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For Immediate Release

MarkMonitor Releases First Quarterly Brandjacking Index

Report reveals cybersquatting poses greatest threat to brands, phishing and domain kiting are on the rise, and financial services and media companies are top targets

SAN FRANCISCO, April 30 , 2007 – MarkMonitor®, the global leader in enterprise brand protection, today released the company’s first Brandjacking Index™, a quarterly report that measures the effect of online threats to brands. The Brandjacking Index investigates trends, including drilled-down analysis of how the most popular brands are abused online and the industries in which abuse is causing the most damage. The report examines the ever-adaptive tactics of brandjackers such as cybersquatting, false association, pay-per-click (PPC) fraud, domain kiting, objectionable content, unauthorized sales channels and phishing.

The Brandjacking Index tracks the top 25 brands from the 2006 Top 100 Interbrand study plus additional Interbrand ranked companies for business segment analysis. The cornerstone of the Brandjacking Index is the volume of public data analyzed by MarkMonitor using the company’s proprietary algorithms; no customer data or proprietary customer information was used to create the Brandjacking Index. MarkMonitor searches approximately 134 million public records daily for brand abuse in domain data and U.S. and international Patent and Trademark Office data.

The phishing data MarkMonitor analyzes is based on feeds and fraud broadcasting from leading international Internet Service Providers (ISPs), e-mail providers and other alliance partners. The company has scanned billions of Web pages since November 2004 and processes 16 million phishing e-mails daily. To create the first Brandjacking Index, MarkMonitor captured and analyzed weekly samples of data over the month of March 2006. Insights are based on an average of weekly samples of incidents.

“Fraud, counterfeiting and other abuses against brands are increasing in intensity and numbers as brands and businesses move online,” said Rose Ryan, Research Analyst, IDC. “Protecting brand reputations, customer relationships and revenues from online abuses is becoming as important to enterprises as securing their networks, data and systems from Internet-borne threats.”

Cybersquatting Poses Greatest Threat to Brands
Each weekly sample reveals an excess of 300,000 incidents of abuse. Cybersquatting, the unauthorized use of a brand name in a domain, is the most frequent form of abuse with more than 275,000 instances recorded. Because of the strong brand association created, cybersquatting is most often combined with another form of abuse such as e-commerce, pay-per-click fraud and kiting.

“Brand holders face a double whammy – not only is the volume of these abuses significant, but abusers are becoming alarmingly savvy marketers,” explains Frederick Felman, chief marketing officer for MarkMonitor. “Brand abusers are employing online marketing techniques such as search engine optimization to siphon traffic from reputable sites. Our analysis identifies cybersquatting as a driver leading to other abuses that further degrade brand value, customer loyalty and revenues.”

More Than 40 Percent of Brand Abuse Directed at Media Companies
Analysis of eight industry segments reveals 40 percent of brand abuse is directed at media companies, both traditional and Internet-based. According to comScore, media Web sites represent 10 of the 15 most trafficked sites, validating that the most trafficked brands attract the most abuse. The next highest segments targeted include automotive, consumer electronics, high tech and financial service, each representing between 11 percent and 16 percent.

Financial Services Institutions Are Primary Targets of Kiters
A four-week average of financial kiting targets reveals more than 980 kited sites targeting financial brands, more than double that of any other segment. “Domain kiting, which is the practice of using the ICANN five-day “grace period” in a serial fashion, can be used to test the marketability of domains, so abusers utilize this technique to test traffic-diversion sites,” says Felman. “Kiting is very attractive to brandjackers as an inexpensive means to launch pay-per-click scams that trick customers and erode the strength of legitimate brands.”

Phishing Threats Increase by 104 Percent
Phishing incidents increased in Q1 2007 by 104 percent compared to Q1 2006, indicative of the adaptive nature of phishers. MarkMonitor attributes this rise in incidents to advancements in phishing technology designed to thwart phish-blocking browsers and other consumer-protection technology. In particular, one-time use and unique URL attacks are confounding traditional phish-blocking techniques.
The actual number of brands phished each month reached an all-time high of 229 in March due to optimized phishing operations and methodology, mature technology and greater economic efficiencies. “Botnets and phish kites have reduced the technology requirements and resources needed to execute attacks,” explains Felman. “Phishers are adopting direct marketing methodologies to experiment with brands, evaluate efficiencies and exploit lax enforcement.”

Phishing Attacks Against Financial Institutions Outnumber Auction Attacks
Phishing attacks against financial services companies, including large banks as well as credit unions, represent 41 percent of all phishing attacks in Q1 2007, compared to 29.4 percent in Q1 2006. Attacks on online auction brands fall below those against financial institutions for the first time, representing 38 percent in Q1 2007. “This rise in attacks on financial institutions is not surprising,” says Felman. “The yield for online banking credentials is incredibly high for phishers. They are taking advantage of the large number of mergers and acquisitions as well as the ongoing shift from brick-and-mortar to online banking. Customers are confused and the phishers are capitalizing on it.”

“Criminals have learned the rules of online marketing and how to exploit the system to attack the brands, revenue streams, channels and reputations of legitimate companies faster than businesses have migrated from physical security models to the cyberworld," says Irfan Salim, president and chief executive officer of MarkMonitor. “Brandjackers are adaptive, security savvy and opportunistic. By issuing our quarterly Brandjacking Index, it is our goal to raise awareness and arm brand holders with key information needed to protect their brands and stakeholders from the latest online threats.”

Note to Editors

For complete Brandjacking Index results or more information concerning methodology, contact Te Smith at 831-818-1267 / te.smith@markmonitor.com or Jonathan

About MarkMonitor

MarkMonitor, the global leader in enterprise brand protection, offers comprehensive solutions and services that safeguard brands, reputation and revenue from online risks. With end-to-end solutions that address the growing threats of online fraud, brand abuse and unauthorized channels, MarkMonitor enables a secure Internet for businesses and their customers. The company’s exclusive access to data combined with its real-time prevention, detection and response capabilities provide wide-ranging protection to the ever-changing online risks faced by brands today. For more information, visit www.markmonitor.com.

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