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Cybercriminals increase Internet advertising click fraud

By Byron Acohido | USA TODAY

HANOI, Vietnam. (AP)

Click fraud is on the rise, as cybergangs step up the use of infected PCs to divert advertising dollars into their hands.

In the first three months of this year, 17% to 29% of clicks to online ads were fraudulent, according to separate estimates by Click Forensics and Anchor Intelligence, leading suppliers of click fraud detection technology. That's up from 15% to 25% in fourth-quarter 2009.

Cybercriminals increase Internet advertising click fraud

Advertisers pay website owners every time someone clicks on one of their online ads. Fraudulent clicks can occur manually, by an unscrupulous website owner, or by someone looking to waste a rival's ad budget.

Most often, click fraud is the work of cybercriminals who put up websites carrying online ads and no other content. The criminals then retain the services of cybergangs in control of sprawling networks of infected PCs, called botnets, which are directed to repeatedly click on the ads. This triggers payments to the crooks who put up the Web page.

A high percentage of bogus clicks get filtered by search companies and advertisers, says Kevin Lee, CEO of search consultancy

Still, the rising tide of faked clicks suggests click-fraud scammers are skimming off millions of dollars annually, Anchor Intelligence CEO Ken Miller says. "There are more dollars available for the taking now," Miller says.

Advertisers in 2009 paid a record $14.2 billion for clicks to online ads, research firm IDC says. Google took in 55% of that ad revenue, Yahoo, 9% and Microsoft, 6%.

With so much at stake, the big search companies take the click-fraud problem very seriously, Lee says, because "If they don't catch the fraud, it erodes advertiser confidence."

Google lets advertisers monitor for patterns of fraudulent clicks. Advertisers can dial up "the exact number of clicks we are filtering out on each ad campaign," Google spokeswoman Rachel Nearnberg says.

Yet, preventing click fraud is proving as difficult to stamp out as e-mail spam. "Spam generates a few cents per thousand e-mails sent, but a click-fraud criminal may make several dollars per thousand fraudulent clicks," says Gunter Ollmann, research director at security firm Damballa.

Botnet-driven campaigns "generating a huge volume of clicks and huge fees" are becoming more common, says Paul Pellman, CEO of Click Forensics.

Most often, advertisers eat the losses. "Advertisers are paying much more than they should," says Marissa Gluck, managing partner of Radar Research. "It's theft, plain and simple."

Learn more about Search Engine Optimization, the most effective form of online advertising.

Search Engine Marketing is the fastest growing advertising medium in the world, projected to become 10x more powerful and influential than traditional media outlets such as: network television, cable television, local television, network radio, local radio, satellite radio, national newspapers, local newspapers, magazines, billboards, direct mail, telemarketing and more.

Discover the most powerful and effective form of advertising, Search Engine Optimization.

An aside for consideration are the segments of Search Engine Optimization. Clarification is required in terms of paid search marketing, sponsored search advertising, pay per click, email marketing (spam), and the foundation of strategic internet marketing: Organic Search Engine Optimization - Organic SEO in some circles also referred to as Natural Search Engine Optimization - Natural SEO.

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