The fraud risk in OTT and CTV isn’t going anywhere soon.

By Katie Jordan Green, Christine Formenti and Carrie Tiz from C-K’s Strategic Audio Video Investments (SAVI) Team

Fraud is nothing new in the fragmented OTT space. As OTT offerings and the amount of applications – and advertising dollars – grow, so does the room for fraud. One thing to remember is that connected TV (CTV) is still a relatively newer player in the digital advertising space, which means it doesn’t have the set standards other platforms have in place. Yet. Remember when digital advertising began and was referred to as the “Wild West?” This is where both OTT and CTV are now.

The rise of app development for OTT has put supply-side platform (SSP) aggregators under pressure to determine what content is truly premium. However, when it comes to CTV as a device, the cookie-less environment currently makes it too volatile for vendors to be able to monitor and block fraudulent impressions.

While the industry has called for standards to help combat this fraud, we don’t foresee a fool-proof solution coming any time soon for either OTT or CTV. Even with DoubleVerify, IAS and Moat’s new verification platforms set to enter the stage in Q1 2020, brands shouldn’t feel protected until the products are tested and mature.

With the rise of cord cutters, brands may consider the OTT environment to be valuable in the quest to find incremental reach on top of linear TV.

Here are safeguards that should be implemented to alleviate the possibility of fraud in OTT:

• Consider subscription ad-supported (AVOD) platforms like Hulu, Sling and DirectTV or free ad-supported VOD partners like Tubi or Pluto. This inventory is owned by the vendor and is verified to be secure.
• Require vendors to provide documentation of apps and sites from which they’re accessing inventory to cross-reference problem areas.
• Confirm partners have first access to publisher content to ensure the inventory is coming from a reputable source.
• Align with partners that allow ad-verification tagging. This applies brand safety guidelines to inventory that runs on devices that are trackable by verification partners.

Better fraud protection will come as detection capabilities improve, but that change will only come as agencies and brands continue to push vendors to higher standards. It’s the only way to force a change. The industry is working in the right direction, but choose publishers wisely until DV, IAS and Moat have case studies and reliable data to show they’ve cracked the code to limiting fraud from showing up as an inventory option.