Penalty charges applied by banks may be illegal.

Currently, the six major UK banks generate around £4.5 billion through penalty charges.

However, under the 1999 Unfair Terms in Consumer Contracts Regulations Act, penalty charges may only cover administrative costs, and not be for profit.

At present, no major bank will provide an actual administrative cost figure for penalty charges, and none have contested claims of charging for profit in the courts.

The issue has recently seen exposure by the BBC’s Money Programme, which covered the story of law student Stephen Hone, who was successfully able to claim back £840 in penalties charged by the Abbey through the small claims court.

The Office of Fair Trading is currently investigating the issue of bank penalty charges.

Overall, I think few people will be surprised by the suggestion that UK banks have been profiting from penalty charges, so the outcome of the OFT investigation should certainly be interesting.

In an interview with Google business product manager, Shuman Ghosemajumder, finds that invalid clicks detected by Google were less than 2% of total..

This means that Google currently detects that on average, around 2% of clicks purchased by Adwords advertisers as potentially fraudulent, and therefore invalidated before the advertiser even sees them.

The interview also showed that Google has four levels of fraud detection:

1. Search & Adsense filters
2. Adsense flagging system
3. Manual review
4. Requested investigations

where the first two are automated procedures, and the last two performed by Google Staff.

While there’s a lot of contention over the figures - after all, Google cannot state how much clickfraud they can’t detect - it does provide further transparency on the PPC process.

This is important because a key concern of advertisers is that search engines are not being transparent enough about how they handle clickfraud.

However, while PPC fraud still offers lucrative incentives for organised groups, especially via botnets, advertisers should always remain aware that there could still be fraud problems.

Therefore it remains a point of common sense that business owners with a large PPC spend should apply strategies and tools that may help not simply clickfraud, but also their PPC spend.

BT has selected Motorola, Inc to provide mesh Wi-Fi network infrastructure and services for six of BT’s Wireless City initiatives in the UK.

Under the terms of the agreement, Motorola will design, deploy and manage city-wide Wi-Fi networks with BT in cities such as Birmingham and Newcastle.

The Mesh Wi-Fi networks will deliver wireless broadband for use by public services, businesses and citizens in each of the cities. BT Openzone hotspots will be extended to enable wireless web access and email.

Contiguous Wi-Fi coverage will be provided to enable real time applications using for example, BT Fusion dual mode devices. Virtual private network (VPN) services will be provided for enterprise customers. These will also e-enable local authority workforces. Wireless closed circuit television (CCTV) will be provided to aid community safety and security.

Motorola will supply solutions from its MOTOwi4 wireless broadband portfolio. The solutions will be deployed across the cities on existing sites such as lampposts. The Motorola solution allows data to be backhauled wirelessly.

This saves the cost, time and disruption involved with building a fixed network. The networks will be Mesh-enabled, making them secure and robust and allowing the network to “self heal” should individual access points fail by rerouting traffic.

The Microsoft small business directory at bCentral appears to be closing down.

Microsoft is no longer accepting submissions to the directory, and additionally are directed to a new set of online services - which are focused on website design and development.

The news comes only weeks after the DMOZ directory broke.

Overall, while it’s not surprising that Microsoft would wish to focus on Office integration online, , the loss of the bCentral directory further cuts back on the potential for new business to develop strong links online.

Christmas is coming - but retailers are reportedly feeling a pinch in overall sales compared to the same period as last year.

The British Retail Consortium has warned that Christmas may not come to the high street until the last week or two before Christmas day itself.

Already retailers such as Argos, Currys, Debenhams and Borders are among the high street stores leading price cuts.

Other retailers, such as House of Fraser, Homebase, Focus, Tesco, Halfords and Superdrug, are following close behind.

However, although the high street is worried, online retailers should expect a continued boom as shoppers increasingly turn to the internet for a simpler and easier shopping experience.

