What you need to know:

• The Trade Desk is taking aim at Google, wooing publishers to join an marketplace it promises will help drive competition and value, touting a transparent alternative to the incumbent's take it or leave it approach.
• Some Australian publishers, such as News Corp welcome a "healthy" alternative, though most are cagey.
• Rival SSPs smell a threat, and are preparing counteroffensives.
• But Trade Desk, a demand-side player, insists it is not positioning to launch a supply-side platform.

Open offer

The Trade Desk has broken cover on its bid to woo publishers away from total reliance on Google while cutting the tech tax that can leave publishers with 40 cents on the advertiser dollar – or less – while providing a transparent view of costs along the chain.

Via the Open Path publisher hub the DSP is touting better value for advertisers and publishers through greater transparency.

The Trade Desk said it now has 15 major publishers onboard in the US, which includes some long tail aggregators.

If successful, the plan is to “quickly” roll out globally, including Australia this year, according to GM James Bayes, though the local market may prove a tougher nut to crack as major publishers concentrate on building their own walled gardens and marketplaces – the fledgling ‘BVOD marketplace’ is the latest example – in a bid to regain control of pricing, transparency or both.

Double-header

Some publishers operating locally welcomed the move, though questioned the integration process and the quantum of value Open Path would bring.

They cited parallels with header bidding – which for a while allowed publishers to circumvent Google’s exchange and generate more revenue by using a piece of JavaScript code that opened up their inventory to the broader market. Google is accused of killing off header bidding in cahoots with Facebook in a live US lawsuit, though denies wrongdoing.

“[The Trade Desk] is moving in a good direction. It’s healthy to have competition, which Google has effectively crushed with its monolithic ad tech platform and production systems – merging Ad Manager and AdEx into one product makes it pretty much impossible to untangle,” one publishing exec told Mi3.

“The independent tech firms are reliant on Google as an intermediary. The Trade Desk is trying to crack that. Header bidding was a huge initiative that was supposed to democratise access to publisher inventory. But Google killed it off.

“Now The Trade Desk is saying it will withdraw from Google’s Open Bidding and offer an alternative. But how they integrate with publishers will determine whether this has legs.”

While CEO Jeff Green said The Trade Desk will “turn off Google Open Bidding on its platform” as it launches Open Path, local lead James Bayes stated the initiative “is not an alternative to header bidding … Header bidding is a yield and demand management tool for publishers. The Trade Desk has no intent to develop yield management tools for publishers”.

The firm, he insisted, “is not launching an SSP” and straddling both side of the market, as Google does. But others suggest it does want 'first look' in return for bringing demand.

Given The Trade Desk is effectively going direct to advertisers on a supply-side basis, other SSPs – such as Magnite, PubMatic and Xandr  – may question that statement and are likely preparing counteroffensives to what they perceive as a land grab. Some SSPs also suggested Trade Desk's transparency pitch may be equally linked to a desire for share price growth while raising questions over conflict of interest, if it is attempting to represent both advertiser and publisher.

PubMatic Apac Chief Revenue Officer Jason Barnes said Open Path "creates yet another path to demand for publishers, increasing fragmentation in an already complex ecosystem" and suggested the market should instead focus on supply path optimisation (SPO), or cutting out middlemen rather than replacing them.

SSP Index Exchange, however, welcomed the move. "Open Path represents another choice for publishers," said Amelia Ward, Senior Director of Buyer Development for Australia and New Zealand. "A healthy ad tech ecosystem is dependent on choice, and more choice means more competition, more money in publishers’ pockets, and more value for marketer."

Same, different?

Although some publishers welcome The Trade Desk’s intent, others supply chain players questioned whether The Trade Desk is genuinely reducing complexity, or simply copying Google’s approach – only with transparency baked-in, and potentially, for a lower cut.

One specialist programmatic agency exec suggested The Trade Desk was “reading the tea leaves” and lifting successful approaches to marketplaces taken by agencies in the US over the last 12 months.

“Header bidding is not the story. It’s more that The Trade Desk has seen all of these marketplaces being created and recognised the risk that it ends up as merely a facilitator of bidding – which narrows its revenue streams and reduces its oversight on the valuation of inventory,” said the exec.

“But if it can convince people to come to its marketplace, charge a small levy [on transactions] and manage more queries per second while increasing margin on them, it hits pay dirt.”

Publishers have long complained Google takes too high a cut.

“Now The Trade Desk is saying ‘we can be an alternative option; we won’t take as much – or at least you can see what we are taking’. With Google, it is never disclosed.

“But The Trade Desk gives you log-level data on every single impression bid, served and won. You can see the time stamp on it, which gives you an audit trail – you can see what was paid to whom. So it’s just doing what Google has done, but transparently.”

Mi3 contacted four of Australia’s major publishers to gauge their appetite for The Trade Desk’s Google alternative. The only firm willing to respond on the record was News.

“If it came here, we would be interested,” said Jason Denny, GM Commercial Operations at News Corp. “We’re tech-agnostic, largely set up to be agile … and for a lot of the clients and agency trade desks that we do business with, their primary DSP is The Trade Desk. So if it benefits our clients, absolutely we’d back it.”