Why transparency is the death for programmatic?

Without these ads, there wouldn't be money in fake news


Traditionally, we start the review of the new group of fake news sites with an article, where they were already mentioned. This time it is an article ”Without these ads, there wouldn't be money in fake news” by Paresh Dave, published in LA Times December 9, 2016. Considering that so far everybody writes about the fake news as a phenomenon of the viral spread of information in social networks, not as an audience imitation for ad fraud, the article is awesome, this is one of the best studies about fake news in common paradigm.


It showed us 6 examples of pro-Trump sites. We will focus on one of them, American Reviewer because it was the only one which was commented on by the digital media professional. “Fake news sites probably perform as well as a real news website, so I don’t think it makes an impact on my bottom line,” said lifestyle blogger Andrew Wise, who paid for a link to his LifeTailored.com website on AmericanReviewer.com…”


And here's how this site looks right now.



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And this is how it looked in January. All articles are deleted, only the main topics and ads remain. Google displays its ads instead of removed content. Why did such a popular site die? And was it really popular among real people?





The site was created on August 30 but was completely inactive throughout September. It was activated in the first half of October and immediately received 1,100,000 visits for two weeks. Here is the graph of monthly visits to the americanreviewer.com according to SimilarWeb.




There is the sharp increase just before the election, and the same sudden traffic drop immediately after it. This site appeared, got almost 2 million visits from Facebook for the 3 months, received more than $100,000 advertising payments and disappeared without any traces. Since the owner of the domain is hidden behind the nominal holder, advertisers don’t even know who’s got their money.




The Pro-Trump clones


This would be another sad story about unsolved ad fraud case if there was no service that let you know what the other sites this audience is visiting. According to Alexa, the most popular site among these group was americanupdater.com.


The title of this site is Political Reviewer, not American Updater, and it is absolutely identical to the previous one. We checked the domain Politicalreviewer.com, it was the third similar site with high traffic in an election period.


All these sites have the similar audience behavior pattern. Fast growing after launch to the same level of popularity and same dynamic on the peak. Two sites have the same traffic fall right after the hitting the top.





Alexa’s pages of 3 pro-Trump sites:

americanreviewer.com

politicalreviewer.com

americanupdater.com

Take a look at separated trajectories of popularity for each site synchronized by the timeline.





These clone sites have 4 Ad units per page. They generate for advertisers about 60 millions of ad impressions for their lifetime. Their combined income could reach half a million dollars. But the earnings were even greater because there were more than three such sites.


All clones have the same Google Analytics ID. As of the end of March, the same analytics are used by 32 identical sites. Some of them active at the moment, some have already completed their lifecycle, some are still free from traffic.


Today they can be divided into two groups by title and content template.

The first active group is 7 clones of “Conservative Brief”. All sites have the same pattern of audience behavior.






The second group of clones is 13 sites titled US News Central. They added to the same word press template one new element, a slider on top of the feed. Among these sites, there are many inactive. But every month, a dozen new sites appear. Some of them traffic-free, but all are regularly automatically updated, waiting for their use.







Synchronized renaming of clones


An interesting feature of this whole group of pro-Trump sites is the permanent change in their titles. For example, the sites Political Reviewer now called “US News Central”. Original US News Central, created December 30, 2015, still has no visitors.


The other 4 sites (as seen in the picture below) which were “Political Reviewers” earlier, now are titled “Conservative Brief”.




Creating more than 30 clones and synchronize their renaming during the half of year is absolutely senseless for real human audience. But it is very reasonable to hide the historical traces of digital media imitation for ad fraud.





There is no politics, just money


We still tried to figure out who is the real owner of these sites. During the investigation, we found the site with the same gray template, but with blue logo and title.


Thepoliticalvoice.com has the same fake “Breaking news” headers, Trump’s and Hillary’s photos, and stolen content. But after detailed look, we found, that is anti-Trump fake media.




Thepoliticalvoice.com also has its own clones on different domains. There is no political party, who will work with rivals supplier during the race. It's all very far from political propaganda, and from real people.





Anti-Trump clones


The anti-Trump clone sites has used two types of templates. The first one, gray, is the same with pro-Trump sites, and the second one, with the dark blue header.



The idea to imitate both Pro-Trump and Anti-Trump media was spontaneous. Initially, our digital entrepreneur relied on pro-democratic imitation, but in August 2016, seeing how Trump is gaining popularity, he decided to play on that field too.


Some pairs of opposite sites with similar domain names were registered in August 2016. Since October the owner has registered only pro-Trump sites.




According to SimilarWeb, 90% of traffic to all clone pro-Trump and anti-Trump sites come from Facebook.




