• by Joe Mandese  @mp_joemandese, May 25, 2010

In response to the growing threat malvertising - malicious computer code distributed via online ads or applications - represents to the online publishing industry, the Rubicon Project this morning said it acquired SiteScout, a Seattle-based security firm specializing in malware detection and prevention. Terms of the deal were not disclosed, but Rubicon executives said SiteScout's technology would be integrated into Rubicon's entire infrastructure, ensuring that no ads containing malicious code can be served on any publishers or ad networks it does business with.

The acquisition replaces a deal Rubicon struck early this year with San Francisco-based advertising security firm ClickFacts, which has also developed a sophisticated system for tagging and monitoring ads carrying malicious code, as part of its suite of advertising protection software and systems.

Rubicon COO and Founder Craig Roah said the decision to acquire SiteScout and embed its technology into Rubicon's infrastructure followed a "side-by-side test" of several leading malware detection and prevention systems, which convinced Rubicon that SiteScout was the best fit for Rubicon. He said the test was conducted in a "live production environment," utilizing actual ad tags on premium Web sites, and that SiteScout proved most effective.

Rob Lipschutz, CEO of SiteScout, said the technology his company has developed grew out of the cyber security industry, not advertising management and protection, per se, but he acknowledged that thwarting malware - even malware that utilizes advertising as a "vector," is a constant game of vigilance and adaptation, as "the bad guys" are constantly iterating and adapting the methods they use to distribute malicious code.

Advertising has long been a vector for distributing malicious code, but it began to accelerate over the past year as malware purveyors figured out that advertising management systems, especially the kind of third-party, self-serve systems that ad networks and aggregators like Rubicon depend on, were particularly vulnerable to attack.

Over the past year, major premium site publishers ranging from the NewYorkTimes.com to Gawker Media to Fox News have been hit by advertising-distributed malware attacks, raising awareness on Madison Avenue, and leading some publishers to institute new controls or to steer away from third party ad networks altogether.

Estimates vary, but malvertising attacks can have costly effects, driving traffic and usage of a premium publisher's site down as users become aware of them. Rubicon executives estimate the "net monthly risk" of malware attacks is costing online publishers $600 million monthly in lost revenues.