Will Header Bidding Go Away If Google Makes A Change?

This week popped with events like MediaPost’s Programmatic Insider Summit -- which I attended -- and Mobile World Congress. The Congress was in Barcelona, so that would have been fun. But the Programmatic Insider Summit in Phoenix was also packed with great opportunities to learn, exchange ideas and points of view.

Ad blocking dominated conversations at both events, and there were a number of provocative exchanges. And at Social Media Week in New York, New York Times CEO Mark Thompson compared the use of ad blockers to stealing a print issue from a newsstand.

Thompson is thinking about banning ad-blocking readers who aren’t subscribers, which some publishers have already done. Earlier this month Wired said its tech-savvy readers can either disable their ad blockers or add Wired to the software's white list—or they can subscribe to an ad-free version of the site for $1 per week.

Putting ad blocking to the side for a moment, during MediaPost’s Programmatic Insider Summit, I spoke with a guy from a mobile SSP (supply-side platform) who had some interesting takeaways about another hot-button topic: header bidding. Header bidding allows publishers offer inventory to their programmatic partners before making calls to their ad servers which gives more buyers access to inventory simultaneously. While header bidding has great advantages to publishers which can get higher CPMs for their most valuable inventory, it's not great for Google's AdX ad exchange which has competition for inventory from other exchanges.

Previously, this mobile SSP guy was on the publisher side and implemented a lot of the set-ups for header bidding. “The holy grail was to offer your ad supply to your SSP partners equally at the same time," he said. "Unfortunately, Google’s ad server didn’t make that possible. It favored Google's AdX which wasn’t ideal because it didn’t offer genuine yield.”

This is a nuance that I hadn’t heard before.

So, essentially, this means that Google's AdX ends up getting the cream of the crop, and the preferred view of all available inventory. Google scores more dollars -- which is good for Google, but not for the Rubicons and PubMatics.

Fast-forward to the rise of header bidding -- which, in this guy’s view, has come into play to solve this problem.

This guy's take is that header biding is putting pressure on Google to make a change -- or it will have to accept the status quo, which is header bidding.  Google launched First Look for publishers, its own flavor of header bidding, not so long ago. But, my mobile SSP source says it’s not a true header-bidding solution because it doesn’t sit on the header of the page. Another limit of First Look is that, unlike header bidding, it still forces publishers and buyers to work through AdX, which could discourage demand sources looking for a more direct relationship with publishers.

Still, the bottom line is, if Google decides to make a change, all header-bidding conversations could come to a grinding halt. And then we wait for the “next big thing” in ad tech to pop.

In my source’s opinion, OpenX has an interesting private marketplace (PMP) guaranteed product that solves a problem for automated guaranteed. It’s a direct deal with a little bit of automation. The downside? There’s no data involved. But OpenX’s solution would bridge the gap between automated guaranteed and PMP-based deals.

It remains to be seen how this will shake out, and whether Google will make a change or not. Its First Look offering seems to be as close to header bidding as it can get without actually doing real header bidding. Of course one of the reasons header bidding is so popular now is because it’s been challenging, if not impossible, for publishers to get a holistic picture of demand within Google's DoubleClick for publishers.

Let's wait and see. Meantime, header bidding's not going away.

2 comments about "Will Header Bidding Go Away If Google Makes A Change?".
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  1. Tony Casson from sovrn, February 26, 2016 at 11:04 a.m.

    What kind of change are we talking about?  Publishers using header bidding are continuing to use DFP  - perhaps even more so than they did before.  Cutting the header bidding oxygen hose is a fairly drastic move involving changing DFP technology, policy or pricing, all risky.  Any action Google does take will involve creating a better product and ultimately better guaranteed performance from AdX/AdSense.  SSPs are not going to be pushed back inside the waterfall easily, so to win, AdX and AdSense are going to have to both pay more and offer more transparency.

  2. Romain Job from Smart AdServer, February 26, 2016 at 4:25 p.m.

    Google is probably monitoring this topic closely and as everybody I'd be curious to know the impact on AdX. This being I doubt that their revenue is really harmed as long as DFP tags remains on the site.
    The market is moving rapidly to programmatic guaranteed and header bidding is just unable to solve that topic: the lion share of the advertising revenue (= premium branding ads) still needs to be operated from a publisher ad server and it's probably what Google desperatly wants to keep in DFP.

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