Google's Click Fraud Settlement Update

The Associated Press offers an update today on Google's proposed $90 million settlement to a click fraud class action lawsuit. While some advertisers seem prepared to accept Google's proposed advertising credits, others are shunning the settlement to move forward with their own suits against the company.

While the settlement has been reported to amount to $90 million, it's important to remember that $30 million of that will be going to the law firms that brought forth the suit. That leaves $60 million in advertising credits to be distributed at a rate of $4.50 for every $1000 spent with the firm.

For those that don't want to do the math, that amounts to less than half of one percent of an advertisers spending. With conservative click fraud estimates pegging the number closer to 15% and some putting the number as high as 40%, the AP article notes that Google could be getting away with anywhere from $1 billion to $5 billion in non-refunded fees.

On the other hand, if Google offered up a settlement that amounted to a more realistic 10% or 15% of advertising costs, they would effectively be admitting that the problem is a large one and would then give companies ammunition to use in future fights against the company.

Danny Sullivan has a nice round-up of other coverage of the settlement.