanwhile, the case is still pending against Yahoo and several smaller search companies.
But while that may be good for Google, it doesn't mean the problem of bogus clicks on online ads--which advertisers have to pay for--is going to disappear anytime soon. A lack of clear standards for determining what is a fraudulent click, or some sort of third-party clearinghouse to monitor the situation, means some advertisers believe they can't do much more than head to the courts when they think there's a problem.
Certainly, Google and Yahoo, which run the two largest pay-per-click advertising networks, say they're addressing the problem. But some click auditing companies still claim that between 20 percent and 35 percent of clicks on Net advertisements are fraudulent.
"The proof will really be in the pudding going forward," Danny Sullivan, editor of Search Engine Watch said last week. "If this lawsuit gets settled and people six months later still feel like Google is charging them for fraudulent clicks on ads, there could be another lawsuit."
Unfortunately, there's no easy answer. Some experts say the solution is to have an independent auditor that would use data from the search engines and advertisers to determine in a neutral environment whether clicks are fraudulent.
Google and Yahoo, however, appear reluctant to embrace that idea. Google, which makes 99 percent of its revenue off ads on search results and partner publisher sites, says it doesn't want to give up data that rivals could use to improve their business. "Detecting invalid clicks accurately is a competitive advantage and differentiator, and as such, we compete with Yahoo and others to provide the best detection possible," said Shuman Ghosemajumder, business product manager for trust and safety at Google.
A Yahoo representative said in an e-mail: "We're open to coordinating with third parties as long as they truly understand the intricacies of the search advertising space, but feel that it's more important right now for the industry to establish some standards around how to measure click fraud."
What Yahoo and Google think about the issue is critical, because they're the primary networks for online ads. Marketers can bid on keywords that will appear on search results pages through Google's AdWords and Yahoo's Search Marketing programs. Google AdSense and the Yahoo Publisher Network allow marketers to advertise on Web sites that contain content related to the ads. Advertising on America Online's network is powered by Google. Yahoo powers search advertising on MSN, and MSN is launching its own contextual ad network with publisher sites.
Click fraud can occur in several situations. Sometimes, a company clicks on a rival's ads in an effort to deplete the rival's online advertising budget. But usually, it's due to Web site owners clicking on ads on their own sites to drive up revenue. Click fraudsters can either pay people to click on ads for hours in so-called "click farms;" use "clickbots," software programs written to automate the ad clicking; or "botnets" that hijack numerous machines for that purpose.
There is no way to tell for certain how big the problem is, because search engines refuse to provide any statistics or data. They simply say that they have systems to detect the majority of fraudulent clicks and that they credit or reimburse advertisers who are charged for bad clicks that somehow slip through the filtering software cracks.
The perception among advertisers, however, is that it's a growing problem. A study released in February by the Search Engine Marketing Professional Organization found that the number of online advertisers and search engine marketing companies that believe click fraud is a serious issue has tripled in the past year to 16 percent.
Despite those figures, click fraud is not deterring spending on search marketing, which JupiterResearch predicts will rise from $4.2 billion in 2005 to $7.5 billion in 2010.
With that much money at stake, it shouldn't be a surprise that advertisers are looking to companies such as the click audit firm Alchemist Media and credit card transaction auditor Fair Isaac, which are studying the pay-per-click (PPC) market.
"Many advertisers are just at the beginning stages of looking at their traffic data," said Alchemist Media president Jessie Stricchiola. "They don't know how big of a problem it is. They are just relying on the reports search engines send them, even though the search engines don't have access to post-click data" such as purchases.
Google said it gets post-click information, including conversion data, from thousands of advertisers.
Google last month announced the proposed settlement to a lawsuit filed a year earlier in Arkansas by Lane's Gifts and Collectibles and Caulfield Investigations. Google is offering advertising credits to customers who say they were not reimbursed for invalid clicks on their ads, with a cap on expenses of $90 million. It is unclear when the court will rule on the settlement. Meanwhile, the case is still pending against Yahoo and several smaller search companies.
But while that may be good for Google, it doesn't mean the problem of bogus clicks on online ads--which advertisers have to pay for--is going to disappear anytime soon. A lack of clear standards for determining what is a fraudulent click, or some sort of third-party clearinghouse to monitor the situation, means some advertisers believe they can't do much more than head to the courts when they think there's a problem.
Certainly, Google and Yahoo, which run the two largest pay-per-click advertising networks, say they're addressing the problem. But some click auditing companies still claim that between 20 percent and 35 percent of clicks on Net advertisements are fraudulent.
