It seems a few other people are starting to chime in on “the dirty little secret” about PPC: clickfraud.
Wired is running a piece that compares splogging to click fraud:
Other enterprising scammers manipulate the affiliate system by creating phony blogs – spam blogs, or splogs – that automatically generate content by continually copying bits from other Web sites, mixing in popular keywords, then signing up the resulting mélange as a Google or Yahoo! affiliate. By using software to link themselves repeatedly to well-known real blogs, splogs trick search engines into listing them high on their results list, thus generating traffic, which in turn generates ad clicks. When unsuspecting Internet searchers visit splogs, they end up clicking the ad links in a frustrated attempt to find some coherent text. Thousands of splogs exist, snarling the blogosphere – and the search engines that index it – in spam. Splogs are too profitable to be readily discouraged. According to RSS to Blog, a Brooklyn-based firm that sells automatic-blog software, sploggers can earn tens of thousands of dollars a month in PPC income, all without any human effort.
Obviously, I don’t think it’s fair to call sploggers scammers or to put them in the same boat as click fraud. If people click an ad “out of frustration,” they’ still have just as good a chance to buy as anyone else. You’re not defrauding the surfer or the business owner – so how are they scammers?
I know Wired needs to break it down for a wider audience, but I think the “scammer” characterization is a blemish on an otherwise excellent click fraud article.

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December 30th, 2005
QuadsZilla
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the real question is the placeholder ad sites for domains. i wouldnt want to be paying at all for traffic from these domains. but, it seems that by tracking conversion rates google might be to adjust the money domain squatters make and the lower the advertiser’s cost.
I read this article too, and was about to make a post about it. I thought they writer did a pretty shitty job. But I could really care less. I’m more than happy to have some mainstream journalist say the sky is falling when real money is being made.
Adsense works because its traffic. People call it clicks, but its really traffic — highly targetted traffic. Yes, some advertisers aren’t watching their ROI. Yes, some advertisers aren’t using conversion tracking which helps Google’s smart pricing. But, there are plenty that are and are making good money off of all this targetted traffic, and the people not tracking their ROI usually also the ones that aren’t even optimizing their ad copy for optimal clickthroughs eithers. They end up on the bottom, get fewer clicks, and pay more.
Interesting point. But it’s kind of depressing to think that people make money off frustrating people into clicking on something, anything, to get away from the splog they’ve found themselves on.
LOL, this is toooo funny. Seriously, think about it. The guy is saying that because the information is located on a “splog” it is invalid information and frustrates the surfer into clicking away. BUT, if the same surfer comes across the same info on a non-splog site, it is A OK! So if I go to a splog site that has an article/review on free cell phones, its bad/invalid info that no one wants to read, but if I go to Amazon and get the same article, its valid information that everyone wants to read? Are all these news sites out there that syndicate from AP invalid sites? They must be since I can go to the AP site and read the original source.
Besides making huge bucks from spam blogs is a myth.