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Joint Strategic Plan on Intellectual Property Enforcement SECTION 2 As digital advertising is dependent in part on the number of users who are exposed to the website ads, websites promoting counterfeit or unauthorized content can receive substantial digital advertising revenue when placed on pages featuring popular content, such as music, films, television shows, games, software, and eBooks. According to one recent study, operators of websites dedicated to unlawfully exploiting third-party content may have made nearly $250 million, with “the 30 largest sites that profit exclusively from advertising dollars by pushing stolen movies, music, and television programs” generating an average of more than $4 million dollars a year in illicit proceeds. 17 Excerpt of Testimony Before the House Committee on the Judiciary “As a global leader in online advertising, Google is committed to rooting out and ejecting rogue sites from our advertising services. Google continues its efforts, both proactive and reactive, to detect and act against advertisers and web publishers who violate our policies against copyright infringement. Since 2012, we have ejected more than 73,000 sites from our AdSense program, the vast majority of those caught by our own proactive screens.” Testimony of Google’s Senior Copyright Policy Counsel before the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet Hearing (March 13, 2014). As with payment processor models discussed above, all legitimate ad networks similarly prohibit— by way of contractual “terms of use” or “terms of service”—the use of their services and platforms for unlawful conduct, including IP-infringing activities. 18 Reporting suggests that the enforcement of these terms of service (see sidebar) has helped root out a large volume of advertisers and web publishers who engaged in copyright infringement. Notwithstanding these contractual prohibitions, and efforts to implement industry best practices including the use of proactive screening, ad network platforms continue to be exploited by sophisticated entities engaged in widespread infringement of third-party content. Moreover, concerns about ad-supported websites dedicated to counterfeit or infringing activity go beyond the revenue loss to the content creator. Those entities engaged in the operation of such websites reportedly display malware-based ads in significant numbers that pose risks to consumers and generate income by defrauding legitimate advertisers and other businesses. According to recent reports, high-risk ads comprised of malware and fraudulent ad-revenue generation techniques (such as click generator fraud, pop-under ads, pixel stuffing, etc.) represent from 51 to 60 percent of all ads displayed on websites dedicated to offering counterfeit products and infringing content. 19 American advertising industry groups have in recent years launched several initiatives that seek to protect the integrity of the digital advertising system and of third-party content and brands from criminal exploitation by working to keep the flow of legitimate advertising dollars to the operators of legitimate websites and away from those engaged in illicit activity, including content infringement and counterfeiting. 20 Building on pledges from the advertising community, a new voluntary initiative has been launched to further dry up advertising revenue generated by traffic to websites offering infringing content. 21 Through this and other industry-led initiatives, many of the world’s largest brand advertisers and agencies have committed to take aggressive steps to keep their digital ads off these sites. 22 There remains significant work ahead, since legitimate companies continue to find their advertisements (and thus their ad dollars) inadvertently placed on sites dedicated to widespread, commercialscale IP infringement (FIG. 34). According to one report, nearly 30 percent of sampled websites in a survey of ad-supported pirate websites carried ads for “blue-chip” premium brands with recognizable household names. 23 Opportunities exist to support and expand collaboration between all stakeholders to augment these voluntary initiatives and stay ahead of the rapidly changing tactics rogue actors employ. Expanded collaboration, including by geographic scope, and enhanced sharing with the public of generalized, anonymized data on terminated accounts (such as, for example, by age of account, revenue flow to the site, geographic location of the site), 64
Office of the Intellectual Property Enforcement Coordinator FIG. 34: Example of Legitimate Advertisements Appearing on “Notorious Market” (Kat.cr). 24 can improve benchmarking of these initiatives and enable stakeholders to study and identify further opportunities to deny financial support to rogue websites. ACTION NO. 2.4: Encourage efforts to minimize ad revenue support of websites dedicated to counterfeiting and infringement. IPEC and the IPR Center (with its constituent law enforcement partners), along with other relevant Federal agencies, will convene the advertising industry to hear further about their voluntary efforts. The U.S. Interagency Strategic Planning Committees on IP Enforcement will assess opportunities to support efforts to combat the flow of ad revenue to criminals. ACTION NO. 2.5: Call for enhanced transparency. As part of best practices and initiatives, advertising networks are encouraged to make appropriately generalized and anonymized data publicly available to permit study and analysis of illicit activity intercepted on their platforms and networks. Such data will allow study by public and private actors alike to identify patterns of behavior or tactics associated with illicit actors who seek to profit from ad revenue from content theft websites. IPEC, along with members of the U.S. Interagency Strategic Planning Committees on IP Enforcement, will identify means to enhance data-driven research opportunities in the area of illicit online ad-based financing trends, tactics, and characteristics. SECTION 2 65
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U.S. JOINT STRATEGIC PLAN ON INTELL
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PREAMBLE A Reflection on Creativity
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INTRODUCTION IP-intensive industrie
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EXECUTIVE SUMMARY Services, the Dep
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ACKNOWLEDGEMENTS With thanks to, an
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