Nick Terlizzi, media and entertainment advisory partner at EY, said on a press call that the three categories are more interlinked than the public might realize. A person might go to an infected website to download a movie illegally and unknowingly get malware on their computer. Those illicit programs then use their computer as part of a "zombie army" or "bot farms" to direct the computer to visit websites that the user isn't really viewing.
"This is a problem that is shared," said Sherrill Mane, senior vice president of analytics and measurement at the IAB. "This is not something that only the IAB can handle. We need the help of the marketers and agencies. We have to start thinking big and holistically."
The $8.2 billion figure breaks down into a $4.6 billion cost due to invalid traffic, with the vast majority hitting advertisers since they are paying for digital ads that are not seen by real people. About three-fourths of fake ad traffic happens on desktop devices.
Malvertising added $1.1 billion to the total. Most of the cost came from lost revenue due to ad blockers. The report suggested that at least 17 percent of people used the programs because they were afraid of unknowingly downloading viruses or other programs to their devices.
Illegal downloads took a $2.5 billion slice, mostly in lost advertising and subscription revenue. Password sharing — when one consumer buys an account and gives access to friends and family — is costing the industry about $48 million.
If all illegal content could be removed from online, the report estimated that media companies would by able to earn about $2 billion more from subscription-based models and about $456 million more from ad-supported platforms each year.