| Click Fraud Bigger, More Sophisticated Problem |
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BusinessWeek, Monday, September 25, 2006, 11:30 AM
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Click fraud is getting worse--and advertiser confidence in providers of search-engine advertising, namely Google and Yahoo, might be slipping. The widespread problem, like so many instances of fraud on the Web, is becoming more sophisticated. There's actually a thriving click-fraud underground teeming with small-time players operating large "paid to read" rings that have hundreds of thousands of members each. The report says members of PTR rings can be found from Kentucky to China, making from $25 to several thousand dollars per month. Other fraudsters deploy "clickbot" software to generate page hits automatically and anonymously. Google and Yahoo maintain that they're doing everything they possibly can to combat the problem. "It's absolutely in our best interest for advertisers to have confidence in this industry." says Shuman Ghosemajumder, Google's manager for trust and safety. But advertisers really have no way of knowing what their ad partners, who actually profit from click fraud, are doing to stamp out the problem. Most click-fraud academics and consultants estimate that 10 percent to 15 percent of clicks are fake, or roughly $1 billion in annual billings. Search engines, of course, then divide these proceeds with any players involved--meaning that some $300 million to $500 million could be headed directly to the click-fraud industry, which would make it about as big as the online video advertising market. A consortium of major brands, from travel site Expedia.com to mortgage broker LendingTree, is planning to go public soon about its growing unease over the problem.
Read the whole story at BusinessWeek.
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