Comment by paulsutter | Hacker News Reader

Comment by paulsutter | Hacker News Reader

Microsoft bought aQuantive as a knee-jerk reaction to Google's acquisition of Doubleclick. It was comical at the time because

- aQuantive's Atlas was a distant number 2 to Doubleclick's DART in terms of ad server market share

- aQuantive had no plans to create an ad exchange, nor did their market share make that a credible possibility, and

- Microsoft somehow paid twice as much for aQuantive as Google paid for Doubleclick.

All told it was a bewildering acquisition. Either Microsoft didn't understand why Google bought Doubleclick, or Google corpdev did a masterful behind the scenes headfake with regards to the value of aQuantive.

Yahoo at least understood what the DCLK acquisition was about and bought Right Media. Of course, an open ad exchange is basically at odds with Yahoo's premium inventory direct sales strategy, so it has been difficult for Yahoo to really make it successful.

In the end the whole episode was a giant win for Google, and an embarassment for MSFT and YHOO.

> Microsoft bought aQuantive as a knee-jerk reaction to Google's acquisition of Doubleclick.

Sometimes blindly copying your competitor isn't the best idea.

But, had msft executed, there definitely is room for competitors for both dfp and dfa. Many pubs seem to want something, anything besides dfp. Plus the rise of ssps is (maybe?) a reaction to the pub adservers not innovating. For god's sake, openx (written in php!) is being used by pubs.

also, hi (earl from qc)

Could you maybe explain some of those acronyms you used?

DFP: Dart for Publishers http://www.google.com/doubleclick/publishers/dart.html

DFA: Doubleclick for Advertisers http://www.google.com/doubleclick/advertisers/dfa.html

SSP: Supply Side Platform http://www.adopsinsider.com/ad-exchanges/supply-side-platfor...

Open X: Open source tool for managing ads on your website http://en.wikipedia.org/wiki/OpenX_(software)

Sorry dude.

When a publisher (pub) sells ad space to an advertiser, there are at least two sets of servers involved. There is a publisher / sell side ad server (pub adserver) which picks which ad to show in an inventory slot on a page view and generally tries to optimize for the publishers income, plus does publisher side reporting. There is a advertiser / buy side ad server which does cross publisher reporting; allows the advertiser to control, change, and update creative; tries to do frequency capping; tries to do cross channel reporting; and tries to optimize on the advertisers' behalf. These are generally not the same server. Google's ad server were basically purchased from doubleclick. DFA is doubleclick for advertisers and DFP is doubleclick for publishers. Openx is a competing publisher ad server. Atlas is microsofts advertiser ad server; it competes with dfa.

An SSP is a supply side platform. It's a service that basically replaces a pub ad server and attempts to get as much money for the pub as possible by switching between ad networks and possibly trading off between guaranteed, network, and rtb. It basically is a saas stack that replaces a publisher ad server. An SSP will often also attempt to prevent first party data leakage.

a DSP is a similar beast for the demand side and can start to replace an advertiser ad server.

From my perspective (and I think many pubs) there hasn't been much innovation between dfp and openx. Hence the movement to SSPs.

First party data is, in a nutshell, the fact that a user visited a site or a page. From this you can derive all sorts of things such as the purchasing interests of the user.

guaranteed is presold ads, the most lucrative for a publisher

Thanks for the explanation! Having never dealt with internet advertisers I didn't realize there was as much to it as there is :)

dfp = DoubleClick for Publisher (helps publishers run the ads that advertisers buy)

dfa = DoubleClick for Advertisers (helps advertisers buy ads)

OpenX was an open source ad serving platform you could install on your own server, but AFAIK the company behind it has more-or-less killed the open source product and is instead pushing a closed-source hosted ad serving solution.

OpenX Enterprise is definitely being pushed hard. They also continue to work on OpenX Market, their exchange.

OpenX is not good, but yeah a good number of people are using them.

I'm not surprised that many people use OpenX -- I'm surprised at how little competition there is for ad servers.

Last year I wanted to build an ad server that could integrate with legacy backend systems and add some custom targeting logic, but I couldn't figure out a good way to do it. All the popular ad servers are either crappy, too limited, too expensive, or some combinaton of the three.

http://www.adzerk.com/ seems to be the only real upstart in the game, as far as I can tell.

My view is that the ad server business itself isnt a great business. The strategic value in Google buying Doubleclick was the market share of publishers firmly locked into Doubleclick as a platform, with all their ads flowing through that platform, and the corresponding opportunity to lock all of that inventory into a big ad exchange.

The strategic value of market share is huge when establishing an exchange. Exchanges are the purest network effects businesses that exist.

I agree that DFP and DFA aren't well loved by anyone. Im not even sure if the folks at Doubleclick love the product. But switching ad servers is as difficult for a publisher as changing keyboard layouts would be for you and me. Your whole process, and training of all your ad ops people just gets locked into the system you're using. This lock in is probably what makes it so hard to improve the product. But this lock in is what made Doubleclick so valuable to Google.

Google isn't the only smart operator in this space. Brian O'Kelley at AppNexus simply out hustled all of them to build an platform as important as Google's by linking all the exchanges together. Funny since he was of course CTO at Right Media.

(hey Earl!)

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