It remains to be seen just how divided the spend is between both, once the ONS releases figures after festivities have died down.

Small and medium businesses are interested in the new technology of VOIP, but not so much that their interest over comes the pains involved with getting into the market.

The lack of movement by the small business is not a good sign for the VOIP vendors. Small businesses are usually the first to jump on the technology bandwagon, but the VOIP market has too many potential problems – mainly due to the number of vendors involved with basic set up.

New technologies, such as mobile telephony and data, laptops, and mobile computing, have allowed small business to compete in ways that would have been near impossible otherwise. VOIP does offer great advantages to these businesses, including reduced costs, but the market is just too complex.

Because of the numerous pieces involved with VOIP set up, there are lots of opportunities for something to go wrong. It takes much more to fix a problem, which means lots of time consuming trouble shooting. The smaller companies just are not able to do this.

To lure in the small companies, vendors are going to have to find a way to bundle and manage services. The research has shown that small business are 2.5 to three times more interested in VOIP when it is offered through a managed IP telephony and offers site to site VOIP services.

VOIP is the right direction for the small businesses. It’s just that no one is getting it right for them in terms of sales and delivery.

According to a uSwitch customer survey, broadband customers are increasingly unhappy with their service.

While uSwitch highlights that “most providers fail to match rising customer numbers with improved services and technology”, the truth is probably more unsettling.

Simply put, too often providers invest very little in customer and technical support departments - leaving customers unable to quickly resolve issues affecting their service.

For example, from our own experience, even business broadband customers using Pipex are commonly left holding the phone for 20 minutes before being answered.

Additionally, companies such as BT are so departmentalised that often customers can end up being pushed around in circles, unable to get issues resolved.

Overall, it seems that many companies have seen broadband subscriptions as easy money to tap into, but fail to appreciate - or properly invest in - customer and technical support.

Populer merchant payment processing gateway, Protx, has been acquired by Sage.

It appears the giant of accountancy and money management is looking to integrate its software direct with online processing:

The sale will give Sage the capability to integrate the Protx secure payment systems with their business management software, opening up new possibilities for potential and existing merchants. In time, merchants will be able to link and integrate their payment processing with back-office accounting, stock control and CRM applications in one business solution.

Overall, it’s an interesting move, especially in light of how other companies are trying to integrate various online and offline activities - not least Google and Microsoft.

However, this could very much provide a taster of what Google and Microsoft may both be trying to achieve in the longterm.

After all, Google already has it’s own online office management software, but has yet to integrate it with with PPC marketing.

A glimpse of the future of online processing, perhaps?

Correction: It appears that PDS has already been closed down, but stories about it’s existence continue to circulate on the internet as a new development (see comments below).

Businesses across the UK are being warned to be careful of a scam by a company by the name of Parcel Delivery Service.

The scam involves the random posting of cards claiming to be from PDS (Parcel Delivery Service), suggesting that they were unable to deliver a parcel.

The card then prompts victims to call a premium rate number - 0306 6611911 - in order to arrange collection of the parcel.

However, there is no parcel, and anyone who calls the number and hears a recorded message will already have been billed £15 for the phone call.

Trading Standards officers and the Royal Mail are already aware of the scam, and recommend anyone who receives a card from PDS (Parcel Delivery Service) to call the Royal Mail Fraud helpline at: 02072396655.

Alternatively contact the premium rate service regulator ICSTIS.

A study by Akamia and Jupiter Research found that slow loading websites were a major reason for shoppers to abandon them.

Although product and shipping prices were a key reason to shop - or not - at an ecommerce store, page loading speed was the second biggest factor.

The study interviewed 1056 internet shoppers over 2006.

They found that four seconds is the maximum length of time an average online shopper will wait for a web page to load, before abandoning an ecommerce store.

They also found that those who spent the most money online were the least patient, and more likely to abandon a website faster.

Other key factors influencing shopper decisions where:

- rapid checkout process
- simple navigation

Websites that performed well were most likely to be revisited.