"The proof will really be in the pudding going forward," Danny Sullivan, editor of Search Engine Watch said last week. "If this lawsuit gets settled and people six months later still feel like Google is charging them for fraudulent clicks on ads, there could be another lawsuit."
Unfortunately, there's no easy answer. Some experts say the solution is to have an independent auditor that would use data from the search engines and advertisers to determine in a neutral environment whether clicks are fraudulent.
Google and Yahoo, however, appear reluctant to embrace that idea. Google, which makes 99 percent of its revenue off ads on search results and partner publisher sites, says it doesn't want to give up data that rivals could use to improve their business. "Detecting invalid clicks accurately is a competitive advantage and differentiator, and as such, we compete with Yahoo and others to provide the best detection possible," said Shuman Ghosemajumder, business product manager for trust and safety at Google.
A Yahoo representative said in an e-mail: "We're open to coordinating with third parties as long as they truly understand the intricacies of the search advertising space, but feel that it's more important right now for the industry to establish some standards around how to measure click fraud."
What Yahoo and Google think about the issue is critical, because they're the primary networks for online ads. Marketers can bid on keywords that will appear on search results pages through Google's AdWords and Yahoo's Search Marketing programs. Google AdSense and the Yahoo Publisher Network allow marketers to advertise on Web sites that contain content related to the ads. Advertising on America Online's network is powered by Google. Yahoo powers search advertising on MSN, and MSN is launching its own contextual ad network with publisher sites.
Click fraud can occur in several situations. Sometimes, a company clicks on a rival's ads in an effort to deplete the rival's online advertising budget. But usually, it's due to Web site owners clicking on ads on their own sites to drive up revenue. Click fraudsters can either pay people to click on ads for hours in so-called "click farms;" use "clickbots," software programs written to automate the ad clicking; or "botnets" that hijack numerous machines for that purpose.
There is no way to tell for certain how big the problem is, because search engines refuse to provide any statistics or data. They simply say that they have systems to detect the majority of fraudulent clicks and that they credit or reimburse advertisers who are charged for bad clicks that somehow slip through the filtering software cracks.
The perception among advertisers, however, is that it's a growing problem. A study released in February by the Search Engine Marketing Professional Organization found that the number of online advertisers and search engine marketing companies that believe click fraud is a serious issue has tripled in the past year to 16 percent.
Despite those figures, click fraud is not deterring spending on search marketing, which JupiterResearch predicts will rise from $4.2 billion in 2005 to $7.5 billion in 2010.
With that much money at stake, it shouldn't be a surprise that advertisers are looking to companies such as the click audit firm Alchemist Media and credit card transaction auditor Fair Isaac, which are studying the pay-per-click (PPC) market.
"Many advertisers are just at the beginning stages of looking at their traffic data," said Alchemist Media president Jessie Stricchiola. "They don't know how big of a problem it is. They are just relying on the reports search engines send them, even though the search engines don't have access to post-click data" such as purchases.
Google said it gets post-click information, including conversion data, from thousands of advertisers.
Google last month announced the proposed settlement to a lawsuit filed a year earlier in Arkansas by Lane's Gifts and Collectibles and Caulfield Investigations. Google is offering advertising credits to customers who say they were not reimbursed for invalid clicks on their ads, with a cap on expenses of $90 million. It is unclear when the court will rule on the settlement. Meanwhile, the case is still pending against Yahoo and several smaller search companies.
But while that may be good for Google, it doesn't mean the problem of bogus clicks on online ads--which advertisers have to pay for--is going to disappear anytime soon. A lack of clear standards for determining what is a fraudulent click, or some sort of third-party clearinghouse to monitor the situation, means some advertisers believe they can't do much more than head to the courts when they think there's a problem.
Certainly, Google and Yahoo, which run the two largest pay-per-click advertising networks, say they're addressing the problem. But some click auditing companies still claim that between 20 percent and 35 percent of clicks on Net advertisements are fraudulent.
"The proof will really be in the pudding going forward," Danny Sullivan, editor of Search Engine Watch said last week. "If this lawsuit gets settled and people six months later still feel like Google is charging them for fraudulent clicks on ads, there could be another lawsuit."
Unfortunately, there's no easy answer. Some experts say the solution is to have an independent auditor that would use data from the search engines and advertisers to determine in a neutral environment whether clicks are fraudulent.
