John Battelle's searchable: Joel on AdSense
Why wouldn't click fraud be a problem? If the internet is anything at all its the biggest petri dish of human folly that exists. The simple fact is that if there is a way to make money with a given system, then someone will try and figure out how to rip that system off.
CPC is a big money making machine and that guarantees it a spot in the radar of scam artists. Those people will always try and find new ways to beat the system and make a buck doing it.
So now that we are all reminded of human nature, lets see the parties involved here: advertisers, publishers and Google.
For many advertisers its a tough pill to swallow that they just paid Google $10,000 to drive 845 people to their site and 10 people "converted." So where to point the finger? Well it must be fraud! Why else would someone get to our site and not buy our solar powered flashlights? Its never the sites fault right? We spent $$$ to redesign our site and we have flash!! I could go on but you get the idea. I think that a big part of this issue is that advertisers are driving people to very bad websites and can't see the pink elephant in the room, nor do they want to see it.
So is fraud the answer here? Are all those 845 clicks real people? I think most of them are but there is a percentage that are not. What that mix is I don't know.
From the publishers point of view the more fraud the better. Keep clicking! Be it a person, a script, or some poor soul in India working for 3 cents a day. They collect checks and have no legal or fiscal responsibility to their user base or to the advertisers that appear on their sites. If there was fraud, they can just turn around to Google and say "Hey take care of this."
So now Google's point of view. Do we acknowledge this "click fraud" thing or push it off? They seem to be following the M.O. of our esteemed presidents. Deny it until someone has proof, then push blame somewhere else and maybe fire someone. Until there is proof of click fraud that Wall Street will pay any attention to, Google will not have to deal with that subject.
CPC can work well, I've seen it over an over but to deny the issue of click fraud is denying the bigger human nature issue here. There are people scamming Google right now, what will they do about that?