Overall, page loading speed has always been highlighted as an important factor for online sales.

However, what this study additionally illustrated were the consequences to branding by poor loading, with poorly performing websites likely never to be revisited.

Google Adwords have introduced a new system of “quality scoring” which has resulted in complaints from advertisers.

As marketing manager Micheal Gray illustrated, costs for successful keywords have been seen to rise without apparent justification.

Other PPC managers have complained that the complete lack of transparency on so-called “quality controls” means it’s hard for some to perceive this as little more than milking the advertisers.

Some are concerned that the provision of data to Google via free tools such as Google Analytics are being used to increase pricing where possible.

However, it could also be possible that because the system is completely automated, that advertisers are simply seeing bugs in the system.

Overall, at a time when headlines about clickfraud are common, and PPC advertisers are concerned about getting real value, the continued lack of transparency in the quality scoring critieria can only serve to aggravate PPC advertisers.

ADDED: Jeremy Shoemaker posts that Google’s quality changes are especially intended to hit arbitrage users - ie, a business model that relies on paying for low-cost PPC keywords, to direct traffic to sites displaying high-paying PPC ads.

Channel 4’s Chief Executive, Andy Duncan, has said that online advertising is a threat to TV revenues.

He highlighted this by pointing out that at the current rate, Google’s revenues will outstrip Channel 4’s revenues by the end of the year.

Andy Duncan has already approached Google to discuss syndication of Channel 4 programming online, as well as lobbying Parliament to allow Channel 4 access to digital distribution.

According to Brand Republic, online ad growth has risen by more than 40% in the UK in the first half of the year to £917.2m, and is now just a percentage point behind national newspapers in terms of market share.

Google is a major power behind online advertising spend in the UK, and the recent comments and statistics help enforce that.

However, while Google’s position in online advertising is without contention, the fact that Google is currently valued on the stock markets at over $140 billion suggests that investors are vastly over-estimating its potential.

I mean, seriously - if Google’s revenues are equivalent to Channel 4’s, then would Channel 4 be valued at $140 billion?

While online advertising still has growth left in it, it remains to be seen whether Google’s presence in the increasing online advertising market will actually justify such a market cap.

A number of the world’s largest anti-spam organisations have come together to form an alliance to help fight spam across the world.

Set up by the OECD, the Stop Spam Alliance (SSA) is a coming together of the Asia-Pacific Economic Co-operation (APEC), the EU Contact Network for Spam enforcement Authorities (CNSA), the International Telecommunication Union (ITU), the London Action Plan for Spam Enforcement (LAP), and the Seoul-Melbourne MoU.

A key aim of the SSA is to gather information and resources on combating spam. It also aims to simplify communications and standards for stopping spam across continents.

Additionally, the organisation intends to provide help and advice for businesses seeking help on spam issues.

While it’s not going to stop spam overnight - if at all - the SSA can at least share intelligence with ISP’s to help filter spam from their networks.

Overall, the email spam problem is getting worse, and existing legislation in the UK and USA at least are at best, ineffective, at dealing with the spam issue.

Additionally, countries such as Russia and Eastern European countries have been havens for illegal internet activity, with huge botnetworks especially driven from them.

In the meantime, there’s little else ordinarily internet users can do, other than take reasonable precautions with the provision of their email address online, and keep those filters/anti-spam programs running.

A judge has ruled that a case involving a UK company’s servers being hacked from Russia can be tried in the UK.

The ruling comes over a bitter dispute after UK company Ashton claims its server in London were hacked in order to retreive sensitive commercial data on one of its client companies, Ansol.

Ashton claims Russian aluminiun company Ruscal and Tajikstan company, TadAZ, were behind the repeated server hackings.

Hack attempts were traced to a number of IP across Russia, including Ruscal’s own IP’s.

Ruscal claims a Wi-Fi system it operated at the time was insecure, and was therefore used by third-parties, rather than Ruscal employees.

