Click Fraud On The Rise

According to an article published a couple days ago on IT World, the fourth quarter of 2008 saw a 1.1% spike in click fraud as reported by Click Forensics. In the 3rd quarter of 2008 the fraud rate was 16%, in the fourth quarter it was reportedly 17.1%.

Click fraud is the #1 threat to the pay-per-click advertising model that so many advertisement publishing systems use, and has resulted in drastic revenue reductions for not only the advertisement publishing system itself, but it's publishers as well.

The fraudsters have reportedly increased the size and sophistication of their botnets, which are large networks of internet connected computers that have been infected with various trojan viruses that allows the botnet owners to use the processing power of these computers to automate tasks such as finding, and clicks, ads published on web sites.

Anyone's computer, even yours, could unbeknownst to you, be part of these botnets.

Click fraud is committed for any number of reasons, they can seek out ads of business competitors to try to drive up their advertising costs, they can try to discredit the advertising system itself, or any number of other reasons. Whatever the reason, it is a threat to the advertising business online, as these publishing systems need to continually advance their detection systems, publishers continually lose credit for clicks, making them less, and advertisers lose faith in the system.

Click fraud is a threat to us all in the business of the internet in any capacity. It's sad, but there's the facts of the fourth quarter, which may help partly explain the large drop in revenue publishers have seen recently.