Google and Yahoo, however, appear reluctant to embrace that idea. Google, which makes 99 percent of its revenue off ads on search results and partner publisher sites, says it doesn't want to give up data that rivals could use to improve their business. "Detecting invalid clicks accurately is a competitive advantage and differentiator, and as such, we compete with Yahoo and others to provide the best detection possible," said Shuman Ghosemajumder, business product manager for trust and safety at Google.
A Yahoo representative said in an e-mail: "We're open to coordinating with third parties as long as they truly understand the intricacies of the search advertising space, but feel that it's more important right now for the industry to establish some standards around how to measure click fraud."
What Yahoo and Google think about the issue is critical, because they're the primary networks for online ads. Marketers can bid on keywords that will appear on search results pages through Google's AdWords and Yahoo's Search Marketing programs. Google AdSense and the Yahoo Publisher Network allow marketers to advertise on Web sites that contain content related to the ads. Advertising on America Online's network is powered by Google. Yahoo powers search advertising on MSN, and MSN is launching its own contextual ad network with publisher sites.
Click fraud can occur in several situations. Sometimes, a company clicks on a rival's ads in an effort to deplete the rival's online advertising budget. But usually, it's due to Web site owners clicking on ads on their own sites to drive up revenue. Click fraudsters can either pay people to click on ads for hours in so-called "click farms;" use "clickbots," software programs written to automate the ad clicking; or "botnets" that hijack numerous machines for that purpose.
There is no way to tell for certain how big the problem is, because search engines refuse to provide any statistics or data. They simply say that they have systems to detect the majority of fraudulent clicks and that they credit or reimburse advertisers who are charged for bad clicks that somehow slip through the filtering software cracks.
The perception among advertisers, however, is that it's a growing problem. A study released in February by the Search Engine Marketing Professional Organization found that the number of online advertisers and search engine marketing companies that believe click fraud is a serious issue has tripled in the past year to 16 percent.
Despite those figures, click fraud is not deterring spending on search marketing, which JupiterResearch predicts will rise from $4.2 billion in 2005 to $7.5 billion in 2010.
With that much money at stake, it shouldn't be a surprise that advertisers are looking to companies such as the click audit firm Alchemist Media and credit card transaction auditor Fair Isaac, which are studying the pay-per-click (PPC) market.
"Many advertisers are just at the beginning stages of looking at their traffic data," said Alchemist Media president Jessie Stricchiola. "They don't know how big of a problem it is. They are just relying on the reports search engines send them, even though the search engines don't have access to post-click data" such as purchases.
Google said it gets post-click information, including conversion data, from thousands of advertisers.
Google last month announced the proposed settlement to a lawsuit filed a year earlier in Arkansas by Lane's Gifts and Collectibles and Caulfield Investigations. Google is offering advertising credits to customers who say they were not reimbursed for invalid clicks on their ads, with a cap on expenses of $90 million. It is unclear when the court will rule on the settlement. Meanwhile, the case is still pending against Yahoo and several smaller search companies.
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April 22, 2008 12:51 PM PDT
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A lawsuit filed Tuesday in federal court accuses Google of deceiving its customers into paying for ads they didn't expressly request.
The lawsuit, which seeks class action status, was filed by the firm of Kabateck Brown Kellner in U.S. District Court in San Jose, Calif., on behalf of David Almeida, a Massachusetts-based private investigator who enrolled in Google AdWords in November 2006.
When participating in Google's online auction-based advertising system, customers specify what they would be willing to pay per-click for words or phrases that will trigger ads displayed on Google's search site, as part of Google AdWords. They are also given the option of bidding for ads that appear on third-party Web sites, also called Google's "content network," which is part of Google AdSense.
When customers do not bid for ads on third-party sites, Google places ads there anyway and automatically charges customers the amount they specified for ads on Google.com, the lawsuit says.
On the system, customers see two blank boxes, one for typing in a bid for ads on Google.com and another one, marked "optional," for putting ads on content network sites. Sophisticated search engine marketers know to put a "0" in the box for the content network AdSense sites if they don't want ads there, says Brian Kabateck, lead counsel on the case. "For most people, if you see a box and leave it blank, you think you're not going to be charged," he says.
Google does not inform its advertisers that if they leave the box next to the content bid blank, Google will use the advertiser's bid for clicks occurring on the content network, the lawsuit says. There is no option to opt out of content ads during the process, according to the document.
"Ads on third-party sites are widely acknowledged to be far less effective (and therefore less valuable to the advertiser) than ads on Google.com," a statement from Los Angeles-based Kabateck Brown Kellner says. "Google, of course, still profits greatly from these ads."