While the case had yet to be brought to court, there has been a bitter dispute over legal jurisdiction.

However, Jonathan Hirst QC, sitting as a deputy judge of the High Court, ruled that as the servers were based in London, the legal jurisdiction was London, regardless as to where the data was sent to after.

This could be a very important case, because hacking and other illegal internet activity is flourishing in Eastern Europe and Russia.

While normally these illegal activities may not be seen as actionable, the ruling today means that if a UK company suffers hacking or other illegal damage to its IT infrastructure, there remains the possibility of bringing legal action in the UK.

Police in Glasgow have warned that 1 in 10 financial services call centres based in the city have been infiltrated by organised criminal gangs.

According to Strathclyde Police, the criminals either set up members as office staff, or else use threats on existing staff - in order to steal confidential financial details from customers.

These details could then be used for anything ranging from identity theft to siphoning cash from customer accounts.

While the Customer Contact Association (CCA) tried to play down the claims, it admitted it was an issue of concern.

Now Netintelligence have stepped in to slam vetting procedures for staff, pointing out that staff can often access core information systems after as little as two days training.

What this issue most highlights is that confidential user information can be very profitable to crominal gangs, and infiltrating call centres is effectively a form of non-virtual phishing - already a common method of trying to steal financial information online.

While it may be a concern for readers as customers, it’s also worth highlighting for those businesses that outsource call centre services to help run their business.

It’s also important to point out that there are “best practices” laid down by the CCA, and it’s worth getting an idea of how a potential call centre outsource project relates to these guidelines before completing a contract.

Rumours are circulating that Google are about to announce a major shake up of their Google AdWrods management structure.

Not only will this lead to a dedicated accounts manager for each account, but this manager will also push for inclusion on new audio and visual contextual advertising projects.

Google Adwords is already an extraordinarily popular PPC program, that is already estimated to take around 25% of all online advertising spend.

Additionally, Google have been developing advertising channels in Flash, Audio, and Visual media.

The recent acquisition of both YouTube and dMarc means that along with print media, Google are now positioned to fully exploit an incredibly diverse set of advertising channels.

Overall, it has to be said that it’s amazing that major competitors - not least Microsoft and Yahoo! - have allowed Google to get so far ahead in terms of PPC management.

However, Google are certainly not allowing themselves to stagnate in a similar manner and the movement into new media advertising formats for existing Adwords customers can only be an exciting development.

It remains to be seen, though, how successful any potential can be tapped into - but in the meantime, Google are not simply playing ahead of this game - they’re writing the rules.

Google has confirmed that it has no plans to apply a major change to how it ranks websites in its search results before this Christmas.

This comes after the past two years have seen major changes implemented before the Christmas shopping season.

In both previous instances, online retailers - especially small businesses often labelled “mom & pop” stores - found themselves losing huge revenues through loss of lucrative search engine positions.

Having strong search engine positions has become a key marketing industry in itself, as internet surfers will often turn to search engines not simply to find general information, but also to search for products and service they are interested in buying.

This makes having high search engine placement an important source of revenue for ecommerce retailers - which is all the more reason why their loss can have such a huge impact on revenues when they change.

However, despite the assurance from Google, recent changes have seen newer websites especially lose placement in Google.

Referred to as the “30 filter” or “-30 penalty”, this feature of Google’s search results drops a website down 30 ranking positions when a threshold is crossed - often from gaining too many links too quickly.

While this filter has been in operation for some time, it appears that the threshold for triggering the penalty has been lowered so that more websites may fall victim to it.

However, small businesses that find this occurs may find comfort - traditionally the 30 Filter is only temporary, and is automatically reviewed every 30 days.

Those websites that can take action to reduce link purchases and similar actions Google frowns on may therefore find their ranking positions returned after 30 days.

Overall, Google may be acutely concerned about negative publicity from such moves - which it previously would spin as “combating spammers”.

