Is it me or is everyone else stupid?

I have a friend who works in Internet networks, data streams and all that malarkey. Very successful guy, works with all the big banks and search engines etc. His business tests the infrastructure and network capacity for the likes of HSBC, Ebay, Yahoo, Google… You can imagine the list. Recently he was showing me some of his hardware wizardry that has the ability to open millions of concurrent connections to web sites, perform any number of random actions on the site and do so from any number of spoofed / random IP addresses. In short they can send millions of fake visitors to your site and act like real visitors. They will do anything and mirror real user behavior identically except, of course, go on to actually “buy” something. Impossible to detect and impossible to stop. The likes of HSBC and Yahoo employ this guy to test their networks ability to cope with data flooding and denial of service attacks. We discussed what effect something like this bit of kit and his company could do to the PPC market.. [Naivety alarm going off yet? ]. He was amazed that PPC even still existed and was very confident he would be able to fool even the best of fraud filters. I met him actually on the train whilst I was enroute to see another friend of mine who works at Miva. Mentioning the conversation I just had on the train to the Miva folk and how I was [wink] going to use it to generate some substantial revenue noticeably chilled the room by at least a degree or two. “Oh, please dont do that..” i think went the reply.

Anyway,  another friend is one of those long forgotten arbitragers. Still doing it ironically enough. He tells me of an interesting experience he’s been having with Marchex recently. By all accounts he was previously making good money buying traffic through their network and monetizing it elsewhere. He says that previously he had little concern that over 95% of his traffic (and when i say traffic, hes spending over $1000 a day) had been coming from just 2 or 3 sites that all seemed to owned by the same person. Previously this was never a big deal for him because click throughs held up ok and he was making a tidy profit. The recent end to (shall we say) traditional PPC arbitrage has however sent him kicking and screaming into the PPA market. And thats where things have gotten a whole lot tougher for him. In the very least because he now has to have an interest and been forced to take ownership of the legitimacy of the traffic hes been buying. Some further research into these referring sites [and I have no problem in naming them, searchforklifts.com searchtinnitus.com and searchnorco.com] revealed that these sites (for want of a more derogative term) are all relatively new domains with no presence with the  major search engines. Where then they get this monumental amount of traffic to pass on is anyones guess but, in the very least the traffic was suspicious enough in order to ask for some help or a refund from marchex. He says he contacted Marchex about blocking these referrers and their reply was simply that they couldn’t do it but would, in their words, “look into it because they take fraud very seriously”. Yeah right. A month or so on and apparently he was still getting the traffic from these referrers and the owner is still one of marchexs’ partners. He says he’s sent them the log files and a huge body of evidence that clearly shows that Mr Search Forklift is sending him only fraudulent traffic. In one instance apparently someone from Bolton in the UK searched via SearchTinnitus.com (hmm, ok) for “new york accountants”. The likelihood of such an event happening is something Im sure you can fathom out for yourself. Ironically, he says, one of the factors mentioned in his report to marchex was that all the referring sites all appeared to be owned by the same person (some ddaysearch.com company). Aside from them not banning this guy he says he checked the whois of these sites a week or two later and all the whois details had been changed to [enter made up/random new ownership details here]. My friend joked that marchex, instead of kicking this person, probably sent him a heads up email saying that people were onto him. Either that or these sites are actually owned by marchex themselves…….hahahahhaha…….wait a minute..!

Looking at the greater picture prompted me into writing this post. I mean, from the scammer sending click farm traffic from something akin to the machine I mentioned in paragraph one, right up to just short of the $2 a click paying advertiser, until your revenue is impacted, no one, including parking companies, domainers and root feed providers were ever seriously bothered about stopping the fraud – simply because provided you made a buck, why was it your concern?

Full circle, and back on topic, multiply my friends case by thousands or even tens of thousands of times and you can see why PPC arbitrage came to an abrupt end. Some people are inherently greedy. Instead of buying keywords from legitimate sources and landing them on contextual pages, people bought junk traffic from sources such as marchex and landed them on a loosely connected page with the highest known bidded keywords – and not even the slightest bit of compassion for the dear old top level advertiser.

Domainers are inherently lazy, including the so-called experts who by chance got in there first and grabbed all the goodies. They, and the newer guys, simply found domaining because they wanted something that made money and involved no effort.  I’ll note at this point that all this is fine with me because i’m one of them. Their (our) problem however now comes because of this collective laziness and the squeeze that Google and Yahoo are now able to exert thanks to the imbalance of power that now exists. Google et al got busy owning the traffic and becoming indispensable for end users and domainers sat about simply looking for the angles. When Google needed domainer traffic they made no waves. Now they don’t need us they squeeze and offer advertisers the option to opt out. Where will undeveloped domains be when Google finally says goodbye?

The death of arbitrage means what? Domainers, like my friend, need to find another source of income generation. Will your common or garden domainer become a publisher and build out unique and compelling sites that offer as much to the visitor as is does to their own revenue, or will the forums be full of folk asking for where the next angle is to be found?