A Google spokesman said: "We have not been served with the complaint and will have no comment until we have the chance to review it."
Kabateck recently won a multimillion-dollar click fraud settlement from Yahoo and was part of a $90 million click fraud settlement from Google on behalf of advertisers who sued the search companies claiming they were charged for clicks on ads that were fraudulent.
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Published: May 3, 2006 5:46 PM PDT
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Instead of the "highly targeted" sites the ads are supposed to appear on, the ads end up on low-quality sites that show random ads and little or no bona fide content, according to the lawsuit, filed Monday in New Jersey federal court.
Spyware programs are unwanted software installed on users' computers without their express consent that can display unwanted and annoying pop-up ads, transmit personal information about the user and slow computers. The New York Attorney General's Office investigated spyware programs and alleged that Yahoo had placed ads into spyware provided by Intermix and Direct Revenue, the lawsuit notes, although it does not name Intermix and Direct as defendants.
Using an example of typosquatting, the suit said that mistyping Expedia as "expedai.com" displayed a site with ads provided by Yahoo, including an ad for Expedia.
The lawsuit, which seeks class-action status against Yahoo and a group of unnamed third parites, was filed on behalf of Crafts by Veronica, a Newark, N.J.-based retailer that declined to comment. It accuses Yahoo of breach of contract, unjust enrichment, civil conspiracy and violations of the New Jersey consumer fraud act.
Yahoo is charging for pay-per-click (PPC) advertising "even though defendants knew that a substantial percentage of click revenue resulted from PPC advertisements shown improperly, including in ways that contravene defendants' contracts with its advertising customers," the lawsuit alleges.
The lawsuit also alleges that Yahoo not only chose to ignore abuse of its PPC advertising system by spyware and typosquatter sites, but also "knowingly...manipulated that system for their own benefit, by increasing the volume of improper advertising displays during financial reporting periods when defendants were at risk of failing to meet investor expectations."
"We're not going to comment on this matter other than to say that we plan to vigorously defend our position," a Yahoo representative wrote in an e-mail seeking comment.
One of the lawyers on the case said Yahoo could have taken steps to address the problem. "They could have refused to partner with spyware companies," said Ben Edelman, a spyware expert and Harvard doctoral candidate. "Instead, they are partnering with spyware companies and have paid out millions of dollars in advertising money to them."
Anyone who purchased ads on Yahoo's pay-per-click ad system in the last six years can join the lawsuit after it is certified as class action by the court, he said.
Yahoo remains a defendant in a click fraud lawsuit that Google settled for $90 million that claims search engines overcharged customers for click fraud, or illegitimate clicks on ads designed to either generate revenue for a Web site publisher or make an advertiser pay out more in advertising.
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Published: May 11, 2006 8:10 PM PDT
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"The settlement is just a joke," said plaintiff Joseph Kinney, a Pinehurst, N.C., security consultant who said he has lost about $1,500 to click fraud on ads related to his SafeSpaces.com Web site. "A jury needs to hear these issues and Google needs to be held accountable."
Lane's Gifts and Collectibles and Caulfield Investigations sued Google and other search engines in February 2005 in state court in Texarkana, Ark., accusing them of charging advertisers for clicks on online advertisements that were fraudulent or done in bad faith and not with the intention of legitimate commerce.
Google reached a settlement with the plaintiffs in March that provides for $30 million to be used for lawyer fees and $60 million to pay credits to affected advertisers. The settlement would not apply to other defendants, namely Yahoo, Lycos, Miva, Go.com and LookSmart.
The Arkansas judge has scheduled a two-day hearing to begin on July 24 to consider whether to give the proposed settlement final approval, said Shawn Khorrami, one of the lawyers listed on the latest lawsuit, which was filed before the same Arkansas judge as the initial lawsuit. Khorrami also represents a plaintiff in a similar lawsuit filed in California against Google.
The latest lawsuit argues that the settlement should be rejected because it would not adequately compensate advertisers who lost money from fraud.
"The settlement leaves advertisers in worse shape than they are now. There is no benefit that the class (of advertisers) is getting at all," said Khorrami, who is based in Los Angeles.
"Under the settlement, Google can pay a half a percent of your losses," or $5 on every $1,000 of losses claimed, he said. For instance, a loss of $10,000 would garner a coupon worth $50 from Google that could used only to buy more advertising through Google, he added.
Google defended the settlement. "Lawyers for the California plaintiffs are trying to circumvent the normal class action process, which we believe is inappropriate," Google said in statement. "We question if this lawsuit may be motivated more by the quest for attorneys' fees than pursuit of what's best for class members."
