SSPs are Dead.

Admeld. Dead.

Pubmatic. Dead.

Rubicon. Dead.

Niedermeyer. Dead. (anyone?)

SSPs (supply side platforms) began to emerge in 2007 to help large publishers “YIELD OPTIMIZE” demand from ad networks—all 400 of them.

It was a great pitch: Mr. Big Publisher, you utilize 20-70% of your inventory to make 80% of your revenue from direct sales. Let me manage all the second channel (remnant) demand via ad networks—you’ll make more because I the SSP know how to “YIELD OPTIMIZE” among this crazy world of 400 ad networks.

The YIELD OPTIMIZATION business—the reason for the creation of SSPs—is Dead. Finito. Over.

Ben, Rajeev, Frank—before you lunge for the phone (or lunge at me), I’m actually going to explain to everyone your bright future. Bankers please get your pencils ready.

SSPs are now Exchanges. There has been a buzz word merger. Someone tell Terry Kawaja so he can adjust his bubble chart (bubble chart, get it?).

Effective immediately all digital media executives are to cease and desist all usage of the acronym S.S.P. and use the fully formed noun “Exchange”.

Optimization has moved to the buy side.

Real Time Bidding enabled supply (otherwise known as Exchange) allows all RTB buyers—ad networks, DSPs, agency trading desks—to bring their own optimization to the table. RTB caused the death of SSPs and their emergence as exchanges.

In fact at a recent conference, Admeld’s own Ben Barokas said his business has shifted from 15% RTB/85% YIELD OPTIMIZATION in January 2010 to 54% RTB/46% YIELD OPTIMIZATION in January 2011. At best, yield optimization is a legacy business among SSPs.

OLD: SSPs
Admeld
Pubmatic
Rubicon

OLD: Exchanges
AdX (Google)
CONTEXTWEB
OpenX

NEW: Merger to Exchanges—all RTB Enabled
Admeld
AdX (Google)
CONTEXTWEB
OpenX
Pubmatic
Rubicon

Google did not buy Admeld the SSP for $400 million. Google bought Admeld the Exchange for $400 million.

See my earlier post Google, Admeld & The Need for Diabolical Liquidity.

What do you think? Leave a comment below or contact me.

[These views are my own. If you want to speak with CONTEXTWEB in regards to RTB, go here.]

Thanks to DOH for the movie reference.