WATERLOO, ON – Zero-rating fraudsters use 300% more data than the average subscriber if left undetected, according to data from Sandvine.
Sandvine’s new Global Internet Phenomena Spotlight: Zero-Rating Fraud report is based on data collected from an unnamed tier-1 mobile access network and examines how some subscribers on the network are using HTTP header injection to commit fraud and exploit the operator’s decision to zero-rate their website and subscriber portal.
Zero-rating is a data offering that benefits subscribers by enabling unlimited usage of one or many applications, services, or websites, for a fixed (or zero) price. This approach is often used by communication service providers to differentiate their services and stand out from the competition while providing a valuable benefit to subscribers.
(Ed note: this report comes a day ahead of the CRTC’s decision on differential pricing practices decision, prompted by complaints over Videotron's Unlimited Music. That service, a type of zero-rated plan, exempts select music streaming services from data caps under certain mobile plans.)
According to Sandvine, a small percentage of subscribers have begun to exploit zero-rated websites by using smartphone applications that masquerade as non-zero-rated traffic as if it is sourced from a zero-rated site, allowing a subscriber to avoid related charges.
Highlights from the report include:
– While only 1% of subscribers are suspected of committing fraud, they were responsible for 140 TB of total network traffic in a single month. The operator of this network believes zero-rating fraud could be responsible for 10% of total network traffic;
– The traffic composition of the suspected fraudulent traffic was very similar to the traffic composition of the region, with over 30% of the traffic being for the social applications Facebook, WhatsApp, and Instagram;
– Left undetected, the zero-rating fraud could cost the operator examined more than $7M USD each month, based on the average cost of data for their pre-paid plans.
“With growing recognition of the competitive differentiation offered by zero-rating plans, they have become much more commonplace”, said Sandvine CTO Don Bowman, in the report’s news release. “So, operators need to ensure that they are asking their vendors the tough questions on fraud prevention and revenue assurance to guarantee that their zero-rating plans are providing the full benefit to revenue that they expect.”
