“This agreement with Sun Microsystems is another important milestone in our strategy to secure broad-scale distribution for our search offering, enabling millions more people to experience the benefits of Live Search,” said Yusuf Mehdi, senior vice president of the Online Audience Business at Microsoft. “With the vast array of Java software-based Web applications that are downloaded every month, this deal will expose Live Search to millions more Internet users and drive increased volume for our search advertisers.”

Earlier this year, Microsoft reached a deal with HP to have the toolbar shipped on 2009 PCs.

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But Schmidt says that's not going to happen. He's happy at Google and he has no plans to go anywhere. He does intend to remain an advisor to Obama.

This is good news since Google likely needs Schmidt to stay put right now. Search advertisers, like many other companies, are bracing to see just how big of a hit they'll take during the tough economy.

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Now, Rep. Joe Barton (R-TX) has written a letter to Barnett expressing his concern. Barton's beef is with what he feels is Yahoo's inadequate response to questions regarding the deal.

Barton represents a district that includes Fort Worth as well as suburbs of Dallas. The area is home to many search advertisers. It's no surprise that Barton is raising concern on their behalf.

Google and Yahoo have tried to assure both the DOJ and advertisers that prices will not go up as a result of the deal, but fears remain. Both companies have said that advertisers set the pricing through the bidding process, but when you're thinking about bidding for a term on the top 2 search engines, it's understandable to think that prices will go up - even if Google and Yahoo do not set them higher.

What remains is uncertainty, which is not exactly comforting in a volatile economy.

Google has been doing the heavy lifting when it comes to defending the deal to the critics. So, it was about time we heard from Yahoo again on the deal.

But Decker started off with a sarcastic tone. Her first paragraph ended with:

Since the critics clearly don’t understand the deal and what it means for Yahoo!, Google, advertisers, and users, it’s time for some myth-busting.

Sue, if you want to win friends to your side, you shouldn't alienate these critics. Many of them are AdWords customers!

But Decker devolves even further by saying making her two points about what the deal does for Yahoo instead of making it about the customer:

• Yahoo! will use this agreement to help us become a stronger competitor in all aspects of online advertising; and
• Yahoo! is not exiting the sponsored search business. We plan to remain a strong player in sponsored search.

I know that Decker has probably been consumed with trying to save a flailing Yahoo. But the fact that she's going after this argument by defending the business aspirations of Yahoo might show why this company is struggling in the first place.

Companies succeed when they focus on the customer. But Yahoo is focused on stock prices and board preservation. This is not the way to win the hearts of search advertisers or investors.

Otherwise, Decker made points that Google has made. She says there will not be price setting between Yahoo and Google because advertisers set the prices through the bidding process. The price is related to the value which is based on demand.

Decker even played on Google's unofficial motto "Do no evil" by saying the partnership would be implemented through respect for the Hippocratic Oath "first, do no harm."

To be fair, Yahoo probably needs this deal in order to bring in some extra income. What they need to do what that income is invest in innovation that brings a better search experience to users. That's what the search industry needs right now. And it's the only way to truly compete with Google.

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To Fear or Not to Fear: That is the Question (About the Google-Yahoo Ad Deal)

Price comparison websites are big business in the UK and all the major industry players
advertise heavily on Google. Research by Resolution Foundation shows that 45% of UK adults used a comparison site to help them make a financial decision in the last year and that the price-comparison market is estimated to be growing at 30% a year.

That's why the launch of the new service comes at a critical time for Google and its financial services advertisers. Says Cowell, “Most big financial services websites are just coming to terms with a marked increase in their paid search advertising budgets due to the recent changes in Google’s trademark bidding policies, so Merchant Search could be rubbing salt into the wound.”

Sites such as Ebay have boycotted Google Adwords by withdrawing its adverting when Google attempted to encroach on PayPal’s territory. So, uprisings are not unheard of in the search arena.

That's why Cowell and the rest of the industry is waiting to see how the price comparisons companies react to the launch of Merchant Search.

In today’s SearchDay, “Microsoft Adds More Tools for Search Marketers,” we look at the adCenter Add-in for Excel and adExcellence accreditation program for search advertisers, and a new Webmaster Center for organic search optimizers.

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On content networks, such as Google AdSense and the Yahoo Publisher Network, the click fraud rate was 25.6 percent. That’s up from 21.9 percent for Q1 2007.

“A significant percentage of today’s click fraud traffic can be attributed to two growing areas of concern for search advertisers: traffic that comes from botnets and from parked domains or made-for-ad sites,” Tom Cuthbert, president and CEO of Click Forensics, said in a statement. “Advertisers running campaigns on content networks are especially vulnerable as they are increasingly targets of this growing pool of savvy fraudsters.”

Click Forensics’ numbers come from the Click Fraud Network, a group of publishers organized by Click Forensics to share PPC data from both large and small companies.

Click to read the rest of this post…

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The overall average click fraud rate was 15.8 percent for the second quarter of 2007. This was an increase from 14.1 percent in 2006 and 14.8 percent for the first quarter of 2007.

The average click fraud rate of PPC advertisements on search engine content networks, including Google AdSense and the Yahoo Publisher Network, was 25.6 percent. That is an increase from 21.9 percent for the first quarter 2007 and 19.2 percent for the fourth quarter of 2006.

There was twice as much traffic from botnets in the second quarter as there was in the first quarter, which was a significant factor in the increased click fraud rates.

In the second quarter the largest percentage of click fraud from outside the U.S. came from France (5.1 %), followed by China (3.2 %) and Australia (3%).

"We’re not surprised to see the industry average click fraud rate climb this quarter as a result of botnet activity," said Robert Hansen, CEO of SecTheory and one of the industry’s leading experts in online security threats.

"Our clients are well aware that botnet activity is on the rise and that botnets are being used for a variety of online fraud activities, including click fraud."

The FBI recently reported that botnets have compromised over 1 million U.S. computers. Their sophistication and growing numbers are making it more difficult for search engines to flag click fraud coming from these sources.

"Click fraud has become the new spam and it’s clearly a problem that is getting worse, not better," said Tom Cuthbert, president and CEO of Click Forensics, Inc.

"A significant percentage of today’s click fraud traffic can be attributed to two growing areas of concern for search advertisers – traffic that comes from botnets and from parked domains or made-for-ad sites. Advertisers running campaigns on content networks are especially vulnerable as they are increasingly targets of this growing pool of savvy fraudsters."

Click Fraud

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SEMDirector will use comScore’s qSearch data to measure search activity and provide analysis to the search advertising market. SEMDirector will use comScore’s data to enhance its marketing platform.

"SEMDirector’s innovative, software-based delivery platform for managing large scale paid and organic search campaigns is a great complement to the deep understanding comScore has amassed on the trends and performance of search marketing globally," said James Lamberti, SVP at comScore.

"Through SEMDirector, search advertisers can take advantage of qSearch information in the context of their day-to-day business decisions, as managed within the SEMDirector: Marketing Action Platform."

The two companies plan to co-sell each other’s solution to their customer base.

SEMDirector offers automated software for managing search marketing, pay-per-click advertising and organic search optimization of Web pages.

"The rich data available within comScore qSearch and our deep understanding of analytics and strategy in paid and organic search programs for large advertisers allow us to greatly improve the knowledge our clients can utilize to gain sustainable competitive advantage in search," commented Russ Mann, CEO of SEMDirector.

comScore SEMDirector

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