Yahoo and Amobee DSPs Remove Google Open Bidding as a Source of Supply

The demand-side platforms of two ad-tech vendors, Yahoo and Amobee, have removed Google Open Bidding as a path of supply for their clients, sources tell Adweek, a decision that industry experts attribute to efforts toward supply-chain optimization and a growing movement to curb the influence of Google. The move follows The Trade Desk's February decision to turn off Open Bidding when announcing the launch of its OpenPath solution. That declaration emboldened others in the ad-tech ecosystem to follow suit. Analysts point to a variety of motivations for the change, including that Open Bidding delivers redundant ad impressions, charges a 5% fee for its services and entrenches Google further into the infrastructure of the ad-delivery process. According to a February report from ad-tech consultancy firm Jounce Media, nearly 13% of all bid requests are initiated by Open Bidding, and Google’s buy-side platforms––Google Ads and DV360––have more than $25 billion in annual spending power. The technical and financial rationale for eliminating Open Bidding is clear on its own, said Jounce Media founder Chris Kane. “The main issue the industry has is not with Google Open Bidding––it’s with the duplication of bids in the bidstream,” Kane said. “And if you are deduplicating, removing Open Bidding is by far the easiest and most natural first choice.” The complexity and opacity of the ad-tech ecosystem has encouraged companies to devote more resources to optimizing their supply chains, removing sources of duplicate demand and circuitous pathways that eat into profits and widen carbon footprints. This push to cull inefficiencies has coincided with an industry-wide recognition of Google’s dominance in the space, which has attracted antitrust scrutiny from U.S. and European regulators. While Open Bidding is far from the most vital revenue driver for Google, its repudiation could signal a shift in the power balance. “What we are seeing is the slow death of Open Bidding,” said one ad-tech executive, who requested anonymity to speak freely. “Header bidding has won.” A Google spokesperson said publishers who use Open Bidding on Ad Manager see double digit revenue increases across Google's partners and exchange, citing internal data. "Over the past year, we’ve seen thousands of publishers enable Open Bidding and eight additional exchanges join the program across Ad Manager and AdMob, with continued interest from partners," the spokesperson told Adweek. Yahoo and Amobee did not respond to requests for comment by press time. How Publishers Can Lessen Their Dependence on FAANG Trimming Open Bidding optimizes supply chains By eliminating Open Bidding from their supply chain, DSPs save money without losing any opportunities. In addition, trimming these redundancies reduces the energy expenditure required to serve digital ads, said Brian O’Kelley, founder of Scope3. Despite this, many DSPs still offer both direct and Open Bidding integrations: If an exchange that enables Open Bidding partners with a top-1,000 website or mobile app, there is a 67% chance it offers both, according to the Jounce Media report. Open Bidding still has appeal under certain circumstances, said Chris Ward, the chief revenue officer and cofounder of The Publisher Desk, a monetization consultancy for publishers. Google hosts Open Bidding on its servers, which results in reduced page latency, and it offers guaranteed net-30 day payment, even if an intermediary vendor is unable to pay, according to the Jounce Media report. Some publishers also expose some inventory, such as Google Amp pageviews, only through Open Bidding, the report said. An exodus with precedent While at least three DSPs have parted ways with Open Bidding this year, others made the choice years ago. Demand-side platform RTB House removed the Open Bidding integration several years ago, when the tool was still called Exchange Bidding, vp of programmatic and ecosystem growth & innovation Lukasz Wlodarczyk told Adweek. Wlodarczyk said that not only do the fee and duplicate bids make the integration unappealing; they also make transactions harder, slower and more difficult to audit. “Every DSP sooner or later will need to do it,” Wlodarczyk said. “This is a waste on every transaction if you do not do it.” Criteo, another major DSP, has not outrightly turned off Open Bidding supply, but instead rarely finds it useful, said svp of global supply Sofia Rabellino. “Open Bidding did not and does not bring any value when you have a direct footprint,” Rabellino said. “We leave the door open and test everything, but the results are clear: It is rarely incremental.” The contentious history of Open Bidding Header bidding became prominent in the industry partly in response to Google’s dominance in ad servers. With header bidding, publishers could run auctions on multiple exchanges simultaneously before notifying their ad servers––which are, most likely, owned by Google. Before header bidding, requests from different exchanges could only be processed chronologically, which could give Google the advantage of seeing the inventory up for sale first. By allowing more demand to flow through other exchanges, header bidding meant Google’s exchange faced more competition––the company called it “an existential threat,” according to an antitrust complaint filed against Google by a group of attorneys general. Exchange Bidding (later renamed Open Bidding) was Google’s plan to defeat header bidding, per the lawsuit; it accomplished some of the same goals while also charging a fee to generate demand from rival exchanges. In a blog post responding to the lawsuit, Google said it created Open Bidding to solve many of the problems associated with header bidding, and notes header bidding has continued to grow since, including via a solution from Amazon. Google’s Ad-Tech Stack Faces Antitrust Scrutiny From All Sides