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The Next Vegas Will Be A City That Lets You Truly Disappear – If Only For A While

By - April 21, 2014

sayminority(image) My daily reading took me to two places today – to Compton, California, well-known for its crime to anyone who grew up in LA (as I did), and to this NYT piece, which muses that the city, once the place we went to disappear, is likely to be the first place where anonymity is no longer guaranteed. (Not coincidentally, Pell found both pieces as well in his excellent NextDraft).

The Compton story informs us that for one month in 2012, the LA police department – not exactly a bastion of trustworthy behavior – surveilled the troubled district of Compton from the air, creating a 24-7 record of everything that was “publicly” viewable from the air. This piece chills me on a number of fronts: average citizens do not presume they are being watched from above, first of all. Secondly, do we want a society where such surveillance is presumed (read a bit of science fiction if your answer is yes)? And thirdly, this “wide net” of proactively collected data creates a record of actions that can be “rewound” and used as evidence after the fact – opening a raft of unsettling questions. It reminds me of one of Eric Schmidt’s creepier utterances (also known as the “nothing to hide” argument): “If you have something that you don’t want anyone to know, maybe you shouldn’t be doing it in the first place.”

The debate around privacy is nuanced and complex, I don’t intend to litigate it here. But as I read the Compton piece, it struck me that this particular genie is fast escaping the bottle. The Compton experiment was conducted using an airplane, but if you think police departments in major cities aren’t adopting far less expensive drone-based programs, I’ve got a bridge in Brooklyn to sell you…

Anyway, the NYT piece picks up where Compton left off, musing that cities offer the economies of data scale that make all public actions knowable well beyond their initial realm of physical expression. You may run that red light thinking no one is looking, but increasingly, the state is in fact looking, and will issue a ticket regardless of whether or not you were trying to rush a sick child to the hospital.  Not to mention the density of well-intentioned information-seeking marketers eager to connect your public presence to location-based offers (and that same data is, of course, available to law enforcement).

Which got me thinking. If big cities, once the refuge of anyone looking for namelessness, anonymity, or a new beginning, if those same cities become instead places where you can’t escape surveillance, it strikes me that our culture will respond by creating cities that promise exactly the opposite of that experience. Vegas has famously adopted “What happens in Vegas, Stays In Vegas” as its motto. But I find Vegas one-dimensional and depressing (save what Tony is up to). Instead I see Amsterdam as a model. I imagine vacationers of the future will want a far broader promise – they’ll be drawn to cities that have adopted a “no surveillance” policy – and in this way, the new Amsterdams of the world will be cities where visitors and residents are guaranteed there are no drones circling the skies, and no electronic, connected surveillance on the streets as well, beyond the time honored cop walking his or her beat.

Now that sounds interesting. I know I’d visit such a place on a regular basis, especially if the art (and the beer) was good…

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Else 3.10.13: Satoshi, Snowden, Google, And The Meaning of it All

By - March 10, 2014

nweekbitcoincover

The past week spun with controversy and breaking news around many of our society’s most interesting conversations: The elusive founder of bitcoin was identified, or perhaps not, Edward Snowden popped up at SXSW (by video, of course) and submitted testimony to the EU, the Aereo case is on its way to the Supreme Court (and launched in Austin at SXSW, of course), and in the end, we all long for something more. To the links….

The Face Behind Bitcoin – Newsweek The week’s most sensational story, which created a backlash worthy of the story’s claim.

Google’s Game Of Moneyball In The Age Of Artificial Intelligence – ReadWrite If the future of everything is tied to how we manipuate information through algorithms, then it makes sense to get as many of the brightest minds on your team. Also from ReadWrite:  Google At SXSW: The Internet Is Accelerating Social Change On A Global Scale In which Chair Eric Schmidt and Ideas Director Jared Cohen opine on the role of technology in autocracies (uncertain it’s a positive force, this is a shift from early techno optimism, I’d warrant).

Snowden Gives Testimony To European Parliament Inquiry Into Mass Surveillance, Asks For EU Asylum – TechDirt A nice overview of Snowden’s recent written testimony to the EU Parliament. Most interesting was his documentation of how the NSA plays one European country off the other to gain access to a plurality of data in each.

