Botnets Accounted for 42.6 Percent of All Click Fraud in Q3 2009

Click Forensics®, Inc. today released advertising audience quality figures for the third quarter 2009 from the industry’s leading independent online advertising and click fraud data reporting service. Now in its fourth year, the Click Forensics reporting service provides statistically significant data collected from Cost Per Click (CPC) advertising campaigns for both large and small advertisers across all leading search engines as well as comparison shopping engines and social networks. Traffic across more than 300 ad networks is reflected in the data. Key findings for Q3 2009 include:

• Botnets accounted for 42.6 percent of all click fraud in Q3 2009. This was a significant rise – more than doubling in the past two years and up from the 27.5 percent reported for the same quarter last year.
• The overall industry average click fraud rate was 14.1 percent. That’s up from 12.7 percent for Q2 2009 and down from the 16.0 percent rate reported for Q3 2008.
• In Q3 2009, the countries outside North America producing the greatest volume of click fraud were the United Kingdom, Vietnam and Germany, respectively.

“The significant rise in botnet-generated click fraud lines up with recent findings of several well-known malware and online fraud tracking experts,” said Paul Pellman, CEO of Click Forensics. “Botnets perpetrating click fraud and other online schemes continue to grow in number and sophistication. Advertisers and ad providers need to be especially vigilant about such activity as we enter the competitive search marketing holiday season.”

In Q3 2009, Click Forensics discovered a new highly sophisticated click fraud botnet dubbed the “ Bahama botnet,” which was first detected redirecting traffic through 200,000 parked domains located in the Bahamas. The malware distributed botnet hijacks natural search queries and also employs automated clicking to mask itself as a good source of search advertising traffic in order to steal from advertisers and search engines. Click Forensics found a link between the Bahama botnet and the recent NYTimes.com display ad scareware incident. The source of both attacks was traced back to the Ukrainian Fan Club, a known group of online fraudsters.

The Click Forensics online advertising reporting service publishes data collected from the industry’s first independent third-party Cost Per Click (CPC) and Internet advertising fraud detection service. The service is unique in that it monitors online campaigns for fraud by correlating advertising campaign data collected from over 300 ad networks and advertisers’ own web sites – providing the industry’s most accurate view of online advertising audience quality to date.

For more information on the recent Click Forensics data, visit http://www.clickforensics.com/resources/click-fraud-index.html.

About Click Forensics, Inc.

Click Forensics is the industry leader in audience verification and traffic quality improvement for the online advertising community. Click Forensics provides audience verification and traffic quality management solutions for leading online advertisers, publishers and ad networks, including companies such as Yahoo!, eBay, Progressive Insurance, Experian, Nextag, Moxy Media, Turn, Traffic Engine, Vegas.com and many others. The company also publishes data on online advertising audience quality, including the Click Fraud Index ^®, the top independent source of industry click fraud data. Click Forensics is headquartered in Austin, Texas, and is privately held with funding from Sierra Ventures, Austin Ventures, Shasta Ventures and Stanford University. More information on Click Forensics and its offerings is available at www.ClickForensics.com.

Click Forensics and Click Fraud Index are registered trademarks of Click Forensics, Inc. All other company and product names mentioned are used only for identification and may be trademarks or registered trademarks of their respective companies.