Google Cuts Off AppNexus Access To Real-Time Inventory On Adx, As It Looks To Close The Loop
by Ciaran O'Kane on 1st Dec 2010 in News
Peter Kafka reported last night that Google has cut off AppNexus from its RTB inventory on Adx. Google has cited the protection of users and publishers as the primary reason, insisting all buyers trading through the AppNexus platform must have a seat on its exchange. Here's part of the statement put out by Google:
To protect users and publishers, the Ad Exchange has extensive, widely-published policies for a range of issues including ad quality, ad content and malware. We have technologies to detect violations, and when a customer is in breach of our policies, we take action, including potential suspension from the Ad Exchange. AppNexus is a great partner, and we’re working with them through this issue to get them back on the Ad Exchange.
Excuse me now as I look to dissect Google's beautifully crafted PR. This is utter rubbish. Google knows that taking this position will result in a vetting process that will take a couple of weeks to sort out. And in the real-time buying world that's an eternity. What's the result of this: AppNexus clients will have to jump ship, as many are probably in the middle of big campaigns running up to the Christmas period. And who will benefit the most? Why, Invite Media.
This really is depressing news for the space - and dangerous for everybody working in it. Google owns every piece of the eco-system, and is now looking to leverage its considerable tech might to make Invite the de facto DSP. Remember Google also has a managed service, and without any real DSP competitor it leaves agencies without any point of difference. That ultimately gives Google a free run at their clients in two-to-three years’ time when the majority of display becomes automated. This is a fact. Google says it wants to help agencies - but it is ruthless. Without any real competition on the buy-side space it will eventually eat the agency - and ad network - layer alive.
I expected this would happen at some stage but Google has done this in the middle of an EU investigation into anti-competitive behaviour in its search business. It's getting to the point now where it is becoming too dominant and too powerful in the display space. There is no law against operating a monopoly, but there certainly is legislation against anti-competitive behaviour. And whatever way you tart this up (malvertising, etc), this appears to be the case here.
Maybe, as John Ebbert alludes to in his post, other inventory sources should shut Invite Media out. Interesting. But I think that will ultimately play into the hands of Google, which owns much of the infrastructure that facilitates automated ad trading. I think this is fast becoming an issue for regulators. The EU should now be casting an eye over Google's position in the display market – and ensuring it does not engage in anti-competitive behaviour that benefits Google's already powerful position.