The relationship between Yahoo! (YHOO ) and an obscure Web site called Oemji.com illustrates why a growing number of companies are worried about where their online ads are turning up and who's actually clicking on them.
Yahoo recycles ads to Oemji even though several leading Internet security firms claim the site's owner also distributes software that can deceive and annoy computer users. Yahoo's own correspondence with Oemji's parent, Oemtec Ltd., confirms that the online giant knows about the controversy. Yet Yahoo continues to send ads to Oemji that advertisers and online experts allege result in dubious clicks and inflated bills.
Yahoo formalized its link to Oemtec in an Apr. 14, 2004, contract providing that Oemtec, which is registered in Barbados, would become one of the thousands of site owners that receive Yahoo ads. The contract, reviewed by BusinessWeek, states that Oemtec would receive 55% of the revenue from clicks on ads that Yahoo distributes to Oemji. Since advertisers pay Yahoo from a few cents to more than $20 a click, Oemtec's share of revenue from Yahoo ads could total many thousands of dollars a year.
Oemji isn't a 'parked' site offering only lists of ads. It features its own search engine, news and weather reports, and a program called Oemji Bar, which can be downloaded as a PC's search engine. Still, advertisers are questioning the quality of clicks from ads on Oemji, says Click Forensics Inc., an online auditing firm in San Antonio. Last month, Click Forensics found that nine of its advertiser customers received suspicious clicks via Oemji that originated in Asia, Africa, and other distant regions. 'You don't see that kind of traffic unless there is something sneaky going on,' says Tom Charvet, vice-president of technology at Click Forensics.
One frustrated advertiser is MostChoice.com. Chief Executive Martin Fleischmann says that, in the past year, Yahoo charged the online financial-information provider an estimated $10,300 for 2,690 clicks from visitors to Oemji. Ninety percent of the clicks came from such places as Mongolia, Vietnam, and Honduras, where MostChoice does no business. Only eight clicks, less than 0.3%, turned into sales, compared with 30% or more from clicks on ads on Yahoo's own Web site.
Questions about Oemji have arisen elsewhere. Computer security firms Sunbelt Software Inc. and Aladdin Knowledge Systems Inc. have posted consumer warnings, calling Oemji Bar a 'browser hijacker,' meaning software that can replace unwary PC users' search engines without permission, sometimes as they download other software from Oemtec.
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), have issued alerts about a different Oemtec product called SpySpotter. Available until last month at spyspotter.com, this program is supposed to clean computers of spyware -- programs that can track users' Web surfing and send them pop-up ads. But Symantec and the others say SpySpotter is actually a 'security risk' or 'rogue' product, because it can install itself without permission and send exaggerated spyware warnings to entice PC users to sign up for a $29.95 annual subscription. 'SpySpotter for a very long time has had a bad history of being force-installed or stealth-installed on people's PCs,' says Eric L.