The Aereo Case Isn’t About Aereo, But About The Future Of Cloud Computing And Innovation - Techdirt An interesting argument about the nature of property and media rights – much more is at stake than simply whether Aereo is in fact legal.

Strictly algorithm: how news finds people in the Facebook and Twitter age – theguardian.com How do ideas find the public in the age of inscrutable algorithms? I find myself wishing for better tools to find good news stories – I’ve been using Circa lately and met with its CEO at SXSW. It’s a promising start.

A vast hidden surveillance network runs across America, powered by the repo industry | BetaBoston If there’s a profitable way to tag something of value, it’ll get tagged. That’s the lesson behind this story on the automobile repossession industry, which most has tagged your car at some point in the past year or so.

The question big data can’t answer: why? – FierceBigData Lots of data helps us understand how and what, but people are best at figuring out why.

The Internet is ready for a new cultural shift. Discuss. - gapingvoid - Hugh senses a wave forming in the Internet seas, one that will value signal over noise. I’m all in favor, but this initial essay feels more like a plea than a formed idea; still and all, I agree.

Traffic of Good Intent: We Beat Fraud By Working Together

By - December 06, 2013

TOGIscreen

Earlier this year I wrote a post titled It’s Time To Call Out Fraud In The Adtech Ecosystem. The overwhelming response to that riposte led to a lunch at this year’s IAB annual meeting, which then led to the formation of the Traffic of Good Intent task force (TOGI), an IAB-sanctioned working group composed of leaders from nearly every major player in the media and adtech industry. We’ve made a lot of progress since our first informal luncheon meeting nine months ago – I think the issue of fraud is now a top priority in our industry, and we continue work on best practices, solutions, and education. Today marks a milestone for our industry, the release of two white papers. Both are clearly written and intended to catalyze our progress to date.

Understanding Online Traffic Fraud gives a broad overview of the problem, laying out definitions of non-human traffic, and lays out half a dozen reasons you should give a sh*t. For me, the money quote is this: “Failing to root out traffic fraud funds criminal activity and supports organized crime.” Because as an advocate for publishers, that’s what fraud is: it’s stealing. It’s taking money and value out of the pockets of publishers, and putting it into the pockets of criminals. Along the way, any number of intermediaries also make money, and in the short term, they may be incented to continue to do so. We have to change that.

The second document, Traffic Fraud: Best Practices for Reducing Risks to Exposure, details actions all player in this ecosystem – brands, agencies, trading desks, technology providers, exchanges, publishers and more – can do to clean up this pervasive problem.

If you buy, sell, or traffic in online advertising, please read these documents, and help us move the needle even further. Fraud is not a problem that can be solved by pointing fingers or blaming one side or the other. We have to work together – and these documents are living proof that we can.

At Google Zeitgest 2013: A Conversation with Mark Kelly, featuring Gabby Giffords

By - September 18, 2013

For the past four years I’ve been honored to help moderate portions of Google’s annual Zeitgeist conference, which assembles a powerful lineup of speakers each year in the Arizona desert. I hosted the last segment of the day, and sat down with astronaut Mark Kelly, who is known for his career as a fighter pilot and Space Shuttle commander, and of course, as the husband of former Rep. Gabby Giffords. Since Giffords was shot two years ago, and after the terrible Newtown attack, Kelly and Gifford launched Americans for Responsible Solutions, a SuperPAC that is trying to take on the NRA using NRA lobbying tactics. Gabby comes on toward the end and left no one in their seats. Inspirational stuff – one of many such talks at the conference.

The PRISMner’s Dilemma

By - July 16, 2013

prismSometimes when you aren’t sure what you have to say about something, you should just start talking about it. That’s how I feel about the evolving PRISM story – it’s so damn big, I don’t feel like I’ve quite gotten my head around it. Then again, I realize I’ve been thinking about this stuff for more than two decades – I assigned and edited a story about massive government data overreach in the first issue of Wired, for God’s sake, and we’re having our 20th anniversary party this Saturday. Shit howdy, back then I felt like I was pissing into the wind –  was I just a 27-year-old conspiracy theorist?

