May 04, 2005

Google's customer service: bad and getting worse

Google apparently has some work to do when it comes to keeping their paying customers (advertisers) happy. "Google has always been bad -- worse than bad, even," said Dana Todd, president of a 300 member trade group of marketing professionals.

The CNN article that quote was taken from also mentions the last tech ad company to show such arrogance because of market domination was America Online- right before it ended up getting bitch slapped by the dot.com implosion. The subsequent uncovering of massive accounting fraud by AOL's advertising division was just icing on the cake.

But hey- isn't maps.google.com so friggin' sweet? That's good enough for me!

May 04, 2005 | Permalink | Comments (2) | TrackBack (0)

May 02, 2005

Google officially launches animated ads

Been waiting for some X-10 spy camera ads from Google? Well wait no longer.

Google has officially launched their program to start selling animated banner ads alongside their existing text ads.

This article states that Google is no longer a technology company, and their business is no longer search. It is now a media company. Of course the last time we heard this was when AOL declared they were a media company, only to see their stock drop 95% within the span of 12 months.

Analysts quoted in the article call it a win/win situation because Google can now attract "big-name advertisers that favor flashy Wed ads promoting their brands."

And who doesn't love flashy web-ads! Punch the monkey and win an iPod, indeed!

May 02, 2005 | Permalink | Comments (13) | TrackBack (3)

April 29, 2005

Google risks losing its core search business:

Recent developments at Google have actually gotten even the most gushing fanboys to start wondering aloud- does Google have any idea what in the hell they are doing?

Or are they copying the playbook from every dot.com stock in history, trying to confuse investors with an endless stream of new product announcements- none of which actually make any money?

More and more, people are finally coming around to the dark side and daring to question whether or not Google really is the greatest thing since sliced bread. Read the article for yourself.

While the author of that piece may be correct, he is forgetting the most important thing- the execs at Google could not care less what happens to the company at this point. The top ten executives have sold over two billion dollars worth of GOOG stock in the last six months, and they're all set for life. The stock could drop to zero tomorrow and none of them would lose a minute of sleep over it- which is exactly what happened with almost every dot.com before this one.

April 29, 2005 | Permalink | Comments (3) | TrackBack (2)

April 25, 2005

Google Adsense- now with enhanced bullshit!

One of the main reasons the Slashdot crowd seemed to give Google some slack was that their advertisements were "small and unobtrusive" text-based pitches.

Not any more. Google has announced they are going to start letting advertisers insert graphics and animation into their Adsense advertisements. Sort of like banner ads used to be, until people got used to them and started clicking on text ads because they didn't realize they were ads at all. Wait a second- does a two year absence for animated banners mean people are now clamoring for the ad formats they abandoned back then?

Why doesn't Google go ahead and bring back the <BLINK> tag? It worked well in 1996, didn't it?

April 25, 2005 | Permalink | Comments (6) | TrackBack (1)

April 22, 2005

Google claims trademark on the sound "oogle" and sues tiny company

No, I'm not making that up.

Google has actually filed a 68 page lawsuit against Froogles.com for trademark infringement. Never mind that Froogles.com was registered years before Google decided to name their own shopping site "Froogle."

In Google's outrageous new legal argument, they claim they own exclusive use of any word that sounds like "oogle."

How's that "Don't be evil" thing working out, Sergey?

April 22, 2005 | Permalink | Comments (3) | TrackBack (1)

April 20, 2005

The more insider stock sold, the higher Google's earnings:

There's a blurb in the Wall Street Journal today that explains how Google's reported bottom line is being gamed by their own options program. It seems since they backloaded the options expense onto last year's earnings statement, this quarter's results will be ARTIFICIALLY BOOSTED almost 100%, even though it has absolutely nothing to do with their actual profitability as a business. Keep that in mind when they announce earnings tomorrow.

It's the same sort of trick Cisco pulled when their stock collapsed 80% back in 2000. They "wrote off" several billion dollars worth of equipment they said they could never be able to sell, and took a huge charge against earnings. Then over the following quarters they decided they'd sell that equipment after all, but it was all sold at a 100% profit margin since their "cost" was now free. This allowed Cisco to fool investors for a little while longer, and more importantly allowed their insiders to cash out billions.

April 20, 2005 | Permalink | Comments (12) | TrackBack (2)

April 19, 2005

Yahoo accuses Google of lying about click fraud

Here we go again!

Another article just came out detailing how one little shop managed to earn around $50,000.00 in no time by hiring people to click on Google ads.

Here's a hint, folks. There are thousands of scammers doing exactly the same thing, every single day, except they don't get caught. Google simply doesn't have the technology to catch them: the reason they claim their click fraud detection methods have to remain secret is because THEY DO NOT EXIST.

Google's public relations department has decided to just flat out lie to the public:

"This is not a significant problem," Google's Kamangar said. "Google's technology detects invalid clicks, including instances when publishers click on their own ads."

Yahoo's John Slade immediately calls bullshit: "If there is anybody who says this is not a real problem, they are kidding you"

So who's lying, Yahoo or Google? Read the article and decide for yourself.

