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  Chatfield Reveals the Key Secret of AdWords

Jeremy C. has a post about ad auctions. At the end he says something that you may have heard before, but never as clearly or succinctly put:

Let me give you a disturbing vision… Google is actually operating a CPM bidding system. Yup. Your bid position is a consequence of the value you give to Google, per thousand impressions - but quantised to a penny per click.

It's pretty important to grok this if you want to understand AdWords...


  Congresswoman Speier says: Lower Speed Limit
Jackie Speier (D-CA) introduces a bill to lower the speed limit from 65 to 60, claiming it will save fuel.

She's a new congresswoman, yet she upholds the traditional inability of elected officials to do math.

Press Release here details her bogus rationale.

She cites figures from the Environmental Protection Agency’s website,, that say gas mileage decreases rapidly after 60 mph. “If you drive a Ford Taurus or Toyota Camry, which averages 25 miles per gallon on the highway, the difference between driving 60 mph and 70 mph results in a yearly savings of over $250. For pickup truck drivers, that increases to $470 and if you own a full-size SUV like a Toyota Landcruiser, we’re talking about a savings in excess of $750.” These figures are based on national averages of 12,000 total miles per year, of which 45% are highway miles.

Jackie says that if we go from averaging 70mph (which is above the current speed limit in most places?) to averaging 60mph, we'd save over $250 / year in our Camry.

Let's go to Google calculator:

12,000 mi / yr * 45% hwy mi = 5400mi/yr on the highway.

At 25mpg at our supposed 70mph max, that's 216 gallons.

With regular gas at $4/gallon, it's $864/year.

Now if we save over $250, we'd spend $613/yr in gas. And that means we would have improved our gas usage by just over 29%! AMAZING!

Of course later in the press release we see this is impossible:

The EPA’s numbers show that fuel consumption rises dramatically at speeds faster than sixty miles per hour. The website claims: “While each vehicle reaches its optimal fuel economy at a different speed, gas mileage usually decreases rapidly at speeds over 60 mph. You can assume that each 5 mph you drive over 60 mph is like paying an additional 30 cents per gallon for gas.”

An April 2008 article in the San Francisco Chronicle cited Patricia Monahan of the Union of Concerned Scientists: “For every mile per hour over 60 mph, she said, fuel economy drops by an average of around 1 percent.”

Those two quotes both don't jibe with anything close to 29% savings. The top quote from the EPA site equates to about a 15% savings going from 70mph to 60mph.

Applying that bottom rule linearly would give us a maximum of 10% total savings (and actually, the current law is 65mph, so it *might* mean 5%.)

Of course, no one would actually drive 60mph, and fuel consumption in real world conditions wouldn't really be affected by more than 2-3% But hey, who am I to question Congressional ability to screw up simple math?

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  Prediction: This will actually happen.

Funniest South Park bit since the World of Warcraft parodies.

Apparently the southpark guys now have their own video distribution, as well.



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Prediction: This will actually happen.


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Chatfield Reveals the Key Secret of AdWords
Congresswoman Speier says: Lower Speed Limit
Prediction: This will actually happen.