Um, no. We were just a bit ahead of ourselves at Wired back in the day.  Now, it feels like we’re in the middle of a hurricane. Just today I spoke to a senior executive at a Very Large Internet Company who complained about spending way too much time dealing with PRISM. Microsoft just posted a missive which said, in essence, “We think this sucks and we sure wish the US government would get its shit together.” I can only imagine the war rooms at Facebook, Amazon, Google, Twitter, and other major Internet companies – PRISM is putting them directly at odds with the very currency of their business: Consumer trust.

And I’m fucking thrilled about this all. Because finally, the core issue of data rights is coming to the fore of societal conversation. Here’s what I wrote about the issue back in 2005, in The Search:

The fact is, massive storehouses of personally identifiable information now exist. But our culture has yet to truly grasp the implications of all that information, much less protect itself from potential misuse….

Do you trust the companies you interact with to never read your mail, or never to examine your clickstream without your permission? More to the point, do you trust them to never turn that information over to someone else who might want it—for example, the government? If your answer is yes (and certainly, given the trade-offs of not using the service at all, it’s a reasonable answer), you owe it to yourself to at least read up on the USA PATRIOT Act, a federal law enacted in the wake of the 9/11 tragedy.

I then go into the details of PATRIOT, which has only strengthened since 2005, and conclude:

One might argue that while the PATRIOT Act is scary, in times of war citizens must always be willing to balance civil liberties with national security. Most of us might be willing to agree to such a framework in a presearch world, but the implications of such broad government authority are chilling given the world in which we now live—a world where our every digital track, once lost in the blowing dust of a presearch world, can now be tagged, recorded, and held in the amber of a perpetual index.

So here we are, having the conversation at long last. I plan to start posting about it more, in particular now that my co-author Sara M. Watson is about to graduate from Oxford and join the Berkman Center at Harvard (damn, I keep good company.).

I’ve got so many posts brewing in me about all of this. But I wanted to end this one with another longish excerpt from my last book, one I think encapsulates the issues major Internet platforms are facing now that programs like PRISM have become the focal point of a contentious global conversation.

In early 2005, I sat down with Sergey Brin and asked what he thinks of the PATRIOT Act, and whether Google has a stance on its implications. His response: “I have not read the PATRIOT Act.” I explain the various issues at hand, and Brin listens carefully. “I think some of these concerns are overstated,” he begins. “There has never been an incident that I am aware of where any search company, or Google for that matter, has somehow divulged information about a searcher.” I remind him that had there been such a case, he would be legally required to answer in just this way. That stops him for a moment, as he realizes that his very answer, which I believe was in earnest, could be taken as evasive. If Google had indeed been required to give information over to the government, certainly he would not be able to tell either the suspect or an inquiring journalist. He then continues. “At the very least, [the government] ought to give you a sense of the nature of the request,” he said. “But I don’t view this as a realistic issue, personally. If it became a problem, we could change our policy on it.”

It’s Officially Now A Problem, Sergey. But it turns out, it’s not so easy to just change policy.

I can’t wait to watch this unfold. It’s about time we leaned in, so to speak.

Brand Pride

By - July 07, 2013
citipride

The Citi float at the Pride Parade in New York. About 200 Citi employees marched behind the float, many riding “Citibikes,” one of Citi’s most visible marketing programs in NYC.

Last week I was fortunate to be in New York City over the weekend, accompanied by most of my family. I had meetings with senior marketing executives at companies like Coke, Citi, and many others, and they stretched from the previous Weds. all the way into Monday of last week. I hate being away on weekends, and my wife is from New York, so she brought my daughters  to visit their grandmother, who lives right in the middle of Manhattan.

Now, a weekend in New York with your family is special anytime, but last weekend was particularly notable because of the annual Pride Parade. This celebration of LGBT rights is one of the largest in the world, and this year’s was historic – just the week before, the Supreme Court had voted down the Defense of Marriage Act, a major civil rights victory for the gay community and, by extension, for citizens across the country. Last Sunday, our family joined tens of thousands of others who cheered the parade down Broadway, marveling at the exuberance and yes, sometimes at the show of skin as well.

But what stuck out with us was the pure joy of the day. Both my daughters, one fifteen, the other nine, joined in the celebrations, waving flags, cheering, and slapping high fives with passersby. Everyone was so happy, and the party snaked down Broadway for hours. What really struck me was the diversity on parade – gay fireman and policemen (that can’t be an easy world to live in) marched in uniform, followed by politicians like Mayor Michael Bloomberg and Sen. Charles Schumer. There were community centers on floats blasting dance music, and a long assortment of “firsts” – the first gay married couple in New York, the oldest married couple in New York, etc.

