And All That Could Have Been

Welcome to a flash-installment of GHAT, which overrode my scheduled programming (me complaining about Curation, which you will all get in a week or two), as I think this is a time-sensitive article that everyone should read.

I want to talk about what the world would be like without GAM.? There’s a non-zero chance that GAM and ADX will be separated by uncle sam, and I believe that this could be the beginning of the end of GAM.

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My reasoning for this is that 95% of the people using GAM don’t actually need it.? And the remaining 5%, Prebid could build a competitor that displaces GAM in a matter of months, with the actual migration process taking 3-5 years.

This is not to say that Prebid could function as an ad server right now, per Tom Kershaw’s testimony for the DOJ it is missing a bajillion core features.? But those features are missing not because they’re impossible or even difficult to build in a superior way to GAM, rather because nobody at Prebid wanted to waste their time building something that very few people would use.? Hell, we BUILT one of the core ones, even though I was bitching the whole time that no one would use it.

So, without further ado, the world without GAM.

First, The History

The concept of the publisher ad server is ancient.? In a training I gave all of my RTK employees, and maybe even had a training video or two on back at AppNexus, I discussed the emergence of the ad server.? In a sentence, the ad server is an abstraction layer that serves to swap out, target, and count the ads on publisher websites without an engineer having to change the ads on that website manually.

This needed to exist in 2005 because many things were direct sold (ie. the publisher made a deal directly with an advertiser), and things that weren’t direct sold went out to Ad Networks that weren’t interconnected.? The Ad Server lived, thrived, and was necessary in a world where the systems didn’t actually communicate with one another.? Rather, you ping ponged advertising impressions from system to system using javascript tags resulting in client side redirects, and every advertising system had its own internal economics that weren’t exposed to other systems.

This Began To Change With RTB

The first RTB systems, and I’ll just go with Right Media for this, changed the game by allowing networks to expose their economics to one another – in a simple sentence, instead of ping ponging advertising opportunities between one another with no communication about price, they could bid into one another’s advertising opportunities.?

This concept, of one advertising ecosystem (ie. a network) bidding into another advertising ecosystem is the foundation of modern ad tech.??

The trajectory looks like this :?

Phase 1 - Early RTB (RMX, AdECN)

A single platform that houses multiple ad network entities.? These ad network entities leverage the platform itself to bid into one another.

Phase 2 - Inter-Platform Bidding / OpenRTB Emergence

Instead of the various participants in the advertising auctions being housed within one platform, we develop technology for platforms to communicate with one another.? This is when the concept of the DSP and the SSP emerged, and OpenRTB attempted to standardize the communication between those companies.? Ad Exchanges are born here.

Phase 3 - Header Bidding

Header Bidding applies the same bidding theory that existed for Ad Networks (now called DSPs and SSPs) to a level of abstraction lower, within the publisher monetization stack, previously the exclusive purview of the ad server.? Various Ad Networks now participate in a meta-auction at the publisher ad opportunity level, where the bids they get from their technology platform partners are passed along into an ultimate publisher level auction conducted by a javascript client side header bidding framework.? Currently, but not necessarily, this then gets pushed into GAM.

The difference between Phase 3, where every system is capable of communicating live bids to one another for every single ad opportunity, and Phase 0 where the ad server was born, is tremendous.??

In a world where every system is capable of bidding, Publishers without direct sales truly don’t need an ad server.? This is 95% (or maybe 99%?) of publishers. ? And to be clear, this means that 99% of publishers who are using GAM are only using it because adx is the only participant in this supply chain that refuses to bid into other technology platforms.

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So, in light of this, I’d like to describe Phase 4 - A world without GAM

In a world without GAM, we centralize all direct sold and programmatic inventory into a unified, single on page auction.? Let’s make this auction perfect – here we go –

Step 1 – Inventory Definition

I’ve written about inventory definition in other articles, it’s how a publisher labels the inventory they have available.? Publishers shouldn’t be responsible for this.? Publishers should put ads where they want them to go, and then an automated system like Adelaide or Contextful or some other startup that I’m an advisor to (feel free to hit my dms) dynamically labels the inventory in a way that gives it stable, predictive performance value for advertisers.

