Yahoo Said To Be Considering Sale, Unrelated Report Claims Company Has Massive Ad Fraud Problem

Chris CrumBusiness

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A month ago, Yahoo announced that its board of directors had unanimously decided to suspend work on the pending plan announced earlier last year to spin off Yahoo’s remaining holdings in Alibaba. It said the board would now evaluate “alternative transaction structures to separate the Alibaba stake, focusing specifically on a reverse of the previously announced spin transaction.”

It went on to say that Yahoo’s assets and liabilities other than the Alibaba stake would be transferred to a newly formed company. In other words, Yahoo would spinoff its core web business.

Now, according to a new report from Bloomberg Business, the company is considering an outright sale. From the report:

Yahoo still hasn’t concluded that it has to sell and hasn’t hired a bank to run an official process or contacted potential buyers, said the people, who asked not to identified because a final decision hadn’t been made. Nonetheless, there has been a shift in the internal thinking at Yahoo, in part because the company and its advisers now believe they need a new plan in light of an expected proxy fight by an activist investor, said the people.

Obviously Yahoo isn't commenting.

Meanwhile, a report from CNBC has come out citing multiple sources suggesting that the company's programmatic video ad platform (powered by BrightRoll) generates "mostly fraudulent ad traffic, and otherwise does not work as promised." From that report:

One company that used Yahoo's programmatic video ad platform said it discovered 30 to 70 percent of its ads were not running in areas where Yahoo was claiming they were. Most of the problems were tied to the fact that although it was paying $20 CPMs (cost per thousand views) for pre-roll advertising (ads that appear before a video), its ads were appearing in videos inside banners, which should have only been one-tenth of the price.

Another source said that it found BrightRoll's traffic was mostly coming from data centers' IP addresses, suggesting most of the ad views were nonhuman and fraudulent.

Yahoo has commented on that bombshell, denying such claims.

Earlier this week, reports emerged that Yahoo is facing a class action suit over alleged text message spam.

So it's been an interesting week for Yahoo to say the least.

Image via Marissa Mayer (Twitter)

Chris Crum
Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.