Is Google's search for quality content a ruse for a massive diversion of cash to its own sites?

Summary:Google's search for quality content has harmed huge numbers of quality web sites. But it's been great for Google's surging revenues... What's going on?

I've been writing about Google's Panda algorithm change and the huge amount of pain that it's caused for content websites since it was introduced in late February.

Before the launch of Panda Google spent months bad-mouthing "content farms" and how the new algorithm would weed out the bad content. The first version was called "Farmer" as a reference to "content farms" — sites that scrape or produce low quality content just to game search rankings.

Who could argue with such a noble goal?

Yet when the Panda "Farmer" algorithm hit the Internet, it failed to highlight "quality" content. Quality sites, such as my friends at Ubergizmo, lost rank and their scrapers ranked higher than them. That's an #epicfail.

[Please see: More On Panda Pandaemonium.... - SVW}

There have been lots of sites that have suffered tremendous losses. Some of the stories are heartbreaking. Here are some quotes from a Google blogpost asking for examples of good quality web sites that have been hurt by Panda: 5,835 replies.

...we are interested in hearing feedback from site owners and the community as we continue to refine our algorithms. If you know of a high quality site that has been negatively affected by this change, please bring it to our attention in this thread. Note that as this is an algorithmic change we are unable to make manual exceptions, but in cases of high quality content we can pass the examples along to the engineers who will look at them as they work on future iterations and improvements to the algorithm.

Here's some of the replies illustrating the enormous hurt that Panda has caused many legitimate, high quality content sites:

I am so devastated. My main site and my life's work, cure-back-pain.org was drastically affected. I am not a learned webmaster, I am a back pain patient and someone who writes to help others recover. My site is 5 years old and has often led in the rankings for my topic, back pain and back pain treatment.

I was let go from my "dayjob" in the economic decline of 2008 and found a savior in the fact that I could make a living helping those who needed it most, so I turned to my site full time and found it very rewarding. I write all my own content and work my site 80 hours a week+. I do everything myself.

... with the terrible downturn in rankings, I am most likely going to lose my house. This is not an exaggeration. My wife and I are in free fall now, as we are both casualties of this economy. This is a very sad to me, but I am not here to cry about money. Just as important is the fact that I spent 5 years building a safe haven for back pain sufferers to find honest info and help without feeling like they have to spend all their money doing it.

There's lots more stories in a similar vein here.

Lots of losers due to "bad quality" of content. But one massive winner: Google.

Since Google launched Panda it has beaten Wall Street estimates twice. It's revenues have surged tremendously, yet for much of the past year and more, Google's revenues to its own sites (AdWords) barely could keep pace with revenue to its partner sites (AdSense).

Here's an example for 2010 revenues:

- In Q1 Google sites grew 20% and partner sites grew 24%.
- In Q2 Google sites grew 23% and partner sites grew 23%.
- In Q3 Google sites grew 22% and partner sites grew 22%.
- In Q4 Google sites grew 22% and partner sites grew 24%.

At no point did Google manage to exceed growth in revenues from its partner sites.

Yet suddenly in 2011, under new CEO Larry Page, everything changed:

In Q1 Google sites grew 32% and partner sites grew 19%.

In Q2 Google sites grew 39% and partner sites grew 20%.

Yet for the past year and more, Google couldn't keep up with partner sites and all of a sudden it is surging ahead.

What caused this sudden reversal in fortunes? It looks like it's due to Panda.

Google is taking away traffic from its partner sites and that means it doesn't have to split the revenues, about 68%, with partners -- it keeps all the money.

Some have been waiting for Google to flip a switch and grab AdSense traffic and revenues. It is something which Google has the means and the motive... Larry Page, the new CEO, now looks fabulous.

With all the high quality web sites being hit with tremendous traffic losses, 50% and more, and with Google sites surging in traffic and revenues, it is evident that Google's push for quality content was a red herring, a ruse to divert revenues from its AdSense partners to its own coffers.

This kind of behavior will most definitely attract government regulatory scrutiny. What Google does or doesn't do affects millions of businesses globally, it affects hundreds of millions of people's salaries -- it affects entire economies.

GOOG's CEO Larry Page is likely betting that Google can move faster than regulatory bodies can crack down. And he's right. But is it right?

---

Please see:

HubPages CEO On Google's Panda: SEO Doesn't Work - SVW

Scary Google: Larry Page Wants To Change The World - SVW


Topics: Enterprise Software, Banking, Browser, Google

About

In May 2004, Tom Foremski became the first journalist to leave a major newspaper, the Financial Times, to make a living as a full-time journalist blogger. He writes the popular news blog Silicon Valley Watcher--reporting on the business of Silicon Valley.Tom arrived in San Francisco in 1984, and has covered US technology markets for leadi... Full Bio

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