Click Fraud Incidents Rise During Q3 of 2010

It has been estimated by some sources that over 20% of clicks on pay-per-click (PPC) ads during the 3rd quarter of 2010 were malicious or unintended clicks.

Malicious clicks generated by click fraudsters and hackers have resulted in wasted ad revenue that would be otherwise credited to a web publisher. We have witness in increase in this activity over the past few months but the ad companies are starting to focus on taking action to fight against such fraud.

Click fraud has been a real problem for a few years now and researchers have noticed steep increases in the crime this year. Click fraud can be very damaging to a company because many of them rely solely on online ad revenue to operate their business. If it were not for advertisements on websites, then the internet as we know it today would cease to exist. By hackers taking credit for clicks that would otherwise be paid to the advertiser or web publisher, it takes ad revenue out of the businesses pockets.

PPC ads account for about 50% of online spending for advertisers. Google has the largest network of PPC ads which generates most of Google’s revenue. Click fraudsters have a goal to get computer users to unintentionally click on the PPC ads. How do they do it? It is rather simple, they use either a botnet (group of hacked computers instructed to perform malicious actions over the internet) or other sophisticated software that reproduces clicks on advertisements.

Automated attacks on social networks, video sites and mobile devices have also played a role in the increasing amount of click fraud incidents this year. Because of the potential loss of revenue for some sites, companies are taking action to implement technology and programs to monitor and fight click fraud. Some of the big dogs such as Google and Yahoo have already been doing this but it the click fraudsters have yet to close up shop.

It is very well possible that we may see even greater increases of click fraud in the near future because it yields such a high payout for the hackers who fraudulently generate clicks on PPC ads that they have setup on their malicious sites.