Unbalanced Information Diet: Warped Lens on the World / Ads of Japan Firms, Local Govts Being Posted on Dubious Websites

The Yomiuri Shimbun

17:35 JST, October 14, 2023

“The internet has become a chaotic space, brimming with outrageous, biased and fake information. The so-called attention economy, which generates revenue by getting people to click on or view ads, underpins today’s digital era. This is the third installment in a series of articles.

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Mangamura — a website that illegally hosted about 70,000 popular manga titles between 2016 to 2018 — is estimated to have caused about ¥320 billion in losses for authors and publishers, underlining the seriousness of copyright infringement.

Meanwhile, ad fraud, which illicitly gathers cash earned via online advertising, generates revenue for the operators of such dubious sites.

“Online advertising is full of loopholes,” said former Mangamura operator Romi Hoshino, 31. “There are countless ways to make money.”

The majority of online ads are generated via “programmatic advertising,” which uses algorithms and automated technology to place ads on countless websites.

Programmatic advertising is considered highly effective due to its flexibility, but it also allows for ads to be placed on illegal websites without the advertisers’ knowledge. This led to advertisements for leading companies appearing on Mangamura, which, at one point, boasted around 100 million monthly views.

However, once online platforms — which serve as a go-between for advertisers and websites — began to take countermeasures, the number of ads featured on Mangamura dwindled, with a concomitant decline in revenue.

While talking with an ad-firm acquaintance in the summer of 2017, Hoshino hit upon the idea of launching a “dummy” site that would trick leading firms into placing ads on the site via Yahoo Japan.

Yahoo is one of Japan’s leading online platforms, counting the national government, several local governments and leading companies among its clients.

Ads posted via Yahoo are expected to generate considerable revenue. For Mangamura to benefit from such ads, it was necessary to take advantage of loopholes in the online ad system.

Illicit revenue

Yahoo screens websites to ensure they conform to the law. In 2017, Mangamura was already considered to be a problematic site, with no way of clearing Yahoo’s screening process.

“Publishers were keeping close tabs on Mangamura,” Hoshino recalled. “Ads would be reported to the platforms as soon as they appeared on our website, then suspended.”

This led Hoshino to devise a scheme using “hidden ads.” To receive ads via Yahoo, Hoshino first created a dummy website that hosted online game-related articles, but which was “linked” to the Mangamura site. The underlying technology meant that when a user accessed the manga piracy site, the dummy website would open simultaneously.

However, the size of the dummy site was set to zero, meaning users never saw the site when they accessed Mangamura. Nevertheless, the dummy site was, in effect, considered as being accessed by the system, so ads posted to the site were counted as having been viewed by users, thus generating revenue for the site’s operator.

Mangamura was forced to close in April 2018. “Up until that point, [the site] pulled in revenues worth several hundred million yen,” Hoshino said. As the site’s operator, Hoshino was charged with violating the Copyright Law, and slapped with a ¥10 million fine and three years in prison with labor. Upon his release last November, Hoshino expressed his intent to file a retrial request.

Yahoo discovered the fraud in an ex post facto investigation. “Our system had been set up to detect abnormalities in the ads we distributed,” a Yahoo public relations official explained. “But back then, the method used [by the piracy website] was undetectable.” Following the case, Yahoo reinforced its system for detecting the abnormal distribution of ads.

Websites are continually being established to fraudulently generate ad revenue. When ads appear on problematic websites, people who access those pages may think that advertisers are “supporting” the sites.

Since around July last year, X (formerly Twitter) has seen a spread of posts with similarly dubious links. One such link led to a site with numerous topical news headlines, backed by articles and images that appeared to have been copied and pasted from other sites.

When Yomiuri Shimbun reporters contacted the newspapers and TV stations that had produced the original articles, it was found that the sites had used the content without permission.

Prominent on such websites were ads of such leading companies as Wacoal Holdings Corp., Recruit Co., and ANA, alongside those of local governments — including the Nagano and Tottori prefectural governments.

A survey conducted by Spider Labs, Inc., a Tokyo-based company that counters ad fraud, found that over 20% of the ads distributed online by a leading company were placed on spurious, related websites.

The reporters contacted about 40 companies and local governments that have placed ads on suspicious websites. Each entity had used programmatic advertising, but were unaware that their ads were being placed on websites suspected of copyright infringement.

“Our brand image could be damaged,” said a Wacoal official. “We intend to come up with countermeasures.”

Meanwhile, a Nagano prefectural government official opined: “We have to avoid public funds to become proceeds of illegal activities. However, the ads were posted unwittingly.”

After being contacted by Yomiuri Shimbun reporters, more than 10 advertisers withdrew ad placements from the problematic sites, while two of the platforms confirmed to have served as a go-between for ad placement on the websites — not including Google — announced their intention to terminate their contract with the sites.

The ad charges paid by advertisers likely went to the website operators.

A security expert dubbed “retr0,” found more than 100 similar websites with possible ties to an IT company based in Hebei Province, China.

The Yomiuri Shimbun requested an interview with the company, but it has yet to respond.