April 19, 2005 | Permalink | Comments (1) | TrackBack (0)

April 14, 2005

Google plans to change appearance of ads to fool users

As we've said over and over- the fundamental reason text-based ads have such a high clickthrough rate is simple: people are tricked into thinking those paid spots are just regular links on a website.

To that end, over the least 6 months nearly every Adsense participant on the net has gone down the path of removing the border around their ads and/or making sure the background color matches that of their own content- thus further eroding the editorial/advertising moral barrier. (here's a typical example of such formatting modifications)

Despite all these efforts, click-through rates continue to drop. It seems people are becoming accustomed to the standard Adsense format and are far less likely to click than they used to. The same thing happened with banner ads back in the early days of the web: at first many people didn't understand those things were actually ads- but eventually they caught on and the effectiveness of banners plummeted to almost nothing.

Google's solution? Change the look of Adsense and hope a whole new wave of clueless clickers will keep advertisers happy for a while.

April 14, 2005 | Permalink | Comments (4) | TrackBack (1)

April 08, 2005

Google's PR department spreading the bullshit on thick

There must be at least 700 stories across the news wires this evening, all with the same headline: "Google execs cut their salary to 1 dollar a year." The implication is clear- Eric, Larry, and Sergey are humble people who aren't cashing out and leaving shareholders holding the bag.

Tell you what- when you're chatting around the water cooler and someone mentions any of that intentionally deceptive pablum to you as a reason why Google is such a great company, why don't you also tell them that those same three "miserly" executives- Eric Schmidt, Larry Page, and Sergey Brin have quietly sold over 500 million dollars worth of Google stock in the last THREE MONTHS ALONE. They are cashing out faster than any dot.com in history- putting all previous records to shame. In fact, if you're reading this site for the first time, you might think I'm making all that up- after all, wouldn't you have HEARD of these massive stock sales in the media?

Well no, not unless you like to read SEC filings or happened to see the story in the Washington Post. Don't believe me? Click on that link and read for yourself.

UPDATE: I was wrong- the total figure of stock sold by those three is now over 815 million dollars.

April 08, 2005 | Permalink | Comments (16) | TrackBack (2)

April 07, 2005

New York state government joins the "abuse trademarks" game

Purchasing trademark-based advertisements from Google is now apparently not only for businesses. Eliot Spitzer, the Attorney General of New York, got in hot water yesterday for purchasing the rights to the keyword "AIG" which is the stock symbol and name of an insurance giant currently under investigation by his agency for massive fraud and malfeasance.

As the article states: "Somebody didn't use good judgement."

By the way, Spitzer is nothing more than a grand-standing crook. He hasn't returned a DIME to investors who were ripped off over the last few years, but rather accepted settlements from various scum companies and deposited the money into his own department's accounts. I think the term for this sort of activity is a "shake down."

But hey, Google is glad to join in the party- they get paid no matter what the morals of the situation happen to be. Whether it's click-fraud businesses, or public-office-seeking hypocrites, Google is always amenable to cash.

April 07, 2005 | Permalink | Comments (3) | TrackBack (0)

April 06, 2005

Click fraud makes The Wall Street Journal's front page:

The mainstream press has finally seen the light- "click fraud" is today's lead story in the WSJ.

Unfortunately if you're not a subscriber, you can't read the text of their article online legally. Either find a message board where it has been posted (like this), or spend a buck and pick up an actual copy at a news stand.

One person quoted in the article said that probably upwards of 80% of clicks on high-priced keywords were completely fraudulent. Can you think of any other industry segment on earth where 80 percent of the revenue is tainted with fraud?

In my humble opinion, last quarter's record revenues at Google were entirely the result of a "fraud bubble." Advertisers were getting billed for massive increases in clicks- but instead of delivering legitimate customer leads, Google was actually delivering a massive increase in click fraud.

As the article points out, now those advertisers are rising up and telling Google to fuck off, because all that traffic they paid for isn't worth much of anything.

April 06, 2005 | Permalink | Comments (1) | TrackBack (1)

April 05, 2005

Katie, bar the door! Google just got sued for click fraud

It appears that the floodgates are officially open- word out tonight is that Google is finally being sued for click fraud, and for colluding with other companies to artificially inflate pay-per-click costs. If you look closely at that article you might notice the terms "conspiracy" and "class action" are mentioned- not what shareholders usually like to hear.

I'm shocked, I tell ya- SHOCKED. It's not like I've been predicting this would happen for the last year in a blog or anything; oh, wait..

Another news article about the same lawsuit points out that while Google claims to have sophisticated anti-fraud technology in place, they have never provided any proof whatsoever that such technology exists, and they're not subject to any audits by any third parties. In other words, they could be robbing everyone blind and there isn't a damn thing paying advertisers can do about it because Google says everything is a trade secret.

Of course, the only reason Google can get away with this is due to their near-monopoly status in the marketplace. For example, could you imagine if any other commerical website refused to allow independent traffic auditing and tried to sell advertising based on traffic numbers they pulled out of thin air?