Facebook pages are necessary for imitation of human audience




FB page, in theory, is the media, with its own content style, positioning, audience development and audience retention. But in fact, we see packs of republican and democratic FB pages, with have posted links on identical sites. There are a lot of FB human-like accounts, which like all FB pages of this group, have commented and shared similar clone sites. It seems, their main goal is just to imitate fake engagement, nothing more.




As you can see, imitation of the multi-million audience on FB consists of many layers: FB pages, commenters, link-sharers and primitive followers.


1. There are millions of accounts, operated automatically using the primitive monotonous algorithm. It is just a part of “cyber factory”, where artificial activity mixed with paid human imitation of an audience for fake engagement on FB.


2. There are several clones of political pages, with the same profile pictures, which share links to the sets of similar sites.


3. All clone sites need FB pages just to imitate the active audience and verification this page as a main source of the traffic.


4. Similar sites full of ads, get millions of visits from the social groups without any human presence.


5. Artificial traffic is generated with special software to simulate a certain type of user, needed for advertisers. FB pages, engagement, and trending are just legitimization of fraud.




How profitable is selling of software generated visits?


The key digital asset of the anti-Trump group is Realtimepolitics.com. It is the crown of this digital empire. It is perfectly optimized to maximize its ad revenue. It partnered with major data management platforms and ad systems. It has made almost 50,000,000 ad views in three autumn months. Even with minimum price $5 per 1000 ad views, its fake audience coast for brands more than $250 000. But we sure, according to the displayed brands, it’s CPM could be much more than $5.


The most important thing is that unlike pro-Trump sites which die after 2-3 months, this “media” has been successful for more than a year. It appeared from nowhere in the middle of January 2016. Just a month later, February 15, 2016, it hit the top 20,000 sites in the world by Alexa ranking. For the past 9 months, it has continuously ranked in the top 10,000 of the world. In February, it reached the second peak of its popularity.


On December 1, it reached 1345 Alexa rank (3.15 M monthly visits in November). February 27, 2017, it reached 1019 Alexa rank (2.9 M visits in February). A higher rating in February with lower audiences is due to the fact that the Alexa rating is a relative index.


All sites have hidden their owners. The main domains were registered with WHOISGUARD PROTECTED service, their nominal owner is WHOISGUARD, INC., Panama.


This company has no address, just P.O. BOX 0823-03411 and the only one contact phone for all 4,5 million domains. It is more than 80% of all 5,4 million domains that have been registered in Panama totally. This company is affiliated with one of the world's largest domain registrar ENOM.


If advertisers are seriously concerned about the opacity of ad supply chain, they should pay attention to the problem of nominal domain holders. Even having access to complete ad exchange data, they will never know who the real beneficiary is.






Who is selling fake audience to global brands?


Here we got the first clue. Back in early January 2016, domain Realtimepolitics.com was still on sale. The credibility of the domain with 10 years history is higher than for just registered one. So buying old domains for ad fraud is quite reasonable. The new owner, before hiding behind “Domains by proxy”, was John Bradley. It is impossible to find the right person with that name and surname, then we decided to look at the registration data. The email seemed strange for this owner.


gstupay (at) gmail (dot) com


At the moment, 28 sites are registered with that email. Among them, there is a gray pro-Tramp site Rightwingamerican.com, which now is one of the US Central News clones.


The name of the owner of this site is Geoff Stupay. He is a digital entrepreneur from Dallas, co-founder and CTO at two digital advertising companies, Lanista Concepts and Adiply (not to be confused with Addiplay (Double d), the UK digital company).



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Adiply is an advertising solution for publishers. It adds new ad units to the web and mobile pages. According to service Zoom.info, Adiply’s revenue was near $ 2,400,000 (2015).


Lanista Concepts reaches millions of unique users across hundreds of publishers. For brands the company delivers advertising through rich media, custom integrations, social media, video content and mobile devices. For publishers, the company helps to sell programmatically their ad places to big brands and maximize their earnings. According to service Zoom.info, Lanista Concept’s revenue was about $7,000,000 (2015).


Adipaly installed on the main democratic site Real Time Politics and its more profitable clone Political Updater. Lanista was installed on both groups of sites during the period of their activity.


Google Analytics ID of 4 pro-democratic sites (Americanjournaler.com, Americantogether.com, Politicalupdater.com, Thepoliticalvoice.com), previously was used for Lanistaconcepts.com during 4 years until January 2016.




Geoff Stupay is the professional tech entrepreneur. He has no problem to hire professional programmers to develop the algorithms for stats analysis, winning bid auctions and maximize the earnings. But he didn’t hire anyone and decided to use the ready-made solution. The main value of such optimization engine is not the code, but the partnership with programmatics, who sells publisher’s and reseller’s audience to brands.