And then there were the brands. Yes, the brands – sponsoring the parade, and marching as part of it. I was prepared to be disappointed, and even cringed when I saw the first banner announcing a brand – I think it was Vitamin Water, a Coke brand. But instead, I was inspired. I had just met with many of the brands that were represented, and it made me proud to know the folks who had the courage to stand out and stand up for what was right.

As I watched the parade I was struck at how deeply and how honestly these brands were part of the celebration. Sure, Vitamin Water gave out free drinks, but the real story were the legions of employees – from Citi, L’Oreal, Wells Fargo, Coke, Delta and many more who marched, proudly wearing their company’s logo, proud of their individuality, proud of their voice, and proud that their businesses have stood behind them on their journey to this historic day. It felt very real – these companies clearly had backed their people on the long road to full civil rights, and their employees were proud to celebrate their brand connection – they very much believed that in their lives, the brand on their t-shirt had made an important difference. It was a very honest moment, and that’s not always the case when it comes to sponsorships and marketing. It should  inspire all of us in the media business to follow the path of  true human connection in our work. It certainly inspired me.

We’ve Seen This Movie Before…On Traffic of Good Intent

By - April 26, 2013

(image) Back in 2005 I whipped off a post with a title that has recently become relevant again – “Traffic of Good Intent.” That post keyed off  a major issue in the burgeoning search industry – click fraud. In the early days of search, click fraud was a huge problem (that link is from 2002!). Pundits (like me) claimed that because everyone was getting paid from fraud, it was “something of a whistling-past-the-graveyard issue for the entire (industry).” Cnet ran a story in 2004 identifying bad actors who created fake content, then ran robots over AdSense links on those pages. It blamed the open nature of the Web as fueling the fraudsters, and it noted that Google could not comment, because  it was in its quiet period before an IPO.

But once public, Google did respond, suing bad actors and posting extensive explanations of its anti-fraud practices. Conversely, a major fraud-based class action lawsuit was filed against all of the major search engines. Subsequent research suggested that as much as 30% of commercial clicks were fraudulent  - remember, this was after Google had gone public, and after the issue had been well-documented and endlessly discussed in the business and industry press. The major players in search finally banded together to fight the problem – understanding full well that without a united front and open communication, trust would never be established.

Think about that little history lesson – a massive, emerging new industry, one that was upending the entire marketing ecosystem, was operating under a constant cloud of “fraud” which may have been poisoning nearly a third of the revenues in the space. Yet billions in revenue and hundreds of billions in market value was still created. And after several years of lawsuits, negative press, and lord-knows-how-much-fraud, the clickfraud story has pretty much been forgotten.

Sound familiar?

It should. Because the same movie is once again playing, but this time the problem has migrated to the open ecosystem of programmatic display. As anyone who’s studied the LUMAscape knows, we now have a VC-fueled industry worth billions, with many players primed to go public in the coming year or so. And the original search players – Google in particular, but also Microsoft and Yahoo! – are also major actors in this new industry.

My post from January of this year - It’s Time To Call Out Fraud In The Adtech Ecosystem - summarized the new breed of fraud in our industry, and recently, many publications  have intensified their coverage of the topic. In late February, I invited a handful of adtech CEOs to a lunch where we discussed the issue, and everyone at the table – from AppNexus to Google, OpenX to MediaOcean – agreed that it was time to address the problem head on.

And that’s how we got to the news  this past week that the IAB is standing up a task force on “Traffic of Good Intent.” I’m proud to be a co-chair of the group (and yes, the name does come from that 2005 post in these pages). This time around, there are many more players, a much larger industry, and a far more complicated ecosystem. But it’s worth remembering that bad actors always take advantage of open systems. It’s up to us to unite and drive them back. We should all be trading in traffic of good intent – real human beings, engaged with real content and services across the Internet. Our customers, partners, investors, and our good company names depend on it.

I look forward to the work.

An Apology To My RSS Readers – But I Had To Do It. (Updated)

By - February 22, 2013

Some random site running my last post without asking.