"Why yes, Mr. Budweiser Ad Sales Guy, FuckedGoogle.com gets 47 billion unique visitors a day so I will demand you pay one million dollars to display a banner ad on my site for one month. No, you may not see my traffic logs. You'll just have to trust me."

April 05, 2005 | Permalink | Comments (2) | TrackBack (0)

Maybe I was wrong about Google

Click the picture to get a closeup of her shirt. No, really, click it.

This frame capture was taken from a recent Google propaganda video showing happy employees and prospective student employees listening with rapt attention to a seminar about how great and innovative Google is.

In deference to that spectacular pair of opposing arguments, perhaps I've been misguided all along? Mea culpa?

Naaaahhhh.

April 05, 2005 | Permalink | Comments (6) | TrackBack (0)

April 04, 2005

Rookie blogger experiences profound revelation:

Aw..... Isn't it so precious?

Is there anything more adorable than seeing someone take their first baby step towards tricking surfers into clicking on their Adsense ads?

This genius has discovered that if he removes the shaded border around the Adsense ads on his site, his clickthrough rates go up by 70 percent. In fact, he got so excited he had to tell all his friends about it on his blog! Oh, the drama! The angst!

You'll have to forgive him for his exuberance. After all, he just re-discovered the dirty little secret that Google's known for years: make advertising look almost exactly like the content and less than 19 percent of surfers will be able to "spot the ads." (as reported by the BBC- not me)

When people don't realize they're being sold to, they tend to click on things FAR more often- and that's putting it mildly.

Ever see those page-long newspaper ads that match the look and feel of the regular columns, but shill for some product or service or political cause? The advertisers do that for a very good reason. So does Google.

April 04, 2005 | Permalink | Comments (3) | TrackBack (1)

April 02, 2005

It's just a flesh wound.

It's easy to assume that the recent legal defeats Google has suffered in France don't really apply in the good 'ole USA. I mean, they're the FRENCH, for crying out loud. We can safely ignore anything those crazy croissant-eaters do, right?

Maybe not- it's beginning to appear that Google may be on the verge of getting nailed by our courts as well, and for precisely the same legal reasons:

This past Wednesday, US District Judge Jeremy Fogel denied Google's motion to dismiss the trademark violation lawsuit brought by American Blind, allowing the dispute to go forward to trial.

This is the EXACTLY the sort of lawsuit that Google has now lost three times in a row in France- that's not a very good batting average by even the most optimistic standards. At stake is the very ability of Google to profit from trademarks they do not own- which happens to be a really massive component of their revenue stream.

April 02, 2005 | Permalink | Comments (2) | TrackBack (1)

March 31, 2005

Massive pay-per-click fraud uncovered

One of the blog community's most respected names, WordPress, turns out to have been financing itself by gaming Google's search results with hundreds of thousands of fake articles designed to bogusly attract advertisers and users to click on high-priced keywords such as "mesothelioma," "mortgage," "insurance," and others.

This is the inevitable result of the fatally-flawed pay-per-click business model. There is every incentive in the world for all the players to defraud each other and absolutely no legal penalty if you get caught. The end result is something we've all seen- the first page or two of almost any search on Google is now filled with spammers and scammers who have rigged the system with linkfarms and cloaking and meta-abuse.

March 31, 2005 | Permalink | Comments (3) | TrackBack (0)

March 27, 2005

Google intentionally turning a blind eye to trademark abuse

While it may seem at first glance that the recent lawsuits in France over copyright and trademark disputes are just isolated incidents, an article published today in the International Herald Tribue points out that a core weakness in Google's business model may be under attack.

In case anyone has forgotten, Google's policy towards trademark exploitation wasn't always like this. In fact, before April of 2004 they didn't allow it at all. But with the IPO momentum building quickly, Google found itself with a tough decision to make: Should they cave in to the webmaster advertising community that had been begging for the ability to leech off of trademarked keywords?

If Google did, their reported revenues would soar and the IPO pricing would be much higher- however in doing so they would open themselves up to the chances of lawsuits down the road from pissed off trademark holders. It also should be mentioned that the US Government had just a few weeks previously all but ordered Google to stop accepting online casino advertisements, which was a *substantial* percentage of their total revenue that would now have to be replaced.

Viewed in that light, and given that everyone at Google knew they would be able to sell billions of dollars worth of stock before any of the consequences of that policy made it through the courts, Google decided to tell trademark holders around the world to go fuck themselves.

It appears that decision is finally coming home to roost.



March 27, 2005 | Permalink | Comments (1) | TrackBack (0)

March 23, 2005

Hey! Look over here! We gave up our bonuses!

In the Wall Street lexicon of time-tested PR moves, this one is a classic. I don't think there's a high tech public company that hasn't used it at least once:

All over the news tonight are stories of how Google is being "stingy" with the cashola- their board of directors officially decided not to give Sergey, Larry, and Eric any bonuses this year.

