Well we have all heard of click fraud but we have a new term to deal with as of today.
According to the Wall Street Journal, Microsoft filed two lawsuits for “Click Laundering”, on Monday in federal court in Seattle against Eric C. Ralls and the company he founded, RedOrbit Inc., a Dallas science news and shopping site, plus 20 unnamed defendants (Johe Doe’s).
Microsoft claims RedOrbit engaged in “click laundering,” a term for making bogus clicks on third-party sites look like legitimate clicks on a publisher’s site, thus inflating ad revenue.
Microsoft also filed a similar suit against 20 unnamed “John Doe” defendants who allegedly committed click laundering through HelloMetro Inc., a network of online city guides based in Louisville, Ky. The company itself is not named as a defendant, and spokesman Clark Scott said the company did not engage in fraud and is cooperating fully with Microsoft.
Microsoft is seeking $250,000 in illicit profits and punitive damages.
Microsoft, says click laundering, is an offshoot of click fraud.
In the RedOrbit case, Microsoft says it discovered the alleged scheme after detecting a growing number of suspicious clicks from RedOrbit’s site over a two-week period starting in January 2009. The site had previously averaged 75 clicks a day, but the number spiked above 10,000 clicks per day, according to the complaint.
The journal writes that according to Microsoft, RedOrbit manufactured a large numbers of bogus clicks “”on shady sites known as parked domains—Web sites that are legal but exist only to display ads.””.
Microsoft says the clicks came from Bot-nets and from malware installed on PC’s.
While I certainly don’t condone click fraud or “click laundering”, I also don’t like Microsoft (remember they are going to take over Yahoo PPC program this year) throwing all parked domains under the same bus by calling them shady sites.
Microsoft is going to take over the management all of the traffic from domains parked at Yahoo sometime this year.
If I was a Yahoo parking partner I would be very nervous about the prospect of getting to bed with a company that refers Parking pages as shady.
I read the lawsuits and neither mention parked domains as far as I could tell. Perhaps something about how they relayed the info to the WSJ was misinterpreted? I’ll send the lawsuits over to you in a moment.
I didn’t see anything in the complaint about parked domains either. MSFT is pretty sue-happy considering there are protections in place to filter click-fraud on the other 2 top search networks. If it was legitimately direct navigation traffic I’d be concerned about their perspective of the search syndication landscape and hope that Yahoo folks are in charge of managing the third party publisher agreements as they’re the true veterans of the space.
The Complaint is quite vague, even most the defendants aren’t named.
However if you combine the suit with the quotes of the Microsoft Rep then it seems as if parked domains are involved and details will be coming out as the case develops.
ClickLaundering.com is parked!
Chip
At least its going to a Google rather than Yahoo feed
I suppose MSFT doesn’t want to give too many details on how it was carried out to prevent copycats. Or maybe it doesn’t exactly know.
Think the bigger issue is that Microsoft will soon be the second and only other player to Google in the domain parking space and they are saying that parked domains are shady.
Not a good sign
I guess the suspect pages could be serving up live content from RedOrbits pages via some sort of frame amd the frames would then show clicks as redorbit clicks to whomever they want. They mentioned that the ads were hidden.
Those words really show what he feels. Very snide comments.
“Websites that are legal but exist only to display ads.”
What he really means is that he can’t stand them and they should be illegal.
That’s really a ruthless remark and telling about how he and/or Microsoft feels about the domian industry.
Some clarification from Microsoft on this would be nice.
@ Tim – I actually think MSFT is a fan of domains. Perhaps this is just one guy’s opinion at the company. It might also have been taken out of context in the article.
It wouldn’t surprise me if a clueless PR hack within Microsoft actually did characterize parking pages as such. Microsoft is an incredibly inept and broken organization, all the way from their top management down to their mediocre products.
Point being, don’t necessarily attribute to malice what can be adequately explained by stupidity.
Yeah because we all know Google LOVES domainers.
Microsoft TOTALLY “gets” domains. Just look at gps.com with its Alexa ranking of 14,527,658, and its “No page ranking available” from Google.
I hit it a few months ago, and it was pointing to a Microsoft Silverlight conference or something equally unfathomable. Now it’s pointing to their wonderful “Streets and Trips” product. Don’t forget your laptop next time you go for a drive.
What a colossal waste.
Hello Mike,
Yes Microsoft is directly assaulting parked sites. Make no mistake about it. I have been advocating a search channel that is DOMAINER friendly in previous posts. We are formulating a plan to promote direct navigation and increase traffic payouts. The way things are trending, I would say there is an ever increasing need to turn the tables.
It may be just a matter of time before all parking will be cast with the same brush as cybersqwatters, is this coming? We think so !
Gratefully,
Jeff
I don’t get it, what am I missing? Are the parked pages or offending sites displaying Ads supplied by Microsoft? MHB u said it was a google feed?how has invalid clicks on a google feed caused damages to MS? Is this guy and 20 unnamed defendants part of the lucky few that get an ad feed from MS? I know it isn’t a big list of people who get a feed from MS so this has to be like a decent percentage of Microsoft’s partners
Hello Mike,
Hiring a legal team to assault Traffic sites is hardly a fumblebum manuever. It is a premeditated campaign volley over the Bow of all DOMAINERS. Its all about control of the Marketing and ad revenue streams. If these large players focused on serving the public instead of protecting their turf by working on scalability they could turn a better profit and quit picking on the direct search industry.
They cannot win the big war so they turn their wrath on perimeter players. It is the age old capitalism play, Get Big Then Block all Competition. The tides are changing slowly and in the next few years the big winners will be smaller more manueverable businesses. From small acorns grow mighty oaks.
Gratefully,
Jeff
How is this an assault on domainers?
It appears to be an assault on people organizing complex click fraud schemes (which are insanely common).
The intent of PPC ads is to deliver legitimate, filtered eyeballs to legitimate sellers of legitimate products. People who are getting clicks from bots or automated traffic are simple stealing… Period. Even domainers who’ve dabbled in stuff like click arb (particularly those who haven’t been to mindful as to the sources of their bought traffic), etc, are flirting with fire in this regard, IMO.
MSFT is out to pike a few click-fraudster heads, I can’t say as I blame them. Businesses want legitimate, filtered eyeballs, not click schemers.
We cannot rise to defend crooks, just because they happened to be using domains as the medium through which they perpetrated their frauds.
@LS Morgan
How is this NOT an assault on Domainers ? The broad brush open endedness of the acussations, branding all parked sites as questionable is the goal of this law suit. It is vague for calculated reasons so as to portray parking as illegal. The same tactics used to label all domainers as cyber Sqwatters is being used in a similar fashion to raise questions about parking.
Gratefully,
Jeff
Microsoft is not a good sign…for anything.