If you’re a fan of this site, you’re also probably a fan of RSS – a once-ascendant technology that has been on most everyone’s deathwatch for five or so years. According to Google’s (almost totally outdated) Feedburner service, nearly 450,000 people subscribe to this blog via RSS – although the number of you who actually read my posts is far smaller (according to Feedburner statistics, which I’ve never fully understood).

In any case, from time to time I’ve poked at you poor RSS readers, just to find out if you’re alive. Remember this piece – Is RSS Really Dead? Or this one - Once Again, RSS Is Dead. But ONLY YOU Can Save It!?

In those posts, I asked if my beloved RSS readers were really out there. Turns out, I got tons of comments back – a very high number given the work involved in declaring fealty to the creaky old standard. (It kind of felt like a reshoot of that wonderful final scene in Horton Hears a Who – “Everybody yell real loud, and maybe Google will hear, and not deprecate Feedburner…”  But I digress.)

I’ve always kept my RSS feed “full text” – which means the entire post, pictures, words and all, goes out over RSS, and can be picked up by any RSS reader anywhere on the planet. I always have held the belief that it’s more important that my work get distributed than monetized. But not everyone can afford such high minded principles. Many publishers cut their feed short, teasing folks with headlines and a snippet of the story in the hopes that people will click through to the site, where their visit can be properly “monetized” via advertising.

My new feed (sadface).

After much thought, I’m going to do the same. But not for the extra clicks and ads. It’s due to the fraud that’s taken over the content space in the Indpendent Web. Untold legions of bad actors use RSS to scrape “real” sites like this one, then wrap them with ads from exchanges to make a quick buck. The rise of programmatic fraud has made this even worse (see It’s Time To Call Out Fraud In The Adtech Ecosystem for more on this). And no, I’m not going to link to examples – but you can Google “Content Scraping” if you want to learn more.

So, consider this an apology. I am very sorry that you have to click a link to get to the content I make here every day. But also consider this a plea – as in, please do click that link at the top. I very much want you to be part of this conversation.

(And if enough of you complain, you know I’ll listen, and figure out some way around this).

 

UPDATE: I turned full feed back on. Thanks for all the input.

When It’s This Easy To Take Someone’s Money…

By - February 18, 2013

Earlier in the month I wrote about fraud in the advertising technology ecosystem – a post which has spawned dozens of fascinating conversations that I will continue to write about here and elsewhere. But this past weekend I encountered another kind of scam – a combination of time-honored phishing (online identity theft via social manipulation) and good old-fashioned wire fraud.

My family has been going to a small island off the coast of Massachussets for my entire life – my grandparents are buried there, my great grandmother moved there around the turn of the century (1900, not 2000!). My mother owns a cottage near the beach, a cottage that my great-grandmother purchased nearly 100 years ago.

Suffice to say, I have a deep history with the place. But with a bevy of kids and friends descending upon us each summer, my family has outgrown the cottage, so we’ve started looking for a larger place to rent. Like most folks these days, we turned to the Internet. We fired up VRBO.com, a popular marketplace for quality vacation rentals. It’s a great site for checking the market, and my wife and I figured we might get lucky and find just the right place.

We refined our search to mid-sized homes in Edgartown, MA available on the dates we wanted to stay. Most of the good places were above our desired price range, but one listing really stood out:

We are very familiar with the location of this house, having stayed nearly across the street a few years back. And boy, was the price right – about one-third that of similar homes in the neighborhood. This was a “new listing,” VRBO told us, meaning we were one of the first folks to find it. We better act quick, before this deal goes away!

We emailed the owner using VRBO’s contact widget (shown at right in the screen shot). Within hours, the “owner” had contacted us back. She was ready to send us a contract with payment information right away.

Now, I’ve been around long enough to sense when something wasn’t quite right. First off, she was using a non-personal email from Yahoo (the handle was “livinghome1234″ or somesuch). And the owner’s last name (her first was Kathy) seemed vaguely machine-generated – I won’t repeat it here just in case a real person’s identity has been stolen and re-used to portray the “owner.” When I put the name into Google, I got the kind of results that aren’t exactly comforting – a barely used Facebook page of a person in rural Pennsylvania, and a ton of “find this person” websites. It struck me that someone who owned a million-dollar home on Martha’s Vineyard probably had more of a digital footprint than this.