This, of course, is the news that will be repeated on CNBC in the morning, while failing to mention that those three execs have sold 500 million dollars worth of Google stock in the last three months alone.

If a half-billion dollars in your pocket doesn't count as a bonus, what does?

March 23, 2005 | Permalink | Comments (4) | TrackBack (1)

March 19, 2005

En France, Google just can't seem to fit in.

Like clockwork, another French company has decided they're going to sue Google over copyright infringement. Considering the last two companies that tried it, won, I don't see an end to this anytime soon.

In this case, it's a French news service who got tired of Google copying all their exclusive headlines and pictures for use on Google's own news service- without being paid. Getting paid for news is how news services tend to make a living, after all.

I did find it interesting that Google had been warned with a cease and desist order about this, and completely blew them off. Just an idea, but maybe Google should tread a little more lightly with a country that has shown itself willing and able to bitchslap them?

March 19, 2005 | Permalink | Comments (6) | TrackBack (0)

March 17, 2005

Google insider stock sales are "staggering" say analysts:

According to this evening's article in the Washington Post, Larry Page, Sergey Brin, and Eric E. Schmidt have sold over 500 million dollars worth of Google stock within the last three months.

This amount is larger than the *total* amount of actual profit Google has made as a company since the day it was founded. I want you to think about that for a moment. Then think about it again.

Now think about it one more time: If you add up every single penny of profit Google has ever made since they opened their doors, you would have an amount SMALLER than the value of stock those three execs have sold since Jan 1st of this year. If you add in the amount of stock other low-level employees of Google have sold since last August, the total comes to over 1.8 billion dollars- which is more than five times the total amount of profit Google has ever made as a business.

I think Keanu in his post-modernist wisdom put it best: "Whoah."

Google is no longer in the business of search, mail, maps, open source, VoIP, or whatever their daily business rumor/announcement happens to be. On a dollar for dollar basis, Google is now nothing more than a financial vehicle to allow Google execs to monetize shareholder ignorance on a scale the world has never seen before- as Warren Buffett so famously put it.

Even as judged by 1999 dot.com bubble levels of avarice and raw greed, Google insiders are leaving all the previous cash-out records in the dust. As of today they've actually surpassed the reigning champion: Naveen Jain of Infospace. And that's saying a lot.

March 17, 2005 | Permalink | Comments (2) | TrackBack (0)

March 16, 2005

French court REJECTS Google's appeal

It's all over except for the crying.

Google's profiteering from "trademark counterfeiting" in France will be coming to an end, the Associated Press just reported moments ago.

Although I have to admit, this is a blow for all paid-search advertising, not just Google.

In this case at least, it seems that Euros finally realized Google was making millions by tricking consumers into buying fake designer handbags when people were searching for "Louis Vuitton."

(those keywords were getting up in the price range of classics like "mesothelioma" and "poker" and "home mortgage" and "divorce", so this will likely have a serious impact on Google's income)

March 16, 2005 | Permalink | Comments (1) | TrackBack (0)

March 15, 2005

Microsoft joins the paid search party

Last week Yahoo announced they were gunning for Google's Adsense revenue, and today Microsoft is anouncing they are gunning for Google's paid search revenue.

To put this in perspective- just five days ago Google pretty much enjoyed a monopoly in both of those industry segments.

Does the term "priced for perfection" ring a bell, anyone?

March 15, 2005 | Permalink | Comments (0) | TrackBack (0)

March 11, 2005

Adsense to get competition from Yahoo

Yahoo is about to break into Google's Adsense turf, according to this article.

For small-to-medium website publishers, this will represent the first real competition Google has ever had for the contextual ad/publisher market. Up until now, Google has been able to basically pay publishers whatever they "felt like" while keeping the actual amount paid or bid by advertisers secret.

In other words, they have been hiding the fact that their monopoly status has been allowing them to have profit margins approaching 95% in this segment of their business.

Update: here's another article fresh off the presses that basically states Google's only competitive advantage right now is a near 100% monopoly on the "ad strip" industry. The author expects Google's profit margins to drop from around 80% to around 15% once Yahoo gives them *any* competition.

March 11, 2005 | Permalink | Comments (5) | TrackBack (0)

March 08, 2005

Google caught gaming it's own search results

I have to wonder if anyone out there will even be surprised at today's news about Google's spiral into the abyss of moral corruption and greed.

Just in case, here's the story that shows Google is now using the exact same Search Engine Optimization "tricks" that they explicitly forbid website operators from using in order to get higher rankings in search results.

I'm sure this is just an oversight in the "Don't be evil" grand plan.

March 08, 2005 | Permalink | Comments (0) | TrackBack (1)

March 07, 2005

TheStreet.com: "Google is faith based investing"

An interesting article came out this morning from Thestreet.com which (for a change) actually attacked Google on many of the issues brought up here before.

The article actually calls the executives at Google hypocrites four or five times, but then excuses them with the all too familiar "but hey, as long as they're making money, we don't care how they treat their shareholders, which, by the way, is terrible."

