• ClickZ, Wednesday, June 21, 2006 11 AM

Bring on the online ad exchanges: several companies are looking to bring stock market efficiency to online advertising--eBay is the highest-profile of these--but smaller players like The Right Media Exchange are also trying to address this problem. RMX attracts ad networks' unsold publisher inventory and sells that in real-time to the highest bidder, but it also buys relevant inventory on behalf of the network's advertisers. The exchange works only with ad networks; advertisers and publishers don't participate directly. In lieu of the affiliate game, which can see a publisher's unsold inventory passed through various reseller networks (who each get a cut) before finding an advertiser, RMX brings that inventory and those network advertisers together into an exchange. Not only is this more efficient, but publishers won't see two, three, and sometimes four networks taking a cut of their ad revenue. RMX works with ad networks, but it also offers tools for publishers to sell and manage inventory on the exchange, which is used by more than 50 ad networks representing nearly 3,000 advertisers and 8,000 publishers. There are other new players in the online ad exchange market; AdECN offers a similar service to RMX, but it charges a flat rate on network transactions in order to preserve its status as a disinterested third party. Executives say ad exchanges help keep ad networks honest, and they also ensure that publishers receive as much revenue for unsold inventory as an advertiser is willing to pay at the time.

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