Google has been called on the carpet by a prominent spyware fighter for contributing to the bottom line of Internet snoopsters.
“By paying spyware vendors to show advertisements, Google both enlarges and prolongs the spyware problem,” Harvard Business school Assistant Professor Ben Edelman recently wrote on his Web site.
“In particular,” he continued, “Google’s funding supports software that users struggle to remove from their computers. Google’s payments make it more profitable for vendors to sneak such software onto users’ computers in the first place.”
Edelman’s criticism of Google is largely based on the search king’s relationship with two firms: InfoSpace and WhenU. InfoSpace, among other things, distributes Google pay-per-click advertising. It uses subcontractors, like WhenU, to assist in circulating those ads.
According to Edelman, WhenU, through its spyware, collects cash from Google through some questionable ad practices. Here’s the problem.
When an advertiser buys a pay-to-click ad, it pays when a consumer clicks on the ad and goes to the advertiser’s site. If the consumer makes a purchase, the value of that ad increases and that added value is taken into account when the ad is renewed.
What spyware makers will do through software planted on a user’s computer is pop-up a window containing Google ads after a consumer arrives at a site through a pay-per-click ad. Moreover, among the Google ads in the Window is one for the site behind the pop-up. The advertiser ends up paying for both ads, although only one–the original click-to-pay ad–delivered a customer to the site.
The problem is compounded when the pop-up appears over a page where a click has been converted into a purchase. “[W]hen advertisers evaluate the PPC [Pay Per Click] traffic they bought, they overvalue this ‘conversion inflation’ traffic–leading advertisers to overbid and overpay,” Edelman explained.
He cited an example of a WhenU pop-up at the Web site for Continental Airlines. When he landed on the site, a pop-up appeared that contained a prominently placed Google ad for the air carrier. Not only that, but the ad in the pop-up suggested that clicking on it would lead to lower fares at the “official” Continental site. “In fact both suggestions are inaccurate, but a reasonable user would naturally reach these conclusions based on the wording of the advertisement and the context of its appearance,” he maintained.
What’s more, he contended that the WhenU pop-up violates Federal Trade Commission rules that sponsored search results be clearly labeled as such. He confessed, however, that the sponsorship message might appear on a computer with a larger display. (His display was 800-by-600 pixels.) Nevertheless, the FTC rules make no exceptions based on screen size, he added.
Edelman, who has been following the activities of InfoSpace and its subaltern WhenU for almost a year, called on Google to clean up its act. It could start that process by cutting loose from InfoSpace, he proposed. Not only does InfoSpace have a track record of improper placement of Google ads, he complained, but “Google does not need a distributor whose business model entails farming out ad placements to subdistributors.”
“If InfoSpace’s subdistributors seek to distribute Google ads, and to be paid for doing so, let them apply directly to Google and undergo Google’s ordinary quality control and oversight,” he recommended. “Inserting InfoSpace as an additional intermediary serves only to lessen accountability.”
He had another suggestion that would cause a howl of protest in the boardrooms of most companies.
“Google also needs to pay restitution to affected advertisers,” he said. “Every time Google charges an advertiser for a click that comes from InfoSpace, Google relies on InfoSpace’s promise that the click was legitimate, genuine, and lawfully obtained,” he reasoned. “But there is ample reason to doubt these promises.”
“Google,” he continued, “should refund advertisers for corresponding charges–for all InfoSpace traffic if Google cannot reliably determine which InfoSpace traffic is legitimate. These refunds should apply immediately and across-the-board–not just to advertisers who know how to complain or who manage to assemble exceptional documentation of the infraction.”
As extreme as Edelman’s recommendations may seem to some, their underlying premise remains sound. As long as malicious software makers can profit from their malevolent activity, they will continue to conduct it. The fact that some of these players can operate under a thin veneer of legitimacy only emboldens their more nefarious brethren.