The other main showstopper in this article is when Google's CEO Eric Schmidt responds to an investment banker and reveals they don't really know where their advertising money comes from, which accounts for 98% of their revenue. The last time I heard a CEO say this the company was called Freddie Mac.

March 07, 2005 | Permalink | Comments (0) | TrackBack (0)

March 03, 2005

The New York Times investigates click fraud

In yet another case of mainstream media waking up to the the epidemic problem of click fraud in the "paid search" industry, the New York Times today published an article that basically sums up everything we've said here before. Namely, that individual advertisers are getting pretty pissed off about the fraud, and the search engines who profit from the nefarious activity aren't doing much about it.

Search engines are at a fundamental conflict of interest with regards to this issue- they get paid for every click whether it is fraudulent or not. It's against their financial best interest to dig too deeply into investigating fraud because it could sharply reduce their revenue. (Upwards of 20 percent of all pay-per-click advertising dollars are estimated to be bogus by most industry watchers)

And falling revenue could very well lead to a falling stock price, which equals less money in the pockets of search engine executives who are unloading insider shares hand over fist. (Google employees, for example, have sold 1.6 billion dollars worth of stock in the last 7 months alone- which is an amount several times larger than the total amount of profit Google has made as a company since the day it was founded)

Yeah, I know, this could never end badly. This bubble is unlike every one in history before- it will never pop.

March 03, 2005 | Permalink | Comments (1) | TrackBack (0)

Is Google really a one trick pony? Businessweek says yes.

Anyone who does more than a few minutes research into Google will see that they garner over 98% of their revenue from paid contextual search. (in other words, fooling people into thinking advertisements arent really ads)

But amazingly, you never hear that from anywhere except this website. Everyone was in love with Google- they could do no wrong. And for chrissake- they have thousands of PhDs on their staff- whatever they do must be a good business decision. Right?

Well, mass media is slowly starting to listen to what we've been saying here at fuckedgoogle for over a year: Businessweek declared today that Google is a one trick pony, with all of their eggs in one basket.

(italian stallion, the same role over and over... oh what the hell if you didn't get the picture joke it's too late now)

March 03, 2005 | Permalink | Comments (2) | TrackBack (0)

March 02, 2005

Pri-i-a-vate eyes.. they're watching you.. they see your eveeerry move

Ever wonder where on a Google search result the average person rests their eyes? I mean literally- what part of the screen are people staring at.

Well, wonder no more.

The new study shows why there is a gigantic industry of people spending every waking moment thinking of ways to game Google's algorithms and get top placement: almost nobody ever looks past the first result on any page.

March 02, 2005 | Permalink | Comments (0) | TrackBack (0)

February 28, 2005

Store owner admits the temptations of click fraud

Bruce Benton, a small business owner in Highland Park, Illinois, admits that he has had it with people bidding up paid search keywords to absurd prices. "It makes me want to go click it every time I can," he admits in this article out today.

Here's a hint- the only people who ever get caught at click fraud are people who:

1) click on their own site dozens of times per day

2) do it from the same IP that they started their initial adsense account

3) don't clear their cookies while doing 1) and 2)

Don't worry Bruce- you'll be fine. Although you aren't the only one to think prices on keywords have been bid to the moon lately- last week eBay said the whole paid search industry was experiencing a pricing bubble.

But hey- I'm pretty sure that bubbles never pop.

February 28, 2005 | Permalink | Comments (0) | TrackBack (0)

February 24, 2005

GOOG downgraded- stock collapsing in the pre-market

Ooops.

If I had bought my morning coffee yet, I'd write something more profound. As I am still asleep, I think the owned kid says what words can't.

February 24, 2005 | Permalink | Comments (2) | TrackBack (0)

February 23, 2005

Google results at the mercy of Search Engine Optimizers

In the beginning, Google was incredible.

Sergey and Larry's "popularity" algorithm almost worked like magic, giving results that were more relevant than any other search engine on the planet. It was a stroke of genius, really- basing the page rank of websites on their popularity: if a certain site appeared in the links of lots of other people's websites, that meant the Google engine would deduce that you should probably pay attention to what everyone else was paying attention to.

The only problem was that this magical formula was ripe for exploitation. Link farms (dummy sites with no purpose other than to trick Google's spiders with hundreds of links) and metatag abuse were rampant. Some of the most obvious of those cheaters were quickly filtered out, but the fact remains that there is an entire industry of well-paid consultants and programmers with the sole job of fooling Google into putting their clients into the first page of search results for any given term. Studies show that the vast majority of people never scroll past the first page of any search query, so to get eyeballs and make sales you've got a huge financial incentive to make sure you appear on that first page.

It has gotten so bad that most people I know who are serious net users have switched to other search engines for daily use- it literally is the case that the first two or three pages of any term searched on Google contain nothing but gamed rankings of various online vendors, especially if the term in question is an item or service that can be sold.

