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I wrote quite a bit here in other comments, then I read some more and looked closer at the Kalkis-Research site. Please if you are a journalist and are going to

by AJ007 10y ago

I wrote quite a bit here in other comments, then I read some more and looked closer at the Kalkis-Research site. Please if you are a journalist and are going to link to this article, take a closer look at the writers. Is this even a real site? a) Only the 3 posts about Google are free. The other articles have very short descriptions and say you can buy them for €10,000. The thumbnail image accompanying the buy link is the same in all. They may not even exist. b) For all the details and charts in the Google pieces, they say "BEARISH -70%" but have absolutely no math or estimation about how they came to that conclusion. c) The authors are pointing out fraud largely outside of Google's traffic ecosystem -- ad exchanges, content recommendation ad networks -- but some how Google is the company that will lose half of its value. They couldn't be bothered to look at other public adtech companies? e) What they outline definitely with regards to worthless ads being sold is definitely real, occurring, and I'm not contesting that.

davemel37 10y ago
Whats truly ironic about this, is that this is the exact type of site that the site is railing against. They probably buy native ads on sites like Forbes, just trying to sell you an expensive infoproduct. (No wonder the author knows so much about this rampant problem :) I did notice that the writing came off as rather amateurish. It was a little too aggressive and salesy to feel legit. Edit: to & too
- kalkisresearch 10y ago
  You can check our stats on Alexa for incoming traffic, we don't buy anything. HackerNews is actually our main source, given the nature of articles that are free. I actually wanted to buy some traffic from OutBrain to see how it works, but then changed my mind precisely for this reason: not to pollute our footprint. We don't rally against websites that buy traffic to sell a product, especially something of higher quality. That's how advertising works, and it finances the whole Web. We're rallying against websites that bring nothing to the table, who spend longer on the title of the article than on the content, who circumvent the spirit of the rules to take the fast buck. As or the writing, we're all beginners at some point, give us time!
  - davemel37 10y ago
    > You can check our stats on Alexa for incoming traffic, we don't buy anything. Why would I use an unreliable public source of data if I have you right here. How about sharing some screenshots from your Google Analytics account?
  - powera 10y ago
    J'accuse! I still agree with the top thread that this isn't a "real" site, and speculate that it's just trying to drive PageRank to the long list of "spammy" sites linked multiple times in the article (via Hacker News).
  - pg_is_a_butt 10y ago
    advertising finances the whole Web? the WHOLE Web? didn't you get the new style guide? it's web now. i've been developing for it since 1995. advertising was NEVER part of the equation. i've made millions. you're an idiot. go spam your bullshit to some other sucker, lady.
kalkisresearch 10y ago
We're detailing the -70% in our first piece, it's based on the assumption of a 30% reduction in profits (so a 10%-15% fall in revenue, especially now that Alphabet's moonshots are eating up more & more of ad revenue from Google), which would lead to a repricing of the stock from "growth" to "value", and thus a P/E of 15 instead of 30. Fraud is part of Google. Spider.io discovered bot clicks on Youtube ads, which we mention. Not long ago, news came out that a botnet had infected AdSense for Search (http://marketingland.com/botnet-hijacks-search-results-siphon-google-adsense-search-revenue-177468 http://marketingland.com/botnet-hijacks-search-results-sipho...), so the actual google.com ad real estate that's considered the best in the world. No one is safe. We are new and we do exist. You can check our profiles on LinkedIn, the names are real & all. If you drop us a line by email, we'll gladly answer. You must also aknowledge that every piece needs substantial amounts of work, so someone real has to actually put in all the manhours. Notwithstanding the technology that's behind the charts. The posts on ad tech are free because we need to make a name for ourselves. The thumbnails suck because we overlooked it, focusing on everything else, thanks for pointing that out :) Cheers
- Guvante 10y ago
  So a 10-15% fall in revenue due to fraud leads to a 70% reduction in price?
- shostack 10y ago
  And where have you factored in the attempts Google makes to stamp out fraud, such as by refunding clicks they identify as fraudulent? [1] https://support.google.com/adwords/answer/42995?hl=en https://support.google.com/adwords/answer/42995?hl=en
  - deleted 10y ago
    [deleted]
- pellucide 10y ago
  Of the -70%, the biggest drop comes from the assumption that PE is going down to 15 from 30. That in itself is such a big assumption. Other arguments you spell out are valid, but does not justify the PE adjustment.
shostack 10y ago
Thank you for bringing some sanity to this discussion. The article should probably be flagged and pulled. Just read their About page--no details whatsoever and their methodology appears to be looking at Google Trends and the news. As a senior buy-side ad guy who has been in the space for a long time, here's my $.02 for what it is worth: - Click/impression/view fraud are big problems. Viewability solutions are still nascent, but improving. Google and Facebook are both fairly uniquely positioned (due to their data advantages) to continue getting better at cleaning things up. - People who think Google in particular is interested in perpetuating ad fraud aren't thinking things through to conclusion. The reason advertisers like myself spend as much as we do is because from what we can see in the data, it is profitable. Display is arguably less measurable (yada yada attribution yada), but Google is fiercely protective of their ad quality. Being recognized as a source of quality traffic that drives profit is Google's moat. If they could instantly kill all fraudulent traffic they would do it in a heartbeat because they know it would mean even more spend from advertisers who find them to be even more profitable. This is of greater importance now moreso than ever before with the rise of FB and FB's gains on the mobile advertising front. - There is a lot of thrashing and consolidation occurring in the display ecosystem. There is a major shift that has been in the making for years where advertisers are focusing more and more on "audiences" vs. "placements." Thus, whomever has the better audience data will be better positioned. Google has significantly better audience data than most ad networks and exchanges out there. A lot of the highest quality data is 1st party data living in someone's DMP or CRM, and Google has opened up tools for onboarding those audiences much like FB has (yay lookalike targeting!). Not that they didn't know who people were already. - The sell-side has significant pressure from the buy-side to clean up their act. Unless they are doing some sketchy arbitrage, 99% of ad buyers want to stamp out fraudulent traffic. Publishers who can't survive without it are not long for this world. Ultimately there are significant interests and dollars behind killing fraud. - Ad fraud will always exist in some form. That's why it is a number's game as well as a game of whack-a-mole. But yes, back to the original point--let's please not read too much into this...ahem..."well-sourced research."
- malchow 10y ago
  Coowner of a sell-side firm. I agree with everything shostack has said.

