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Some of the biggest US internet companies have launched an attempt to bolster confidence in the “click-based” advertising system that has become the industry’s biggest money-maker.

Concerns about fraud and other potential abuses of the system have become rife.

The Interactive Advertising Bureau, a trade association that represents Google, Yahoo and other leading online companies, said it had set up a working group to try to standardise the way mouse clicks are measured and interpreted.

Charging advertisers each time an internet user clicks on their message has become the basic approach behind a growing part of online advertising, and is at the heart of the search-engine advertising systems run by Google, Yahoo and Microsoft.

However, internet companies have been besieged by inquiries from advertisers who are concerned that some clicks are fraudulent and designed only to generate a payment.

A court-ordered study on Google’s system for measuring clicks also found last month that there was a lack of agreement on how to interpret the behaviour of internet users who often click on the same ad more than once.

Advertisers have complained about a lack of transparency and accountability in the click-based advertising system.

Internet companies do not disclose how they measure which clicks they charge for, out of concern that this would lead to greater fraud, and their systems are not audited.

George Ivie, head of the Media Rating Council, a self-regulatory body in the US that oversees all media measurement systems, said he expected his agency to begin auditing as a result of the review.

The IAB initiative is designed to “set standards so [click-based advertising] is ready for prime time,” said Greg Stuart, the group’s chief executive officer. “It is putting trust and credibility into the medium now it has matured.”

The growth of online advertising has strained the normal processes for setting industry-wide rules. The IAB’s efforts to produce standards to govern how advertisers measure and charge for internet advertising are likely to take six to eight years to complete, said Mr Stuart.

Other aspects of online measurement still to be standardised include the way internet companies count the “unique visitors” who visit their websites. The IAB plans to tackle this after it completes its work on clicks, said Mr Stuart.

It has already produced a standard to govern the way that internet companies count “impressions”, or the number of times that adverts are seen by internet users.

Copyright The Financial Times Limited 2017. All rights reserved.
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