A new study came out today illustrating just how bad things have gotten- more than three quarters of companies listed in the FTSE-100 (British equivalent of the Dow Jones index) are almost completely absent from Google's listings. Search engine optimization specialists have gamed Google's algorithms so heavily that almost every result is totally irrelevant, at least in the United Kingdom. Of course, the results are just as irrelevant in the US- we just don't have an offical study to prove it yet.

February 23, 2005 | Permalink | Comments (1) | TrackBack (0)

February 21, 2005

What a long, strange trip it has been

A moment of silence for a dear departed soul: Hunter Stockton Thompson.

For those out there who knew what he was getting at, no words are necessary.

For everyone else, you probably have no idea what I'm talking about, I'm sure...but don't worry- you will some day.

February 21, 2005 | Permalink | Comments (0) | TrackBack (0)

February 20, 2005

Google branching out into the adware business?

I just knew Google's new Autolink feature looked familiar. It performs the exact same actions as a popular piece of spyware/adware from 2003 called "TopText"

Google understands that most users don't even recognize that Adsense ads are actually advertisements. This is the entire key to their business, as we have previously explained. All of the contextual matching, all of the font and color matching, all of the barely visible and nonsensical "Ads by Goooooogle" text instead of "THIS IS A PAID ADVERTISEMENT" serve one purpose- to fool users into thinking that the text ads are part of the website itself.

Before you say "But I'm supah-smaaaht, I can always recognize advertisements" you might want to take a look at this recent study that shows less than 18 percent of all internet users are able to spot paid ads on search engines. Can you imagine how easily they'll be fooled when Autolink starts modifiying the actual HTML?

When an article in the Wall Street Journal suddenly has random words underlined that send Joe User to the highest bidder, the final step in profit-driven content rape will have been reached. Google will have suceeded in cutting out their biggest expense- paying those pesky content producers part of the money they get from advertisers. Congrats, Google!

February 20, 2005 | Permalink | Comments (1) | TrackBack (0)

February 18, 2005

Don't be evil ? Did we actually say that? No...... really?

UPDATE: Apparently, the Google manager behind all of this is Jeff Reynar, the same guy who invented Smart Tags when he worked at Microsoft!

Billy must be tipping his hat in admiration to the folks at Google for getting away with something he never could. (Oh, he tried, he just didn't get away with it)

Dan Gillmore wrote today that Google is starting to act in ways that are reminiscent of our favorite monopolist with their new Autolink feature. And he's right.

Google has decided that they are now going to link advertisements to any word on any webpage that they wish, as long as the user is running the Google toolbar. For example, if I used the word "viagra" in this article, a user surfing this page would find that the word appears underlined with a hotlink like so: viagra Clicking that word would send you to the website of any vendor who had paid Google to advertise based on that word. The profit potential of this gambit entirely depends upon the number of people who have installed the Google toolbar, which at last count numbered in the millions.

For the techies out there, this is conclusive proof that the Google toolbar is capable of performing full http socket intercepts and parsing the datastream. Big brother, anyone?

Whether or not your website is a member of the Adsense program makes no difference- Google is now going to collect ad revenue on every webpage on earth. And they aren't going to pay the website owners anything. Zilch. Nada.

The interesting thing is that Microsoft tried to do the exact same thing some time ago, back when it was called Smart Tags, but was shouted down by privacy groups and web netizens in general. They said it would give Microsoft an almost instant-monopoly of the online ad market. But I guess as long as Google gets that monopoly- it's ok.

All hail our new benevolent dictators Larry and Sergey!

February 18, 2005 | Permalink | Comments (9) | TrackBack (0)

February 14, 2005

Valentine's day massacre? Not likely.

For anyone who has been involved with a public company, you know there's a giant secret that never gets much air in the media.

Employees of Google have been approached by various brokerages with offers to participate in "non-public" insider share sales. It's basically an agreement between an insider and a private purchaser wherein they sell their shares in an off-market transaction, which doesnt show up on any NASDAQ official statistics. This works great as long as there are enough private buyers willing to absorb the shares of insiders, which may or may not be the case with Google. The main benefit is that these sales don't have any impact on the NASDAQ share price since they are done outside of normal regulatory conventions.

I've gotten email tips that confirm brokerages have been coming out of the woodwork offering these sort of deals to Google employees, many of whom are not required to report the transactions to anybody. Falling underneath the radar of the five percent ownership rule, as well as the gang of folks who didn't have to officially "purchase" shares due to the options fiasco that occurred last year, this leaves milions upon millions of shares that are basically undetectible by any public examination.

In short, I don't expect much of anything at all to happen with Google's share price today. This "event" has been orchestrated months ago, to keep the public sheep.. er, investors, from getting scared. One thing I can predict with absolute certainty: tomorrow you will have scores of Wall Street analysts on CNBC and the newswires saying that it's safe for investors to jump back into GOOG now that the expiration date has passed and the stock hasn't collapsed.