Secondly, the deal did seem too good to be true. Was I about to take advantage of some poor elderly woman who didn’t understand the true value of her home? Given my history with the island, I didn’t want to be the guy who did that. I decided to cross check Kathy’s name with public real estate records for the address in question.

Turns out, they didn’t match. The real owner of the property was a very nice-looking older woman who was obviously a real person – a year or so ago she had penned a sweet obit in a local paper for her dearly departed poodle. (I know the type very well, she reminded me of my Mom, who spends a lot of time on the island with her beloved golden retriever). Hmm. Well, could be that the person who contacted me – Kathy – was just an agent working on the owner’s behalf. That certainly happens a lot. I called the real owner’s number (it was listed in public real estate records), but got a full answering machine. Darn.

Cautious but still optimistic, I told “Kathy” to send me the contract.

It was about this time I got the following email from VRBO:

Ah, drat. The listing was believed to be a fake.

But hope springs eternal, no? I awoke the next morning to a contract from Kathy. It included wire transfer instructions for the full amount of the rental, to a bank based, interestingly, in the same town as the rural Pennsylvanian’s hollow Facebook page. And it had a phone number at the top – which, when dialed, informed me that the Google Voice subscriber I had called was not available.

At this point I abandoned all hope of snagging that swell house in Edgartown, and called VRBO’s fraud department. They  were nice, but not very helpful, reminding me that the site is “just an advertising service” that does its best to protect its users, but, to summarize: Buyer beware. I asked what made VRBO suspect that the listing was fraudulent, but the nice man on the other end of the phone refused to give any more information, citing privacy concerns.

So, why am I writing all of this up? Isn’t this just another pedestrian case of Internet fraud? Well, yes, and that’s kind of the point.

Think about how easy it was for the fraudster to run this scam. First, scrape all the information from a real listing (probably last summer’s in this case), and resubmit it under a different identity.  Second, create a free email account and Facebook page for an owner’s identity, just in case a renter Googles the fraudulent name (as I did). Third, leverage Google’s free phone service to provide a contact number. And fourth, set up a bank account to collect the dough. Lather, rinse, repeat! After all, if only one in 10,000 attempts gets you a hit, it costs you nothing but time to create those 10,000 opportunities. And with some simple programming scripts, even your time isn’t really that taxed.

When it’s this easy to set up fraudulent transactions, they will flourish – and indeed, within a few hours of my being told about the listing’s suspicious nature, it was up again on VRBO, under a new listing number but otherwise unchanged. (I told VRBO about the new listing, and they once again banned it. But apparently, they don’t have any way to stop someone from listing it yet again.)

A quick perusal of the community boards on VRBO (or any other rental marketplace) reveals that this kind of scam happens a lot in the listings business. And there are some pretty basic steps one should take to insure you don’t get fooled. But to my mind the larger story here is one of incentive, trust and identity. If you take a look at the incentives working on VRBO, it becomes clear how easy it is to game the platform. VRBO wants to make it as frictionless as possible to list hot properties on its site. Renters like me want to quickly score the best deal on a hot property. And owners want to connect to VRBO’s vast market of potential renters.

But VRBO’s business model is also based on trust – as consumers of the service, we want to trust that the identities of those listing their homes for rent are in fact authentic. And clearly, for the vast majority of listings, that is the case. But given how easy it is for scammers to game the system with false listings, I don’t think I’ll ever be sending money to anyone I’ve met via their platform. And that’s a shame – because if VRBO and others took the time to qualify their marketplace up front, this kind of fraud would be far less rampant.

I think there’s a lesson here for all of us in the marketing industry. There are always going to be bad actors trying to game complex systems. Back when click fraud was a major issue, our industry had one major player who had the incentive to clean it up – Google. Google was the dominant player in search, and was a newly public company that couldn’t afford to be seen as profiting from fraud. But the programmatic adtech space is deeply fragmented, with scores of players, all of who are – according to many sources – reaping untold millions in revenue from fraudulent behavior. In short, the incentives to clean this up aren’t exactly aligned.

