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nytimes.com
nytimes.com
It is a bunch of scraped content, with ads around it. I don't see any additional value provided by sourcetool and I definitely don't believe the search engine argument as search engines generally add value by at least ranking pages somehow, there doesn't appear to be any logical order to how the pages are ranked more than when they appeared in the sourcetool database.
Some pages are nothing more than a series of keywords with ads around it, here's a perfect example chosen at random, I landed on a page for a business called "Sundeal", nothing but keywords.
The "Brief Description" are the exact words for the title tag of Sundeal's homepage, all other content (that is not part of the standard sourcetool layout) is simply the keywords meta repeated twice.
Even looking at the copyright notice down the bottom of the page "Copyright © 2005-06" makes it hard to believe this is in any way, shape or form a professional Internet Business.
I'd almost be inclined to say this article was paid placement itself.
Mod me down for those who don't agree, but I hold nothing but contempt for this sourcetool site.
I don't agree with this, I think Google has every right to provide it's main customers (searchers) the best possible product that they can. If anything, removing sites like these actually cut into Google's profits.
I have no problem with directories that are trying to drive legitimate, organic traffic to their sites, nor do I have a problem with any kind of web directory - I think that anyone who is adding value to the net should be commended.
I just think that if their whole reason for existence is to convert inbound adwords clicks into outbound adsense clicks by using scraped content, how can that possibly be valuable?
Most people here could easily replicate this site in the space of an afternoon and have the content up within days - grab an RDF dump from DMOZ, insert those URL's into any off the shelf spider and capture meta data from those pages and mash it up = instant spam site, does it add value? Most definitely not.
This case isn't nearly as bad as many arbitrage cases out there, and I would argue that even true arbitrage is healthy for the market, identifying and exploiting inefficiencies in the ad market and correcting them (and who's to say you can't make some money doing that?)
Example of 'helpful/legit' arbitrage: you buy from AdWords the keyword "mortgage" and then geo target your ads to only customers in California, sending them to a page with AdSense ads for the keyword "California mortgage" which pays higher than the national/non geo-specific term.
The problem with this is Google wants both the 'mortgage' term AND the "California mortgage' term and objects to you profiting from their advertisers over paying.
People were clicking on his Adwords ads (which would have to be properly descriptive - due to Google's policies) out of choice and were then browsing the guy's site before some of them were clicking on Adsense ads (again, properly described and out of choice).
If someone didn't like the sound of an ad, why would they click on it? They were clicking on the ads, and short of being forced at gunpoint, they obviously "wanted" to click on them.
This site was exploiting a difference between google's advertising cost and its advertising payout. They would buy ads to drive traffic to more ads, and make money on the difference. That's all. The site itself didn't matter, it was all about ads. Google, to their credit, discovered that they weren't making a profit from this customer, so they adjusted their prices accordingly.
And? If you go to work and get paid $50,000, your employer is "exploiting" the difference between the value of your work and what they pay you. That's not a bad thing. An employer adds a lot of value (a team, equipment, various capital expenses) a typically employee could not use on their own.
So it goes with this guy's site. He might have been exploiting a difference, but he was also adding value. If he were not, then the advertisers of the ads he was making money on would have been advertising where /he/ was advertising.
Arbitrage is not in itself bad or deplorable. People seem to have a personal vendetta against it on the Internet, however, due to their undeserved phobia of advertising - an industry that has pretty much fueled our economy (and the Internet generally) for a good 50 years now.
No, but it is annoying because it ends up producing lots of junk on the internet that doesn't really contribute to people finding the information they want - it actually puts another layer in the middle in many cases. I have no problem with advertising, when combined with something of actual interest or value.
> If he were not, then the advertisers of the ads he was making money on would have been advertising where /he/ was advertising.
Or he was just exploiting a temporary hole in the market, in which case, good for him, but he has no right to complain about getting shut down by the same market.
oh my gravy, i have to stop.... i'm so excited and typing so fast I can barely breath
They should also be willing and able to tell you whether or not you paid for a particular click in your logs. I have had difficulty getting that information from them.
People currently do this, but it's very unpredictable due to lack of information. With information, some advertisers would be more informed than others and have an advantage - this is not what Google wants because informed advertisers spend less and I suspect Google would rather have uninformed "stupid" advertisers wasting $1000s per month propping up their business.
If his site had no "value" then how was it creating $155k/mo of profit? Out of thin air? By browsers forced at gunpoint to click on ads? It had value.
http://timepieces.sourcetool.com/index.php?s=0&l=2&c...
Looks like a spam directory to me.
When I ran a site that had adwords I hated directories like this they would fill up all the ads on my site and no one would click them nor would anyone be happy if they did. It was a constant battle of banning those domains from ads I would allow on my site.
Why not? Google does something similar itself with its "link units" where you click through to a new page with a whole group of ads.
Advertising is not immoral (usually), illegal (usually), or some sort of thing to wipe out. Buying cheap and selling high is how the world works - whether you're selling labor, bricks, commodities, or, yes, advertising.
Would you be raising similar objections if, say, the Yellow Pages advertised with "Find all Builders in YourTown, FL", and it then went to a page with a (paid) list of all the builders in said town? If so, why? It'd be useful and a good demonstration of arbitrage.
In particular in this case, the issue is not that the ads had 0 value themselves. Obviously, as you point out, his sites had some value. However, that value is clearly less than that of actually relevant search results (or so Google, the worlds foremost authority on search results, believes). Therefore the profit comes from externalizing the costs, rather than from value creation.
But nonetheless, I think they are adding value. Here's why i think that:
A. Customer utility (for a subset of customers) is higher for search results presented in the style of Sourcetool than in the style of Google. (i.e. Google isn't all things to all men - no shame in that).
B. Those customers do not know about Sourcetool, but do know about Google. (market inefficiency = imperfect knowledge)
So assuming this customer ultimately wants sourcetool style results, there are three steps to be taken:
0. Customers goes to www.google.com
1. Google refers them to Sourcetool
2. Source tool provides the desired services (even if that includes serving an ad)
In this scenario, both Google and Sourcetool should capture the value associated with giving the customer what they want - they both played a part.
I dont know if both parties are capturing value, but its certainly true that they both could. Google gets paid by the advertiser who places the ad served by AdSense, so even if Google's two transactions with Sourcetool are net negative, Google may well be coming out net positive with the inclusion of the transaction of the AdSense advertiser.
Seems to me that Google should merely be setting is rev-sharing terms with Sourcetool to ensure that both parties capture value.
tom saffell
1) Assuming he got 100k visitors per month
2) Assuming each arb gets him $0.10 per click.
3) Assmuning 50% of the visitors click 1 ad (and that's wildly optimistic)
His profit would be 50k x $0.10 = $5k/mth
If he were to get $155k in profit per month. he needs to get about 3 million visitors per month. I checked Alexa, Compete and his site is nowhere that figure.
Not sure what's his motive in inflating the profit figure though. He's only going to attract more competition to his field and kill his business in the process.
Maybe he's planning to write an ebook to convince people into believing that it is easy to earn that much with search arb and hence, he'll use the NYtimes article as evidence.
With each ebook selling for $99.99 and 100% profit margin, it'll take him only 1550 sales/month to meet his imaginary $155k profit claim. Now, that's a business plan!
He did get 3million visits per month.
http://www.quantcast.com/sourcetool.com/traffic (Change the period to All-Time)
Massive drop from 3million visits in April 06 to 100k in April 08 and now 10k in Aug 08.
Amazing if he attracted the 3 million people to his site purely with Adwords alone.
I wonder how many terms he has to bid for (> 100k?)