Microsoft Sues Over Click Fraud

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Pay-per-click advertising companies like Google (GOOG) have long downplayed the effects that click fraud is having on their businesses.

Now Microsoft (MSFT) is taking three Vancouver residents to court, alleging they made more than $250,000 by fraudulently clicking on competitors’ ads, the Wall Street Journal reports.

WSJ: The company alleges that the defendants engaged in “competitor click fraud,” one form of the ruse in which a perpetrator seeks to exhaust a competitor’s advertising budget while boosting the prospects of their own advertisements. Online advertisers pay based on how many users click on their advertisements.

Microsoft said starting last year that legitimate advertisers using its online advertising service began experiencing waves of fraudulent clicks on their advertisements, which were promoting auto insurance and virtual currency used in the online game World of Warcraft. After an investigation, Microsoft said it traced the source of the allegedly fraudulent traffic back to the defendants.

Read more at the Wall Street Journal →

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