ISPCON Keynote Speaker Offers to Monetize Search for ISPs

Former Army major turned CEO Clarence E. Briggs III told ISPCON that the payment structure of the billion dollar search advertising market encourages theft, and offered his solution.

by Alex Goldman ISP-Planet Managing Editor [July 3, 2007]

Sometimes two rights makes a wrong. Grid computing is a good thing, and paid search and internet advertising have helped make the internet the success it is today. "Put them together," asserted Clarence E. Briggs III, CEO of Fayetteville, N.C.-based webhost AIT, "and you get clickfraud. Google and the others get about 95 percent of their revenue from affiliates."

Briggs said he understands how fraud happens. "They put an adwords banner on their site. Maybe they click on it once and think, 'that felt good.' Then they click on it lots of times, until their trigger finger gets tired. So they go on the internet and get software like Clicking Agent."

He said he learned all of this the hard way. He was bidding on Google ads and paying more and more money to obtain less and less revenue. "So I said to my marketing guy, 'Lou, you want to keep your job? Figure this out.'"

The answer was that the traffic was fraudulent. Some ads were seeing 20 to 40 clicks per second. "I found it difficult to believe that this was the result of good hand-eye coordination."

So, in late 2005, the company led a class action suit against Google. At the time, Briggs complained, "you get a phone bill with the numbers for which you were charged, but Google does not and will not provide you with records showing you the clicks for which you were charged or where they originated."

The company that Briggs built
Since then, Briggs has built the system he was asking for. It's called tyBit. Briggs admits that while his marketing people have invented a rationale for the name, in fact he chose it because it was a five letter domain that was available.

AIT was founded in 1996 near Fort Bragg in Fayetteville, N.C. The staff is ex-army. "We have no people from Harvard or MIT," says Briggs. "Management is the guys in the war room."

The company started in Briggs' garage. He says that while doing early funding calls he was asked why, if he was business, there were children running around in the background. "We're an internet company and we provide child care," Briggs told them. Several in the audience had said the same.

During the downturn, the company decided to invest and grow. "I like to say that everyone else went left and we went right."

The company purchased a data center out of bankruptcy for $36,000 and a promise to the local government to create 250 jobs, invest $205 million, and stay in town for five years.

It grew the hosting business through the channel, selling to VARs and resellers. Briggs claimed the company has over 7,000 resellers.

The company survived by being cheap and picking up the pieces from those who chose the most expensive route. Briggs said that in the dot com era, the company with "the most checkmarks" won the business, and so companies competed to provide more features and services without regard to price.

"We have mahogany furniture now," Briggs said. "We got it from a going out of business sale at a substantial discount."

The company used grid computing, generic hardware instead of dedicated NAS and SAN equipment.

Warrior
At one point during the presentation, after describing his victory over Google, someone in the audience leaned over to me and said, "don't get in this guy's way."

Briggs told several other stories with the same message.

At one point in 2000, he said, AIT's registrar was hit with a DDoS attack coming from NASA and France's Ministry of Finance. "We called them and neither helped us."

So he reflected the traffic and got calls from both NASA and France's Ministry of Finance. "When I got the call, I said, 'you may have a problem but we have no problem here.'"

He heard of a plan to build a Web Hosting Guide (WHG). The WHG was asking for the financials of all webhosts and payment. Three days before it was launched, AIT launched VeriHost using a system that guaranteed webhosts that their financials would be reviewed under NDA by third party CPAs, ensuring the confidentiality of vital information and thereby ensuring that webhosts would choose VeriHost instead of WHG. VeriHost succeeded, Briggs said, and "WHG is now a webhosting company."

The search that Briggs built
Briggs returned to tyBit. He said it delivers client-side search for ISPs using a decentralized (grid) architecture that provides spider, retrieve, and display functions (as opposed to index and store).

He said tyBit benefits subscribers, advertisers, and its ISP partners. Advertisers receive a bill with detailed reporting covering each click. (Does the bill show the IP address or other data of the person clicking? He didn't say.)

"There's no incentive for click fraud," Briggs claimed.

Malware prevention (offered in partnership with Panda Software) stops viruses from perpretrating clickfraud. The itemized bill allows advertisers to know where their ads were running. "Blogs associated with Osama Bin Laden had Google AdSense on them," he said. tyBit's advertisers would know immediately if this were going on, but Google's might never know.

"This is a new search paradigm," Briggs said.

He estimated that an ISP with 1 million users could generate $0.56 per user per day, for $560,000 per day, depending on the price of ads and given a 1 percent clickthough rate.

Of course, if clickthroughs drop by a factor of 10 or 100, revenues would drop in a corresponding manner.

Also, tyBit will need advertisers before it can generate revenue.

Those objections aside, this is an interesting idea. Given the way the internet works, we expect to see it imitated soon, because imitation is the sincerest form of internet praise.

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