It all began when Danny Sullivan published an article exposing a Google experiment in which it tested Bing. According to Michael Gray of Atlas Web Service, the test, essentially, showed that Bing used the data from Google’s toolbar to duplicate its search results, a move that Google considers “copying.”

Gray went on to explain to WebProNews that the accusation of click fraud is “a little far-reaching.” Although the technology was the same, it didn’t cost Bing any money since there weren’t any PPC campaigns involved. He said that if Google did suspect that Bing was copying them, this method was the only way it would have found out the truth.

So, who’s right, and who’s wrong? Gray believes that both companies are in the wrong to an extent. Based on his analysis, Microsoft was wrong to take the data from the toolbar and use it in their ranking algorithm without testing it further.

Google’s wrongdoing, on the other hand, stems from past events. As he explains, Ask introduced universal search long before Google did, and Yahoo introduced Yahoo Instant long before Google released its version of it. In addition, Gray points out that Google seems to make product announcements at other people’s press events and play it off as a coincidence. Although Google, typically, says that it has been working on these products for long periods of time, some people interpret their actions in each of these scenarios differently.

The timing of this latest turn of events seemed to be somewhat of a coincidence as well since Sullivan’s article was published just before both companies were set to take the stage at the Farsight Summit.

“Google’s playing hardball and they’re a serious, competitive company; they like to hold onto their market share, and they’re not taking things laying down,” he said.

As for the lesson for marketers in all this, Gray said that marketers need to expand their efforts beyond SEO to include other areas, such as social media.

He also pointed out that this situation is “good news for Bing” because it means that Google considers them as a viable competitor.

How do you think this saga will play out, and how will it impact the search industry?

For starters, click fraud is driven by 2 major incentives:

1.    Attacking advertisers – when an advertiser tries to hide one of his competitors
2.    Inflating affiliates – when an AdSense publisher tries to fraudulently increase his own revenue by generating false clicks

Methods of click fraud stem from simplistic techniques to sophisticated techniques. Simplistic methods include manual clicks such as when a fraudster personally clicks ads on his own computer. It gets a little more sophisticated when a fraudster organizes botnets and uses them for click fraud. Click farms, which consist of individuals or organizations that try to hire people to click on ads continuously, fall somewhere in the middle of the simple and sophisticated click fraud techniques.

Shuman does point out that: “the impact of invalid clicks at Google is minimal.”

Google detects click fraud through simple rules and statistical anomaly detection. Google’s simple rules consist of certain rules they have already defined as what they classify as an invalid click. Since some simple rules can be easily broken, statistical anomaly detection is more effective because it looks at specific activities on websites and compares the expected behavior to the observed behavior. This data gives Google a better understanding of how to detect invalid clicks.

For advertisers wanting to take proactive measures to prevent click fraud, Shuman advises keeping the return on investment (ROI) as the central focus. Research and gather as much data as possible, test everything, and track all results. If you apply these actions and your ROI drops for no reason, you have a good reason to suspect undetected click fraud and should file a claim.

Ideally, sources appearing in Google News US are US-based sources with high authority and page rank. Not too long ago, Google tweaked its algorithm to make it more difficult for low-authority blogs and low-quality rewrite sites to make into the Google News index. Either the algorithm is not as tough on foreign sources as it is US sources, or someone’s gaming the system.

Take Playfuls.com, for instance, a Cypress-based publication. Playfuls has close to 8,000 listings in Google Entertainment News, exceeding even long established paper of record the New York Times.

Or how about Spirit India dot com, which held the top Health News spot for it’s article about the effect of dairy products on fertility, trumping nearly 300 other sources, including Fox News, Bloomberg, and Atlanta Journal Constitution. Intermixed with those sources are publications out of Belfast and even China.

So which is it? Is Google’s algorithm simply not tight enough? Or Is Google getting gamed for traffic?

The click fraud debate should get rolling again, now that Google has made a detected click fraud rate available. Danny Sullivan reported this as less than zero point zero two percent. That refers to clicks that make it past Google’s multiple layers of detection and have to be refunded to clients. The actual percentage of clicks that are detected as invalid, whether caught by Google or refunded later, is somewhere between one and nine percent. Third party companies have reported much higher rates of click fraud, which had caused a number of advertisers to question Google’s effectiveness in stopping them.

If search engines want to reject advertisements from would-be clients, a federal judge in Delaware said they are free to do so. A lawsuit filed by Christopher Langdon against Google, Yahoo, and Microsoft claimed his rights to free speech were infringed. But a U.S. District Court judge said search engines were free to reject his ads as part of their First Amendment rights. The court also found that existing communications law supported the search engines’ right to filter objectionable content. Langdon had wanted to run ads criticizing politicians in North Carolina, and the Chinese government.

Type one happens on search results page. In this scenario a childish competitor clicks your ads, ad infinitum, until they’ve run out your budget, effectively removing your presence. Type two happens on a publisher’s site. Here, someone builds a site, populates it with ads, then employs a bot net to click ads and raise a profit at the advertiser’s expense.

Contrary to popular belief, type one is much more rare. According to Marshall, rule one of click fraud inoculation is, “follow the money.” When that trail is blazed, surely we’ll corner our fraud but (in some scenarios) wouldn’t search engines stand to benefit? Google gets a portion of click pays in the same manner as the publisher. Is there an incentive in such cases for search engine’s to battle click fraud?

Marshall think so. “In the end, it irritates advertisers like you wouldn’t believe!” Thus, it stands to reason that (as their major source of income) search engines would like to keep them happy.

On the issue of progression within the battle on click fraud, Marshall points out our inequities and strengths, “There’s a fundamental problem… in that completely automated techniques to detect this are extremely difficult to develop. Since there’s a financial incentive on the part of click fraud perpetuator to make it happen. You have an arms race where any automated technique that you have ends up being defeated. It’s impossible for engines to completely rein in and detect this. There’s a certain amount that advertisers MUST do… (they) should be looking at the data.”

Even though it’s an unpopular theory, Marshall believes that no fully automated system will ever succeed… it’s the warning systems and human intervention which will make for a better solution to click fraud.