But imagine if just one major marketer – playing the role of the defrauded rentor – decides to make a public stink about fraud in programmatic exchanges, declaring they’ll never again spend money there. When that happens, our burgeoning ecosystem is imperiled. So once again, I say: It’s time for us to get further out in front of this problem. I’ll have more on how we might do so in future posts. Meanwhile, wish me luck in finding a place to stay this summer – from now on, I’ll be working with real humans who work on the island and know the owners personally. It might cost me more, but at least I’ll have a place to stay at the end of the day.

It’s Time To Call Out Fraud In The Adtech Ecosystem

By - January 26, 2013

A confusing landscape = ripe opportunities for fraud.

As part of research I’m doing both for the book and for my upcoming conference (the CM Summit, more on that soon), I’ve been in pretty extensive conversations lately with dozens of key players in the advertising technology industry. I find the ecosystem that has developed  to be fascinating, complex, and ripe with opportunity (and deeply important to the future of our society, not just marketing). I’ll be writing about it quite a bit in coming months. But before I do, I wanted to call out a growing issue that our industry will have to tackle sooner rather than later.

Just as in the early, wild west days of search (1999-2004), the programmatic advertising business – a multi-billion dollar marketplace growing faster than search, video, or anything else for that matter – is riddled with fraud.

That’s what many very reputable sources have told me in great length over the past few months. It’s something of an open secret, and more and more people are speaking out against it. Here’s Federated Media’s Walter Knapp on the problem, back in March of last year:

The great thing about the Internet is that it is built on the foundation of openness — from the way the domain system works to the way content and publishing are increasingly democratic. The core technologies embrace openness, sharing, linking and the ability to consume content across devices and across wired or wireless connections. Unfortunately, the openness we depend on in the digital media business is also available to people who can (and will) take advantage of this openness and exploit it for their own selfish wants.

Knapp notes two forms of fraud – ad injectors, fraudulent browser plugins that take over ad calls; and the practice of inserting an entire site into a 1×1 pixel hidden on high traffic but low quality sites featuring porn or music lyrics. Both are examples I’ve heard about over and over in my reporting. A third involves “stacking” ads one behind the other, all playing video to completion, often playing in inactive tabs. A fourth features refreshing ad calls on accelerated schedules or in inactive tabs. Yet another involves running as many ads as possible out of view, simply to gain “view through attribution” on a closed loop success metric.

More people are starting to call these practices out. AppNexus CEO Brian O’Kelly prominently featured the issue of fraud in his blog post celebrating his company’s recent $75 million funding, and what he intends to use it for:

Quality We will continue to invest in cleaning up the advertising marketplace. We’re proud of our anti-piracy stance, and our 5x volume growth this year indicates that you don’t need to serve on BitTorrent sites to be an ad platform company. We are investing heavily in fighting fraud, porn, malvertising, and malicious toolbars, and we are actively working on viewability tools.

Programmatic industry watcher AdExchanger puts it this way:

AppNexus’s pledge to invest money in ad quality issues is worth calling out. The issue is becoming more pervasive as companies emerge to exploit the vulnerabilities of real-time traded inventory to data and impression fraud, malvertising, and other nefarious practices. Fraudulent activities aside, the emergence of robust ad verification and viewability tools means display ad marketplaces and buying platforms must keep a clean nose.

It’s true that many folks are working on addressing the issue, including the IAB. But the bad actors are currently far ahead of the good guys, and worse, many in our industry are turning a blind eye, hoping the problem goes away in time, without too much publicity. Why? Well, nearly everyone gets paid from fraud – the publishers, the exchanges, the data providers, and the agencies. Even the marketers,who are footing the bill, feel like they are getting value – because the success metrics they’ve set up are being  met.

But fraud hurts the ecosystem in a massive way. It means that low quality, invisible, or purely fraudulent inventory is holding down the average value of the entire marketplace – hurting high quality, engaged publishers in the process, stunting investment in quality content.

Over and over, I hear that the reason CPMs (the amount of money a marketer is willing to pay for one thousand advertising impresssions) are so low is because “there’s infinite inventory.”

Hogwash. There’s only so much time in the day, and only so many pages where actual human beings are really paying attention, and the web (including mobile) is growing at a finite pace. There are even fewer places where marketers can be assured of quality, engagement, and appropriate context. It’s time we focus on identifying them, and ridding ourselves of the true source of “infinite inventory” – fraud.