So, Geoff Stupay used the b2b solution mthSense. It was backed by the most famous and powerful venture accelerator Y-Combinator.


MthSense is multi-platform ad optimization engine. Its co-Founder & CEO Mandar Agte, has risen investments from Y Combinator in September 2012. According to Techcrunch, Mth Sense initially was backed to improve mobile ad targeting based on user`s app usage history.


A year later, the company has got the partnerships and data-driven targeting engine but has neither clients no cash flow. So it was forced to make a pivot. Mth Sense was still focused on maximizing yield for publishers, but switch from mobile applications to websites.


In fact, this algorithm bears losses to the advertiser, selling them expensive places, which they could buy cheaper. But this would be a problem, If this ad was really watched by people.


According to Sam Altman’s blog post, the standard Y-combinator’s deal is $120k for 7% of shares. The company was official Summer 2012 alumni. And now it optimizes ad impressions for a fake audience.


So, the alumni of Y-combinator forсed to rent his product to talented adtech entrepreneur who earns with dozens of fake news sites. What is really today’s digital ecosystem, if such a thing could happen?


MthSense partnered with major advertising companies, which partnered with Open RTB. Open RTB is the global advertising exchange, that accumulates digital advertising from major programmatics. Lanista use mthSense, integrated with OpenX, Pubmatic and other ad tech companies.





Lanista Concepts has its own subdomain on OpenX “Lanista-bidder-d.openx.net”, it’s bidder integrated with Adtech, Pulsepoint, Pubmatic, AOL, and Appnexus. It has its own publisher ID in the every system, so, it can programmatically sell ads units to global brands. Lanista is not the only reseller for ads views. All clone sites directly have Doubleclick's ads.






What brands are affected


All sites have the perfect advertising optimization, for example for US IP without any web browsing history was shown the ads of Maserati. Sites have shown expensive rich media (North American University) and video advertising (Trivago). A lot of global brands still pay for an imitated audience of these sites. For example, Unilever, Nissan, Wal-Mart etc. See more examples in the data set.




So, we see that ad fraud is the selling artificial audience with the specific data that advertisers ordered to programmatics. For ad fraud business needs three components.


1. Digital assets. Media with legitimized popularity and with approved ads inventory.

2. Digital audience knowledge. What stats and characteristics of users are valuable for brands.

3. Digital ecosystem ties with both black and white sides. Partnership with ad fraud tech stack providers and programmatic/ad platforms.


For credible imitation of an audience, it is necessary to know specific stats of advertising biddings. And this is impossible without ties with data management platforms and third party data suppliers.


At all times, anyone has chosen the easiest way to wealth and prosperity. Every entrepreneur chooses the most profitable model of market behavior to succeed. Experience has shown that ad optimization for real humans is not a lucrative business. In today's digital ad ecosystem, the most profitable and secure way to success is just the digital audience imitation.



P.S.


After all of the above, some quotations from the article acquire completely new meanings. ”Without these ads, there wouldn't be money in fake news”, LA Times, December 9, 2016.


“There’s also the element of human nature. Advertisers want eyeballs and people are more likely to click on racier content. Though established news organizations may filter out the tawdriest ads, other sites will run them and profit from them'.


“Lots of junk is there because that’s what people call on,” said Mike Rosenberg, chief revenue officer at Content.ad.”






Appendix. The examples of affected advertisers

The screenshots list.


Auto

Maserati, Jeep, Nissan, Alfa Romeo, Toyota (RAV4, Yaris, Corolla), Chevrolet, Dodge RAM, Fiat, Cadillac (CMC).


FMCG

Unilever (Dollar Shave Club), Quaker, Hefty, G.H.Cretors, Soylent, The Laughing Cow, La Roche-Posay.


Entertainment

Amazon video, World of Warships.


Information technologies

Adobe, Hewlett-Packard (Enterprise solution), Google AdWords, Dell, IBM, Oracle, Microsoft.


Media

Financial Times, MIT Technology Review, Wall Street Journal.


Retail

Gilt, Amazon, Walmart, DOMO, ETON, Cabela’s, GAP, Adidas, Samsung, Best Buy, Apple (Beats), Foot locker (Eastbay).


Finance

Mastercard (Luxury card), Visa (Co-branding Visa Marriott), Paypal, Santander, AIG, Discover (Discover It).


Education

Vanderbilt University, Kaplan University, Maryland university, Villanova University, Penn State University, North American University, University of North Carolina.


Government & Charity

American Association Cancer Research, Department of Health, American Red Cross.