by AJ007 10y ago

davemel37 10y ago

Whats truly ironic about this, is that this is the exact type of site that the site is railing against. They probably buy native ads on sites like Forbes, just trying to sell you an expensive infoproduct. (No wonder the author knows so much about this rampant problem :) I did notice that the writing came off as rather amateurish. It was a little too aggressive and salesy to feel legit. Edit: to & too

kalkisresearch 10y ago
You can check our stats on Alexa for incoming traffic, we don't buy anything. HackerNews is actually our main source, given the nature of articles that are free. I actually wanted to buy some traffic from OutBrain to see how it works, but then changed my mind precisely for this reason: not to pollute our footprint. We don't rally against websites that buy traffic to sell a product, especially something of higher quality. That's how advertising works, and it finances the whole Web. We're rallying against websites that bring nothing to the table, who spend longer on the title of the article than on the content, who circumvent the spirit of the rules to take the fast buck. As or the writing, we're all beginners at some point, give us time!
- davemel37 10y ago
  > You can check our stats on Alexa for incoming traffic, we don't buy anything. Why would I use an unreliable public source of data if I have you right here. How about sharing some screenshots from your Google Analytics account?
- powera 10y ago
  J'accuse! I still agree with the top thread that this isn't a "real" site, and speculate that it's just trying to drive PageRank to the long list of "spammy" sites linked multiple times in the article (via Hacker News).
- pg_is_a_butt 10y ago
  advertising finances the whole Web? the WHOLE Web? didn't you get the new style guide? it's web now. i've been developing for it since 1995. advertising was NEVER part of the equation. i've made millions. you're an idiot. go spam your bullshit to some other sucker, lady.

