A Review Of the Ad Tech Year

by Ciaran O'Kane on 29th Dec 2015 in TRADERTALK

Earlier this year, ExchangeWire hosted ATS New York. The day started with a fireside chat between ExchangeWire’s CEO, Ciaran O’Kane and Michael Rubenstein, president, AppNexus. The discussion focussed on the future of independent ad tech companies, how publishers are fighting back against media giants and how on earth we ended up with ad blockers being commonplace.

Consolidation is driving change in the ad tech industry. Certainly in the US, VC companies are not investing in new ad tech companies the way they were five years ago. In order to survive, emerging ad tech companies, and those that may have been over funded, now need a home to survive.

Acquisitions and mergers could result in increased reliance on walled gardens and closed systems. For example, today, Amazon does not allow DoubleClick bid manager to touch their data, preferring to keep it within its own ad tech products.

This may be in the media owners’ best interests, but it is not sustainable in the long term.

Long-term success of any media owner or ad tech solution must be married to the best interests of brands – after all, they’re the ones writing the cheques. Brands need solutions that enable them to use their first party data and buy seamlessly across platforms and devices.

This year has also seen Facebook, Apple and Google change the way they aggregate news to extend their influence on the internet. Publishers need to innovate in order to keep up and maintain their share of advertising budgets.

The power of the big five is massive and increasing but the emergence of competing platforms, such as AOL is exciting and clearly signifies that this is not the end of independent publishing. Moreover, ad tech companies need to support independent publishers by helping chart a path to independence and monetisation.

A case in point is the recent advent of header bidding which, according to O’Kane “feels like a hack against DFP’s dynamic allocation”. Header bidding is actually a move towards holistic yield management, where every impression competed. Publishers are voting with their feet, according to a recent Hearst report, more than 20% have implemented a header bidding solution.

Google is now beta testing its own header-bidding solution in what could be seen as an attempt to maintain pace with independent vendors and publishers, and maintain its walled garden and the advantage they have enjoyed for decades with DFP being the dominant ad server.

Publishers are not going to be passive and continue to allow such domination – publishers need choices in the market. They need intelligence and ad tech companies that provide them with forecasting solutions for the most effective monetisation of their inventory.

Watch this episode of TraderTalk TV to hear the full discussion.