Step 2 - Publisher First Party Data Addition

Publishers use first party data already for all kinds of stuff – typically communicated into GAM via key-value pairs.? In Step 2, the publisher appends this first party data to the various ad holes on their website, and also uses the Prebid Real Time Data Module to append any other data from its vendors to the upcoming advertising auctions.? This is standardized, and all enriching data for this ad advertising opportunity is appended here in a single step.? Publishers can exert control over who sees what data, or they can blast everything to everybody as they see fit. This almost entirely exists today in Prebid.

The reason things aren’t all consolidated here is primarily because OpenRTB also has to get its shit together regarding taxonomies for this stuff, and DSPs need to start ingesting and optimizing to the data fields more flexibly and stop driving people to use PMPs for dumb shit (article to follow next week).

Step 3 - Live Auction For Inventory

Requests are sent out for bids.? In this Platonic future, the publisher has two sets of bidders.??

1. Direct Sold – they’ve configured a bidding platform with their direct sold campaigns, they can use a DSP for this.? Using a DSP actually has meaningful benefits, as their campaigns will be able to simultaneously target O&O inventory and do audience extension in a unified way (appnexus can already do this, and has been able to for over a decade).? DSPs are also fantastic at outcome optimization.? GAM is terrible at or incapable of both of these things.??

DSPs already have access control management, the concept of teams, and the ability to create tremendous hierarchy in their uses that is almost always superior to GAM’s ridiculous Teams feature.

We would need to introduce the concept of priority level (ie. guaranteed, p1-1000, etc), but that’s not super complicated and with the right incentives DSPs will build it quickly under the tutelage of a knowledgeable sell sider.

2. Programmatically Sold – all programmatic bidders compete in a unified auction.

In addition to the DSP housing the managed campaigns, the publisher has all of its other bidders.? Ad Exchanges, DSPs who are now going Prebid Direct, you name it, everyone can participate in a single unified auction with modular implementation.? Prebid Server becomes a big deal, because it provides basically infinite biddable scalability with zero latency impact.

Step 4 - Delivery

Prebid now renders the ad to the page directly.? This saves us around 800ms of GAM doing bullshit, making ads across the internet perform better, and also exposes the auction dynamics via Open Source, so it literally becomes impossible for anyone to engage in shenanigans.

Fin

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This is Ad Tech 3.0.? Let’s Make It Happen.

Feature disclaimers

Forecasting, or a tool to help publishers plan their direct sales, is something easily built as a plug-in to Prebid.? In fact, forecasting coupled to an ad server sucks, if it were in Prebid you could have multiple forecasting vendors compete with one another and pick the one you liked best.? It would be epic.

Ad Quality Controls for Publishers? – easily accomplished by prebid, in fact I’m pretty sure Prebid is carrying this football forward and its always been one of my pet projects.? This would objectively work better in Prebid than it does today.

Anything else an ad server can do Prebid could do better.

Secondary Benefits of Ad Tech 3.0

The Industry Grows Like a Mofo – using Prebid Server, anyone who wants to start a DSP can buy directly from any publisher using Prebid in a biddable way with trivial integration costs (zero latency cost, the cost of additional fanout in server, and prebid server could really easily add a throttling methodology for testing new bidders to control costs).? We have tremendous new competition in the DSP space, because Ad Exchanges go away.? Fewer Middle Men.? This has a bajillion benefits.

Publishers Make More Money – by reducing auction latency, and making it much easier for bidders to integrate directly with publishers, and by simplifying the competitive workflows, Publishers undoubtedly make more money in this scenario.? They have more competition for their ads, they have more transparency, and they own their future.

Advertisers Get Better Results – better data, communicated in a standard way, with better transparency on the auction methodology.? Campaigns work better, more people spend money on the open web.

This would possibly save internet publishing.? It would certainly make everyone more money.? And there’s only one thing stopping this optimal outcome from happening –

ADX DOESNT BID INTO PREBID.

Thanks for coming to my Ted Talk.? Happy Antitrust. Also I won’t hold my breath

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