| 6:24 pm on Sep 14, 2008 (gmt 0)|
I think one point is missed here by almost everybody is on his site google adsense ads are still showing.
So in my opinion he is not kicked out of adsense but his bidding has increased in Adwords.
So all the hue and cry about google is not justified in my opinion.
If he is found guilty of Adsense then google would not have served the Ads in his site at all.
| 8:44 pm on Sep 14, 2008 (gmt 0)|
Arbitrage getting cut out of the loop is good, very good. I can only hope for more of the same.
| 9:00 pm on Sep 14, 2008 (gmt 0)|
|Arbitrage getting cut out of the loop is good, very good. I can only hope for more of the same. |
I agree but that's not the case yet.
It's only those that Google don't want to do arbitrage, it's selective.
It should be all or none, not fuzzy and grey.
| 9:02 pm on Sep 14, 2008 (gmt 0)|
|So in my opinion he is not kicked out of adsense but his bidding has increased in Adwords. |
We didn't miss that point, we know AdSense is still running.
You miss the point that Google is just arbitrarily pricing him out of business.
How would you like it if someone arbitrarily charged you double or triple to bring customers to your site while everyone else paid lower rates?
That's not a fair business practice whatsoever.
| 9:11 pm on Sep 14, 2008 (gmt 0)|
>>charged you double or triple to bring customers to your site while everyone else paid lower rates?
But is he the only one? Haven't there been loads of people whose rates went up, some to even $5 or $10 a click?
| 9:26 pm on Sep 14, 2008 (gmt 0)|
|It should be all or none, not fuzzy and grey. |
There are a lot of "should be's" that I hope for with Google, an end to their fuzzy grayness is not something I ever expect.
If anything they are getting more opaque and more arbitrary as time goes on.
But in as much as eliminating arbitrage is eliminating the middle-man I'm all for it and I applaud Google's action even if cloaked in fuzzy grayness and doesn't apply to all.
| 9:45 pm on Sep 14, 2008 (gmt 0)|
Had I run into that site before reading the article, I'd probably have marked that site MFA.
| 10:22 pm on Sep 14, 2008 (gmt 0)|
|It's only those that Google don't want to do arbitrage, it's selective. It should be all or none, not fuzzy and grey. |
But the very question of whether a publisher is engaged in arbitrage is "fuzzy and grey." Making that determination requires either human intelligence or an algorithm that takes multiple variables into account.
Consider: Nytimes.com buys traffic with Google AdWords (and AdSense), and it also runs AdSense ads on its pages. Does that mean Nytimes.com is a click arbitrageur? For most of us, the answer would be "Of course not," because (a) THE NEW YORK TIMES is clearly a legitimate and reputable publisher of intrinsically valuable content; and (b) AdSense ads are just one of its revenue streams. That may be hard for someone with an "all or nothing" perspective to grasp, but that doesn't mean Google should be required to view AdSense publishers in binary terms.
| 10:46 pm on Sep 14, 2008 (gmt 0)|
I poked around the site and discovered that while some categories have extensive lists of businesses, it didn't take much looking to find empty categories with no real content, only ads.
Such pages are of little use to anyone except the arbitrageur.
Reorganizing to reduce the number of poorly populated categories might make the algo like the site better.
| 10:56 pm on Sep 14, 2008 (gmt 0)|
There are some relevant points made in this thread, from right around the time in question:
| 1:26 am on Sep 15, 2008 (gmt 0)|
Everyone seems to be making this way more complex than it should be. I look at it from this perspective:
Man pays Google $5
Google pays man $10
Google makes loss of $5.
This is simple mathematics. If I was Google I wouldn't like that arrangement either!
| 1:29 am on Sep 15, 2008 (gmt 0)|
>>>This is simple mathematics.
No, no, you're missing the most important figure here, the advertiser. You forgot the advertiser who is paying Google and the arbitrageur. Google doesn't lose a cent.
| 2:01 am on Sep 15, 2008 (gmt 0)|
This happened over 2 years ago, wasn't that about the time that datafeed-driven affiliate sites were getting kicked out of organic search? This isn't solely about arbitrage, if it were, why didn't Google tell them that their business model isn't compatible, like they've told others? It was and is about landing page quality. How much would a datafeed affiliate site without content have to pay for Adwords clicks, based on landing page quality?