February 14, 2005 | Permalink | Comments (0) | TrackBack (0)

February 11, 2005

Please ignore the elephant in the middle of the room

Click fraud- one of this site's most popular topics. No search engine on earth has made public any sort of official results about the extent of "click fraud" due to two reasons:

1) If the truth was known, advertisers would flee in terror with their ad dollars

2) The search engines don't have a fucking clue as to click fraud's extent because they can't really detect it

An article came out today from the Associated Press with the current best guess of 20 percent of all pay-per-click advertising revenue being completely fraudulent. Some analysts suspect the real number may be closer to 50 percent, but the scary thing is that nobody knows for sure. Since this represents around 98 percent of Google's current revenue, this will remain a huge wildcard until they address the issue with something other than the standard disclaimer: "We have teams of Phds working on the subject, so don't worry your little wallets.. i mean heads"

In the article a small business owner, Tammy Harrison, says that bogus clicks have cost her over $100,000 this year alone. "Click fraud has gotten out of control" she complains.

What's her problem? Google gives free meals and massages to all their employees! Doesn't she understand the new paradigm?

Synergize, Tammy, synergize!

February 11, 2005 | Permalink | Comments (3) | TrackBack (0)

February 10, 2005

Step right up! Prepare to be dazzled!

Google's first analyst meeting with Wall Street honchos yesterday didn't turn out exactly how people had expected. Instead of giving any sort of financial update or forecasts, everyone got to see Eric Schmidt (the CEO) dance around for an hour without saying anything. Usually these sort of meetings are presented by a company's Chief Financial Officer, but Google is far too hip and trendy to follow those stodgy traditions!

But look on the bright side- Google tried to give away a free scooter to one of the analysts in a raffle drawing. No, I am not making this up, folks.

In what was perhaps the first recorded instance in history of a stock analyst refusing a bribe, the scooter was declined. (whether it was to avoid the appearance of conflict of interest, or because the analyst was pissed at the crappy gift- you decide!)

February 10, 2005 | Permalink | Comments (2) | TrackBack (0)

February 09, 2005

Google fires employee over private Blog

Don't be evil? At least, in public, that's the face that Google would like everyone to believe.

Does that include treating all new employees like sheep to be sheared if they dare speak of how things *really* are at the office?

Apparently so. Mark Jen has officially been fired over his blog.

February 09, 2005 | Permalink | Comments (1) | TrackBack (1)

February 04, 2005

Wanna buy a knockoff handbag, cheap?

In a stunning blow to Google's core business model, today the French courts declared that Google has finally gone too far. The Paris District Court officially charged GOOG with trademark counterfeiting, unfair competition and misleading advertising.

Apparently Google was making quite a bit of cash selling ad links to counterfeiters. Anyone who searched for the term "Louis Vuitton" would get a screenfull of ads directing them to dozens of counterfeit handbag sellers. The best part is that Google knew exactly what they were doing because web surfers have been recently proven to be completely unable to distinguish Google's paid text ads from actual search results.

February 04, 2005 | Permalink | Comments (1)

February 03, 2005

Say two thousand zero zero party over, oops out of time

After releasing earnings that beat lowered analyst expectations, Google's stock at one point was up over 20 points afterhours. While it has settled down a bit since then, the price is still staggeringly high by any measure.

For those of you with no long-term memory (a recurring theme on this site, if you hadn't noticed), seeing a dot.com stock go up 50 or even 60 points at a pop was an everyday occurance before the internet bubble burst in 2000. Stocks with no revenue and no profits were routinely trading for 300 dollars a share or more. The stock price had absolutely no basis to any sort of reality. Until the music stopped, that is.

Some professional money managers are starting to get worried, though. In the New Zealand Herald, Brian Barish comments that "looking at Google from a value orientation is about impossible."

That's putting it mildly.

(Update: as of Feb 10, GOOG stock has fallen 30 points from the high reached just after earnings were announced.)

February 03, 2005 | Permalink | Comments (3)

January 31, 2005

Google spins up another business idea

As this site stated last week, it is becoming clear that in an attempt to keep their lofty stock inflated, Google has been forced to branch into entirely new business sectors on a near-daily basis. Well today is no exception, as Google has officially entered the domain name registration biz.

January 31, 2005 | Permalink | Comments (0)

January 27, 2005

Cramer can't even say it with a straight face anymore...

Earlier today, Jim Cramer of TheStreet.com came out pimping for Google's stock like there was no tomorrow. Given his utterly atrocious track record in predicting the markets, one has to wonder what exactly it would take to get fired as a CNBC commentator or stock-touting "analyst."

I can only surmise it would require a convertible headed towards Vegas at 90 mph, a gun, Tobey Maguire, plenty of amyl nitrate poppers and a half-empty bottle of bourbon.

No point in mentioning the bats, though- the poor bastard will see them soon enough.

For those of you with no long-term memory, I thought today I'd dig up a link to that infamous article from February 29, 2000, where Cramer listed his personal choices for the ten stocks everyone should sink all their money into. Five years later, nearly all of those stocks have either gone bankrupt or fallen 95%.

With cheerleaders like Cramer on Google's team, who needs enemies?

January 27, 2005 | Permalink | Comments (3)

January 25, 2005

It slices.. It dices.. It has 1001 uses!

