How Online Advertisers Get Ripped Off by $6 billion per Year

I’ll admit it: Big Media and ad fraud make a bit of a divergence from our normal investing fare, but when I heard Professor Joshua Braun speak about ad fraud and fake (or fake-ish) websites at the Cambridge Disinformation Summit in late July, I had to learn more, and figured you might, too.

So I invited Josh to our BBAE podcast. 

We discussed the $6 billion a year in online ad fraud that happens – often as a result of quickly-popped-up inflammatory websites that use bots or “click workers” in developing nations to artificially boost their eyeballs, which they sell to ad exchanges. 

In the old days, a company making bird feeders might advertise in a birdwatching magazine. But thanks to website cookies, it’s no longer necessary: Internet users who’ve demonstrated an interest in birds (for example) will get served bird feeder ads when they visit any website – from mainstream news websites to extremist or hate-based websites (may of which were just stood up temporarily around a hot issue to profit from ad fraud).

Targeted advertising is a nice convenience. But the process is so computer automated that it’s hard for advertisers to prevent their ads (and money) from getting directed towards websites that may spread disinformation and harm society. 

A lie can travel halfway around the world while the truth is still putting on its shoes.

-Mark Twain

Two other things Josh and I talked about:

  • Should Google and Meta be broken up?
  • With organizations that produce original news struggling as ad rates have declined and social media (which often uses original news as baseline for commentary) has siphoned eyeballs, does the US need to subsidize primary news coverage? Or strengthen its public networks, as the UK has done with the BBC?

You can see Josh’s website here, and please watch our video below.

James 

This article is for informational purposes only and is neither investment advice nor a solicitation to buy or sell securities. Investing carries inherent risks. Always conduct thorough research or consult with a financial expert before making any investment decisions.

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