And incidentally, if Google's got quality raters for organic search, which doesn't drive revenue, is it 100% impossible that there might be Adwords quality raters with guidelines to follow, when their business model and revenue is involved?
As a point of interest, in answer to the question I asked at the beginning of this thread about that huge number of homepage backlinks showing at Yahoo, in Spring of 2006 (back around the month when their AW rates went up) SourceTool was, according to their site at the time, charging $199 per year for a "verified" listing which was waived if they gave a homepage text link back. They provided the code to link back as a matter of fact
Additionally, although prior to Spring, in February of that year, they were claiming to be a member-funded initiative, how likely is it that they were a featured site of the week when it plainly said on their site that Spring that while they don't sell advertising, they do benefit from Google Adsense.
Nothing against the concept of their taxonomy and business model, but how many clicks does it take to finally get to a link to a company's site, and why are those links excluded from bots?
[edited by: Marcia at 2:03 am (utc) on Sep. 15, 2008]
| 2:02 am on Sep 15, 2008 (gmt 0)|
|Google doesn't lose a cent. |
right. the missing piece is "man generates clickthrough on another advertiser's ad. Other advertiser then pays google $12."
therefore google makes $7.
| 11:50 am on Sep 15, 2008 (gmt 0)|
|right. the missing piece is "man generates clickthrough on another advertiser's ad. Other advertiser then pays google $12." |
therefore google makes $7.
When a visitor comes from MFA page to MFA page clicking on ads to land on an other MFA page, the visitor will stop clicking AdSense ads.
So this costs Google and all honest publishers much money.
This is the reason, that I have my 200 competitive ad filter nearly full. I want to ban bad sites.
| 11:51 am on Sep 15, 2008 (gmt 0)|
"And incidentally, if Google's got quality raters for organic search, which doesn't drive revenue"
Thats a typo right?
| 3:30 pm on Sep 15, 2008 (gmt 0)|
I just responded about this in the AdWords forum, so I'll just paste what I wrote below. But ultimately, I do not think this is an AdSense issue at all. It's an AdWords issue, because the nature of his site is such that it would be extremely difficult to run an effective and efficient AdWords campaign for it. I've been doing AdWords for all kinds of clients for years, and I don't think I'd take it on myself, because it would be more time consuming than cost effective.
|I didn't see anything all that wrong with his business model, from what little I could tell just by looking at his site. I really don't think the AdSense is the problem there; he doesn't seem like the typical arbitrage site at all. |
However, the way AdWords works, his site, pretty much by definition would have a hard time maintaining a decent quality score.
You've got three elements that have to be in near perfect sync with each other - the keywords in the adgroup, the text of the ad and the landing page.
With a dynamically driven site like this guy has, and with thousands of different types of businesses listed, it'd be more than three full time jobs just writing and managing AdWords ads and campaigns.
** Generic AdWords advertising doesn't work anymore. **
The whole point of quality score is that Google wants to make sure when someone clicks on an ad, he's going to have a pretty good idea going in what he's going to find when he gets there. This article uses the example of ball bearings - well, that would not be a good quality keyword for him, because his site doesn't sell ball bearings. It may provide listings for vendors of ball bearings, but it doesn't offer ball bearings. So the more proper keyword for him would be "ball bearing suppliers" or "ball bearing vendors"
If I'm looking for ball bearings, Google figures I should know ahead of the click whether or not I'm going to a place where I can actually get them, or I'm going to a list of other places that sell them - even if it's a very good, accurate list with reviews and rankings and everything. So his ad would also have to say that he has listings for ball bearing vendors, and not just the ball bearings.
I know it may seem like a nit picking distinction to some, but all my experience tells me this is the way it works, and until you come to that fundamental understanding where you can see the difference, you're always going to struggle with AdWords.