If the court agrees to block the proposed settlement, the case would be free to either proceed to trial or continue settlement negotiations with Google, said Khorrami, who also represents Web hosting company AIT in a click fraud-related lawsuit filed against Google last year in San Jose, Calif. That lawsuit is on hold pending the outcome in the Arkansas case, Khorrami said.
Khorrami and others have created a Web site that advises advertisers of their rights in opting out of the proposed settlement.
Once Google sends out notices to its advertisers notifying them of the proposed settlement, advertisers will have 30 days to opt out of the settlement, Khorrami said. Google so far has not sent out the notices, which must go out before the judge approves it, he said.
The settlement would not solve the underlying problem of click fraud, experts have said. It is unclear how much of a problem it is. Google and other search engines say they catch most click fraud and that it is not a serious issue.
A recent study found that click fraud at the major search engines is about 14 percent. Other estimates--from companies that stand to profit off click-fraud detection-related software and services--have pegged it as high as 30 percent.
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July 5, 2006 4:19 PM PDT
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Study: Click fraud could threaten pay-per-click model
Staff Writer, CNET News.com Published: July 5, 2006 4:19 PM PDT
Online advertisers estimate that about 14.6 percent of the clicks on ads for which they're billed are fraudulent, costing them about $800 million last year, according to a study released Wednesday.
The study, called "Click Fraud Reaches $1.3 billion, Dictates End of 'Don't Ask, Don't Tell' Era" and released by research and advisory firm Outsell, claims that "Google, Yahoo and MSN...are stonewalling on click fraud, to their own and others' detriment."
Search engines have refused to release figures on the amount of fraud in search advertising, most of which comes from Web sites boosting their revenue by clicking on ads on their own sites.
A recent study from the Click Fraud Network put the click fraud rate at 14 percent, while other companies that sell click fraud detection and prevention services have pegged it at 20 percent to 30 percent. Search companies say it is much lower than that and is under control.
The total effect of the $1.3 billion mentioned in the Outsell study represents $800 million spent on fraudulent clicks by advertisers and $500 million that advertisers say they no longer spend on pay-per-click advertising, the study said. Pay-per-click is the primary revenue source for Google and a big revenue contributor for Yahoo.
The survey of 407 advertisers also found that 27 percent said they had already slowed or stopped their pay-per-click advertising, including 16 percent who have curtailed such spending entirely.
Seventy-five percent of those surveyed said they had experienced click fraud, and 7 percent said they'd requested refunds and had netted an average of $9,507.
In response to an e-mail seeking comment, a Google representative sent a statement that said: "We take this issue very seriously, have devoted significant resources to it, believe we manage it very well and believe the problem is small."
A Yahoo representative provided this statement: "Yahoo views click fraud as a serious, but manageable challenge. In fact, it was one of the first challenges we identified when we created the pay-per-click advertising model in 1998, which is why we built a robust, proprietary click through protection system very early on."
Yahoo's click through protection system has identified and not billed advertisers for billions of clicks, including those resulting from click fraud and clicks that were improperly billed, Yahoo said.
"We are very confident in our system's ability to detect fraudulent clicks, but we also recognize that our customers--and the industry as a whole--have many questions and concerns about click fraud, especially given the litigation that Yahoo and other search engines have been engaged in over the past few years."
A Microsoft representative released a statement that said: "Microsoft recognizes that invalid clicks, which include clicks sometimes referred to as 'click fraud,' are a serious issue for pay-per-click advertising."
Both Google and Yahoo have been sued over click fraud and both have settled the cases.
Last week a judge gave preliminary approval to a settlement agreement Yahoo reached with Checkmate Strategic Group. Under the deal, Yahoo would pay about $5 million in legal fees and review advertiser click fraud complaints from January 2004.
Earlier this year, Google announced that it would pay $90 million in advertising credits and attorneys fees to settle a class-action lawsuit over click fraud.
A lawsuit designed to block the settlement has been filed by advertisers who claim Google is getting off too cheap.
Some experts have said the only way to solve the problem is to create an independent auditor to monitor click fraud.
The Search Engine Marketing Professionals Organization is teaming up with Fair Isaacs, an independent company that tracks credit card fraud, to measure the true size of click fraud and its effects on search-engine advertising.
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A lawsuit filed this week alleges that Yahoo is charging advertisers for "premium" ads that are displayed on illegal sites that show spyware pop-up ads and typosquatter sites that appear when a surfer misspells a Web address. 