kalkisresearch 10y ago

We're detailing the -70% in our first piece, it's based on the assumption of a 30% reduction in profits (so a 10%-15% fall in revenue, especially now that Alphabet's moonshots are eating up more & more of ad revenue from Google), which would lead to a repricing of the stock from "growth" to "value", and thus a P/E of 15 instead of 30. Fraud is part of Google. Spider.io discovered bot clicks on Youtube ads, which we mention. Not long ago, news came out that a botnet had infected AdSense for Search (http://marketingland.com/botnet-hijacks-search-results-siphon-google-adsense-search-revenue-177468 http://marketingland.com/botnet-hijacks-search-results-sipho...), so the actual google.com ad real estate that's considered the best in the world. No one is safe. We are new and we do exist. You can check our profiles on LinkedIn, the names are real & all. If you drop us a line by email, we'll gladly answer. You must also aknowledge that every piece needs substantial amounts of work, so someone real has to actually put in all the manhours. Notwithstanding the technology that's behind the charts. The posts on ad tech are free because we need to make a name for ourselves. The thumbnails suck because we overlooked it, focusing on everything else, thanks for pointing that out :) Cheers

Guvante 10y ago
So a 10-15% fall in revenue due to fraud leads to a 70% reduction in price?
shostack 10y ago
And where have you factored in the attempts Google makes to stamp out fraud, such as by refunding clicks they identify as fraudulent? [1] https://support.google.com/adwords/answer/42995?hl=en https://support.google.com/adwords/answer/42995?hl=en
- deleted 10y ago
  [deleted]
pellucide 10y ago
Of the -70%, the biggest drop comes from the assumption that PE is going down to 15 from 30. That in itself is such a big assumption. Other arguments you spell out are valid, but does not justify the PE adjustment.

shostack 10y ago

Thank you for bringing some sanity to this discussion. The article should probably be flagged and pulled. Just read their About page--no details whatsoever and their methodology appears to be looking at Google Trends and the news. As a senior buy-side ad guy who has been in the space for a long time, here's my $.02 for what it is worth: - Click/impression/view fraud are big problems. Viewability solutions are still nascent, but improving. Google and Facebook are both fairly uniquely positioned (due to their data advantages) to continue getting better at cleaning things up. - People who think Google in particular is interested in perpetuating ad fraud aren't thinking things through to conclusion. The reason advertisers like myself spend as much as we do is because from what we can see in the data, it is profitable. Display is arguably less measurable (yada yada attribution yada), but Google is fiercely protective of their ad quality. Being recognized as a source of quality traffic that drives profit is Google's moat. If they could instantly kill all fraudulent traffic they would do it in a heartbeat because they know it would mean even more spend from advertisers who find them to be even more profitable. This is of greater importance now moreso than ever before with the rise of FB and FB's gains on the mobile advertising front. - There is a lot of thrashing and consolidation occurring in the display ecosystem. There is a major shift that has been in the making for years where advertisers are focusing more and more on "audiences" vs. "placements." Thus, whomever has the better audience data will be better positioned. Google has significantly better audience data than most ad networks and exchanges out there. A lot of the highest quality data is 1st party data living in someone's DMP or CRM, and Google has opened up tools for onboarding those audiences much like FB has (yay lookalike targeting!). Not that they didn't know who people were already. - The sell-side has significant pressure from the buy-side to clean up their act. Unless they are doing some sketchy arbitrage, 99% of ad buyers want to stamp out fraudulent traffic. Publishers who can't survive without it are not long for this world. Ultimately there are significant interests and dollars behind killing fraud. - Ad fraud will always exist in some form. That's why it is a number's game as well as a game of whack-a-mole. But yes, back to the original point--let's please not read too much into this...ahem..."well-sourced research."

malchow 10y ago
Coowner of a sell-side firm. I agree with everything shostack has said.