Which is also why I think the program has outgrown a large part of the market it was originally intended for (small business owners who could run it themselves)
(And for what it's worth, I've been running AdWords to drive traffic to my AdSense monetized event site for a number of years with no problem maintaining 3 cents/click on search)
| 3:43 pm on Sep 15, 2008 (gmt 0)|
Interesting observations, netmeg.
|Which is also why I think the program has outgrown a large part of the market it was originally intended for (small business owners who could run it themselves) |
FWIW, that may help to explain why some AdSense publishers are hurting. If, for example, you've got a site about Widgetville B&Bs and the owners of B&Bs in Widgetville find AdWords/AdSense too complicated to deal with these days, the program's increased complexity is likely to be bad from your perspective. It will be interesting to see whether Google can find a way to make AdWords/AdSense less intimidating to the kind of business owner whose media-buying experience is limited to classified ads and two-inch display ads in local newspapers or trade publications. (And if Google can't make AdWords/AdWords more accessible to Wally at the Widgetville Motel, who'll step in to serve that market?)
| 3:59 pm on Sep 15, 2008 (gmt 0)|
There was an item about that in the AdWords forum within the past couple months; I think annej started it?
Ah yes, here it is:
(One thing I sure wish WebmasterWorld had was the ability to link an item into more than one forum, at the moderators' discretion, because there are plenty of issues, particularly with Google AdWords and AdSense, that span more than one niche)
| 5:45 pm on Sep 15, 2008 (gmt 0)|
When the reporter asked Nicholas Fox, Google’s product manager for ad quality about what problems the algorithm had with SourceTool, Mr. Fox did not provide a direct answer. He also didn't explain why a site like Business.com could get away with it while SourceTool could not.
To be fair, that's maybe not a good comparison because Business.com does not seem to be supporting itself primarily through arbitrage. The reporter has a good understanding but might be a bit over his head. Nevertheless he goes on to make an interesting general observation about monopolies, which is at the heart of this story.
|The problem with monopolists, of course, is that they just can’t help acting like monopolists, even supposedly benign monopolists like Google and even when they are not consciously trying to rub out the competition. They are always right and everybody else is wrong... They tell small fry like Mr. Savage to stop bugging them. |
That is how Microsoft acted a decade ago, and that, increasingly, is how Google is acting. Half the time, the company doesn’t even realize how egregious its behavior has become, which is why it feels so misunderstood when it is criticized.
...his story gave me pause, and nothing Google said in its defense defused my alarm. As Mr. Litvack reviews the Google-Yahoo deal, I hope it gives him pause as well.
It could be déjà vu all over again.
| 5:57 pm on Sep 15, 2008 (gmt 0)|
Well yea, and it's absolutely true that Google's communication systems with both advertisers and publishers are abysmal - you're as likely to get three different answers as you are to get no answer at all.
But I still don't think it's an AdSense issue nearly as much as an AdWords issue. AdWords, as it's currently set up , is just not a good fit for this type of business model. And with Yahoo and MSN adCenter picking up a lot of Google's QS type attributes, I think he'd eventually had the same problems advertising with them as well.
| 6:06 pm on Sep 15, 2008 (gmt 0)|
The French have another saying, in English it is, "the more things change, the more they are the same."
These situations develop along the same lines because they are driven by the same thing, human nature, which doesn't change.
Unlike Microsoft, Google's monopoly is not anchored with installed software that is expensive to replace and relearn so their market share can evaporate much more quickly. Their attempts to install their free software into user's brains is evidence that they are acutely aware of this.
They are probably bright enough to wake up before someone else eats their lunch but the arrogance and hubris engendered by monopoly does make more openings for the little furry creatures who are awaiting the asteroid.
| 9:54 pm on Sep 15, 2008 (gmt 0)|
Rants about "monopolies" are a distraction from the fact that Google has the right to set standards--and to judge compliance--for its advertisers and publishers.
Maybe Google's QC staff decided that SourceTool sucks. If so, bad luck for SourceTool. In any case, AdWords/AdSense does not have a monopoly on the generation of traffic or revenue, and a legitimate business directory with intrinsically valuable content should be able to obtain both by other means.
| 10:16 pm on Sep 15, 2008 (gmt 0)|
This is no rant, it's a complaint sent by the site owner's attorney that the DOJ may be considering as part of their investigation.
| 10:32 pm on Sep 15, 2008 (gmt 0)|
|The whole point of quality score |
The whole point is why should Google dictate vs. the visitors and the advertisers?
Google is jacking up prices on sites making it clearly an unfair advantage to the advertiser.
Do you think a newspaper charges a different price for some restauarant that did pass health inspection than one that does?
