It was reported on Cnet.com that Google has addressed the concerns about click fraud in the online-ad industry; Google will be disclosing to advertisers the number of invalid clicks on their ad words campaign, in addition to the percent of invalid clicks representing the total clicks registered for each user’s account.

Click fraud can occur in two separate ways. First there are web site owners who subscribe to a Google service called ad sense, where relavent ads populate an area of the owners web site, and the site owner gets paid every time someone clicks on the ad. Click fraud occurs in this case when, a site owner clicks on ads on their site to increase their revenue. The other form of click fraud stems from ad words, which are those ads appearing on the right hand side of a Google search result page in the blue box. Advertisers pay a premium each time someone clicks on their ad, sending the user to the advertiser’s web site. Click fraud occurs in this case, when companies click on their competitors' ads to consume their advertising budgets. According to Google, when a user accidently double clicks on an ad, this is considered an invalid click and Google does not charge the advertiser.

A business product manager for Google stated, "Advertisers asked us for more transparency on this issue, … Until now advertisers haven't had a great deal of data to compare from their own accounts in order to be able to understand what Google is doing for them."

It has been reported by various industry analysts that click fraud account for as much as 20%, but not less than 14% of all online ad spend. It seems as though the only reason Google is going to start disclosing more information to its advertisers, is that they are concerned the level of distrust has risen to such a point that they will start to loose significant ad revenue from untrusting advertisers. Those advertisers surly will want to continue spending their marketing budget on a proven commodity such as search engine marketing, if they had a decent ROI. As such, they may put more of their budget into Yahoo, or MSN. Google can not let that happen, as they do not provide nearly as many alternative sources to generate revenue as the other two major players in the search industry.

It should also be pointed out that Google did make a $90 million dollar settlement offer to eliminate a suit pending against them by Lane's Gifts, et al for click fraud and over charging advertisers.

The above blog was written by Mike Goldstein, SEO Manager at Rock Coast Media.