Following the playbook from Amazon.com during the height of the dot com bubble, Google has decided the best way to justify a ridiculously overvalued stock price is to keep 'em guessing with regards to possible future revenue sources.

Back in the day, Amazon would gushingly announce entry into various new categories of e-tailing, such as home electronics, gardening tools, cookware, clothing for children, etc etc. Each announcement was covered by analysts and reporters with glowing agreement that these new categories would certainly be able to justify Amazon's sky-high P/E ratio. It kept working, up until the day it didnt.

Not to be outdone, in the last week alone, Google has been rumored to be entering the telephone market, been rumored to be entering the internet browser market, officially entered the photo-editing market, and last but not least, entered the video search market. That last one is a bit of a misnomer, since they don't actually search video, they merely search the closed-captioning text that appears with some broadcasts. But "video search" sounds much more impressive, so that's what everyone is reporting.

Considering Google's stock has dropped nearly 27 points in the same period as all of these announcements, it doesn't appear that anyone is fooled this time around.

But hey, I hear they threw a really bitchin' ski party in Lake Tahoe for 3000 employees last week, so at least they've got their priorities straight!

Anyone up for a game of foosball?

January 25, 2005 | Permalink | Comments (0)

January 24, 2005

There's a sucker born every minute

P.T. Barnum would be proud.

In previous months this site has proposed the idea that the fundamental reason text ads have such a high clickthrough rate (as opposed to standard graphical banner ads) is that most people simply don't recognize text ads as advertisements. Most people assume that text appearing on a website in a matching font and style are just part of the website itself.

People tend to trust unbiased sources more than obvious pitches from vendors-just as you'd trust your father's recommendation for a car dealership who gave him 30 years of honest service versus a random classified ad in the newspaper.

This "trust" model is what text ads base their entire revenue stream on. In fact, around a year ago, Google made changes to their adsense program that prohibited webmasters from using HTML tricks to make the "Ads by Google" line disappear. Websites had been abusing the power to make the Adsense ads appear to be integrated with the content of their website, and once the changes were made they were complaining about HUGE percentage drops of clickthroughs because they were no longer able to fool as many people into thinking the ads were actually content. Google has since backed off that tough policy and webmasters are free to select the shade and color of the ads so as to blend them in more convincingly with the surrounding website.

Well, the anecdotal evidence has finally been backed by empirical evidence. A new study shows that only 18 percent of websurfers are able to distinguish text ads from actual website content.

Google's only source of income has officially been shown to be a gigantic con job. The reason Adsense has been so successful is simply this: most surfers don't know those text links are paid advertisements.

A business built on deception might not be very long-lasting, methinks.

Not to worry though- GOOG is rumored to be going into the VOIP telephone business- I guess the mad dash to secure additional revenue streams has begun, no matter how absurd. Maybe they'll branch out into Google home mortgages, like General Motors did with DiTech?

January 24, 2005 | Permalink | Comments (3)

January 21, 2005

AOL kicks Google to the curb

Not that I've ever been a fan of AOL, but it does say something when the nation's largest ISP (around 22 million customers) decides that Google just can't cut it any longer when it comes to providing localized search. As of today AOL is going to be using search technology from a small Norwegian firm called "Fast"

Unsurprisingly, Steve Langdon (Google's PR flack) declined to comment. He was probably just busy like everyone else at Google doing their new Job #1: selling as much insider stock as they possibly can before the bottom falls out.

January 21, 2005 | Permalink | Comments (2)

January 20, 2005

France declares Google's business model c'est illegal

Reversing Google's streak of good luck when the Geico trademark infringement case went nowhere, the French courts today have stepped up to the plate and declared that Google broke the law when they sold advertising space based on trademarked names of other companies.

In this particular case, Le Meridien is a French hotel chain that was tired of seeing their competitor's ads pop up whenever anyone searched for their company name. For example, if you type "Pizza Hut" on Google, and Papa John's had paid Google a large enough bribe, (oops i mean ad budget) you'll get their ads instead. Nice work if you can get it, i guess. But at what point does a search engine stop being a search engine, and instead becomes a bought-and-paid-for obfuscator whoring itself out to anyone who promises to leave some cash on the nightstand?

The important thing to remember about this legal decision is that it establishes case law precedent for future disputes ANYONE may have with Google in France. This means that firms should be coming out of the woodwork over there pretty soon, now that courts have given them an almost certain win with any similar suits they might want to bring against 'da big G.

With numerous companies in the US currently suing Google for the same exact behavior, (including Geico, owned by Sergey and Larry's supposed idol Warren Buffett) you can be sure the fun is only beginning. Oh, did I forget to mention that Google makes over 98 percent of its revenue from this practice?

Good thing they haven't put all of their eggs in one basket, eh?

January 20, 2005 | Permalink | Comments (5)

January 18, 2005

Google's stock derails

We've been gone for a while, but now we're back!

Stay tuned!

January 18, 2005 | Permalink | Comments (19)