That's what we're talking about here, Google deciding who's the best instead of letting the market decide which kills off businesses daily in the real world.
| 11:06 pm on Sep 15, 2008 (gmt 0)|
|Google deciding who's the best instead of letting the market decide |
It would have taken millions of visitors to generate the kind of income that the site allegedly earned for a while. If so few of those visitors bookmarked or linked to the site that it is paralyzed without AdWords traffic, then the market has indeed decided.
I agree with signor_john that Google has the right to decide what kind of experience it wants to deliver to its own users.
Just like you or I do.
| 11:15 pm on Sep 15, 2008 (gmt 0)|
|In any case, AdWords/AdSense does not have a monopoly on the generation of traffic or revenue, and a legitimate business directory with intrinsically valuable content should be able to obtain both by other means. |
Absolutely untrue. Google has an effective monopoly, a lock on worldwide mind share, and such a huge percentage of the ad business that all the others combined are inconsequential. There are a few isolated places where it faces chalenges in search and advertising but the English speaking world is not one of them.
Unlike Microsoft, this monopoly was positively formed by Google's being the best choice, but now that it exists Google has some very cushy laurels to rest upon and can easily do so. Google will never become lean and mean again, it will continue to bloat like Microsoft.
| 2:14 am on Sep 16, 2008 (gmt 0)|
|Absolutely untrue. Google has an effective monopoly, a lock on worldwide mind share, and such a huge percentage of the ad business that all the others combined are inconsequential. |
Google does not have "such a huge percentage business that all others combined are inconsequential." That may be true of one advertising category (search and contextual text ads), but so what? Unless the site we've been discussing is a click arbitrageur, why should it have to rely solely on search or contextual text ads for traffic and revenue?
As for IncrediBILL's newspaper analogy, how newspapers set their rates is irrelevant. However, it's worth pointing out that newspapers don't charge uniform rates. For that matter, they exercise the right (and the power) to accept some ads and refuse others.
| 5:05 am on Sep 16, 2008 (gmt 0)|
|Google is jacking up prices on sites making it clearly an unfair advantage to the advertiser. |
This is a good for most good advertisers.
I visited 2005 ads by the AdSense Preview Tool, where it was very difficult to find the product mentioned in the ad.
With the quality score, this companies think about improving the landing page score, the conversion goes up, the ad prices go down.
So this is a good service from Google for the advertiser.
| 8:11 am on Sep 16, 2008 (gmt 0)|
Arbitrage isn't the problem wholly, its still going strong after all for the people with the right feed relationships and the search sites are still banking from it (like they have done the last 10 yrs). Its fairly obvious that recent times have been partly about reducing the number of players which was getting out of hand in the ppc affiliate space.
What is flawed is the execution and I think the mixed messages from the search sites. Its got to make your blood boil if your landing pages are suddenly penalised only to see presumably larger more connected sites (eg Ask.com and others) happily carrying on without a care. A less than level playing field is going to fuel the fires and makes an obvious mockery of the whole QS concept which is what drives some of the anger I am sure.
| 1:37 pm on Sep 16, 2008 (gmt 0)|
|Google does not have "such a huge percentage business that all others combined are inconsequential." That may be true of one advertising category (search and contextual text ads), but so what? Unless the site we've been discussing is a click arbitrageur, why should it have to rely solely on search or contextual text ads for traffic and revenue? |
Ordinary human beings do not have the capital or the agility to simply change their business model overnight. If they did then Google would not have a monopoly in this sector. In the hypothetical world that exists solely for your argument yes, they could just go out and do something else the next day. In the actual world thousands of individuals and businesses are trapped by the real-world stranglehold that Google has on this sector, their monopoly. In absolute terms there are no monopolies. In the 1870's to the 1900's there was nothing stopping people from going out and drilling their own oil wells, opening their own steel mills and building their own railroads, but somehow the Rockefellers and the Vanderbilts of the world held on to their monopolies.
The only growth sector in advertising is monopolized by Google.
Keyword arbitrage is not wholly a parasite in this market, it does help to set values. While I personally avoid it, it exists because there is imperfect information in the marketplace. A greater number of players would help, but since there is a monopoly Google can regulate and learn from it by direct action as it did with Mr. Savage.
A monopoly deals with these things in a way that appears more unfair than if the marketplace simply drove Mr. Savage out of the business.
edited for factual, historical clarity
[edited by: OnlyToday at 1:53 pm (utc) on Sep. 16, 2008]
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