As Connected TV Ad Spend Soars, So Does Ad Fraud

Last year was an unpredictable one for the ad-tech industry. Everything the industry hoped to accomplish in 2020 planning sessions fell by the wayside quickly when Covid-19 arrived and disrupted every aspect of daily existence. But amid the disruption, certain corners of the marketplace—such as connected TV—have grown dramatically and in predictable ways, given the circumstances.

CTV advertising spend is projected to rise to more than $11 billion in 2021, up from $8 billion last year, according to eMarketer. The same report speculates that by 2024, spending on CTV advertising will reach $18 billion. Many OTT streaming services are announcing extensive programming for the coming year to make the most of continued stay-at-home policies and the cancellations of social activities.

But at the risk of turning that lollipop fuzzy, there’s an expression used at White Ops that may be pertinent: “Fraud follows money.” The ongoing rise in CTV traffic and ad spending will, almost certainly, coincide with a rise in incidences of fraud on those platforms.

Why rapid growth attracts fraud

Last year, White Ops uncovered the largest CTV fraud operation to date. The Icebucket operation impersonated more than 2 million people in 30 countries and counterfeited more than 300 publishers at its peak. At one point, fraudulent traffic associated with this operation accounted for 28% of all programmatic CTV traffic White Ops has visibility into, or 1.9 billion ad requests per day in the month of January 2020. We’ve seen this scheme adapt, expand and contract over the last year, while also preventing a number of other operations that never quite reached the same scale as Icebucket.

And in the past 12 months, the amount of CTV traffic White Ops has visibility into jumped more than 700%. That’s not an accident—more people are watching more CTV/OTT content and consuming more CTV advertising every day.

All of this is context for the opportunity that advertisers, as well as fraudsters, have on CTV platforms. As long as fraud continues to be a lucrative business model, there will be new entrants into that market. These fraudsters are well-funded and have little focus other than how to siphon off some of that $11 billion of the projected CTV advertising spend for themselves. What’s needed is a change in the economics of cybercrime—nothing short will truly solve the challenge. Only when it’s no longer worth it for a fraudster to try will fraud go away.

The battle against fraud can be won

To continue the work to combat fraud, the Media Ratings Council (MRC) recently awarded White Ops accreditation for pre-bid fraud prevention and post-bid fraud detection on all platforms, including CTV. That makes White Ops the first organization to be accredited by the MRC for end-to-end coverage against sophisticated invalid traffic on desktop, mobile web, mobile in-app and CTV environments.

The recent MRC accreditation validates our technological solution to the economic problem of fraud. But technology is only as good as everybody who uses it. Every attack on a partner of becomes a defense for every partner. The more people who participate and the more organizations that share their visibility into fraudulent web traffic, the more effective a solution like White Ops can be.

Today, White Ops has visibility into 85% of global programmatic impressions, making bot-or-not decisions 10 trillion times every week. While new markets mean new opportunities and new traffic, it also means there will be new fraudsters trying to take advantage of them. But selecting the right solution to spot and stop fraud before it impacts an advertiser’s bottom line is the first step.

John Waters joined White Ops in Aug. 2019, leading product marketing efforts for the Advertising Integrity product line. He has more than 15 years of experience with various companies in media and technology, including more than eight years within GroupM.