Click fraud is a serious issue among most online advertisers and publishers who use Google or Yahoo to deliver ads. Historically, the search engines have kept very secretive about how they deal with click fraud in-house and downplaying reports from third party watchdogs who have reported far higher numbers than the search engines themselves.

Now, in a step towards more transparency, Yahoo has hired third party vendor Click Forensics to help them deal with PPC fraud perpetuated by both people and robots. Yahoo already has over 2,700 filters in place to detect click fraud and says that it does not pass those clicks onto its advertisers.

But, in the past advertisers have been burned, sometimes on a massive scale and have sued and settled with both Yahoo and Google. So, in order to combat this “fox watching the henhouse” phenomenon that makes advertisers and publishers nervous, Yahoo has hired Click Forensics to monitor and report fraudulent activity through its PPC network.

How much access Click Forensics will be given to the Yahoo data is anyone’s guess at this point. The search engines have been reluctant to open up their code to anyone because of two fears. First, they fear their proprietary information may end up in the hands of their competitors. Second, they fear their proprietary information will end up in the hands of hackers and others who want to game their system.

But, no matter. At least Yahoo is distinguishing itself from Google by taking a step towards transparency and employing a third party to validate click fraud statistics and perhaps even recommend ways to cut down or filter out click fraud.

In the end, this will give more advertisers and publishers trust in Yahoo for taking steps that is in everyone’s best interest. Sometimes just the perception of taking positive action will go a long way towards building better business relationships.

Filed under: Yahoo