Surprise: Advertisers Win Money From Google For Over-Budget Clicks

from the didn't-see-that-coming dept

Back in 2005, we wrote about how Google was sued because AdWords users were being charged more than their “daily budgets” for ads on the site. The case initially got plenty of attention after pretty much all of the mainstream press reported that the Howard Stern listed as a plaintiff was “the Howard Stern” of radio fame — though, that was later disputed. Either way, the case itself (famous Howard Stern or not) was still interesting. Since advertisers pay based on clicks, and the price of the clicks isn’t always known until the click happens, the “daily budget” that any advertiser sets for ads is impossible to match exactly. Thus, there will be days when the daily budget is exceeded — but that wasn’t acceptable to those suing, who found the whole thing misleading. After a court refused (twice) to give summary judgment to Google, it looks like the company has decided to throw $20 million at the problem to make it go away via settlement (a decently large chunk, of course, goes to the class action lawyers who brought the suit). This is a bit of a surprise, since you would think Google has a pretty clear case, as the terms of its agreement with advertisers was pretty clear on what was going on — but perhaps Google thinks it’s smarter to just pay up and keep advertisers happy.

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Companies: google

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Comments on “Surprise: Advertisers Win Money From Google For Over-Budget Clicks”

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Adwords Advertiser says:

I believe Google’s policy is that they won’t exceed the daily budget by more than 10%, and there’s something about the total for the month (can’t remember the details on that right now). That seems somewhat reasonable, and may not sound like much, but take a $500/day budget and that extra $50/day adds up pretty quick, especially when they occasionally even go over that 10%.

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