However, it’s nice for Google to communicate no major changes before this Christmas, and can only be a relief for those small businesses who are still holding strong rankings on Google into the Christmas season.

Platinax is a free business resource and mentoring service that celebrates 2 years helping SME’s this month.

Based in the Highlands of Scotland, Platinax is run by a volunteer staff of company directors from across the UK.

The key aim of Platinax is to help other SME’s work better with the internet and increase profitability.

This is namely due to the fact that the majority of businesses in the UK are still failing to overcome basic challenges in technical, presentation, and marketing areas. Challenges that can be easily solved with a simple awareness of the issues involved.

Platinax offers help through these key main areas:

1. Business Forum

The Platinax Business Forum is a place where business owners seek free solutions, learn tips and tricks, and network with other business owners.

Key discussion areas include:

Business planning, Accounts, Legal compliance, Marketing, Advertising, Search engine optimisation, Internet technology, Website management, Webdesign & development, Server hosting.

2. Business Directory

The Platinax Directory is rated as one of the internet’s best quality directories.

It’s also one of the most active areas of the website, and can help provide national and local listings to drive targeted sales.

Simply click through the directory links to a suitable category for a listing in local, national, and international business categories.

3. Small Business News

Platinax News provides latest business & technology information for SME’s in the UK, and is syndicated by Google News:

4. Business articles

Platinax offers an exclusive reading list of articles, tutorials, and interviews for those willing to take on the technical challaneges of the internet. Key subject areas include internet marketing, website management, and business practices online.

5. Advertising

Platinax receives an average of between 350,000 - 400,000 page views per month.

You can reach this audience directly with an advertising space on the left of every page, containing both a banner and direct link to your website.

Through October Platinax is offering a special promotional price of just £79.95/month - but only 4 advertising spaces are available.

- According to Dave Ashton at lead generation service Bizal Ltd:

“From the new business enquiries received to date over 70% have been genuine opportunities that have been able to quote for either a lead generation solution or sales development services i.e. sales training and hence are delighted with types of companies that see our banner advert.

We are also delighted with the level of customer service and hence look forward to continuing a mutually beneficial relationship.”

Platinax intends to continue to provide free help and support for SME’s in the UK, and looks forward to celebrating the next 2 years on the internet.

Oil prices have continued to fall, with prices today reaching their lowest for 2006.

The drop in oil prices has been gradual over the past few months, and uncertainty about production cuts by OPEC - coupled with a lowered projection of oil demand for 2007 - has led to trader ease about oil prices.

This is after record highs in July.

The price of oil has been a key factor in pushing up inflation over the year, and rising energy prices have put pressure on consumer spending.

However, despite the current falls, the impact of previous high oil prices are still ongoing.

Bank of England governor, Mervyn King, has indicated that manufacturers are already passing on increased production costs to consumers.

Expectations of any let-up on inflation in the medium-term remain uncertain.

The Bank of England is still widely expected to raise interest rates to 5% in November - something Platinax reported as likely as far back as June.

The CBI has attacked the way the government assigns contracts.

It says the current system of tendering £150 billion is fundamentally flawed, by leaving key decision-making processes in the hands of civil services with insufficient skills or experience.

The outome is that often civil servants are unclear what they want to buy at the outset, resulting in delayed projects and extra costs for both taxpayers and suppliers.

Risk aversion is especially seen as adding to contract costs by failing to make bold decisions that take innovation into account.

The CBI recommends more reliance on the Technology Strategy Board in decision-making processes, and additionally to model it on DARPA in the USA.

The CBI also recommends the creation of a Advanced Research and Projects Agency, which can funnel more government money in strategic research projects that the government can reap better rewards from.

Overall, it’s a fair point made that it requires a business person to make business decisions, and small businesses have often complained about the lack of access to government tenders.

However, the likelihood of seeing any changes in the immediate future are remote at best.