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Online Advertising Business 101, Part VII: Demand-side Platforms (DSPs)

It turns out, alarmingly, that it’s been over a year since my last Online Advertising Business 101 post. And a year is an awfully long time in the world of online advertising. Long enough, in fact, for an entirely new kind of company to emerge and become the next big thing. I’m talking, of course, about Demand-side Platforms. You’ve heard of them, I trust? No? Then read on. DSPs, RTBs, oh my As it should happen, my last post in this series was on the subject of Ad Exchanges – a new kind of participant in the advertising value chain that acts as an intermediary between ad networks, allowing them to exchange inventory to make up for shortfalls in supply and demand among their own publishers and advertisers, and also allowing other scale players (e.g. big advertisers like eBay, or a big agency) to buy inventory dynamically across a number of different networks. All those folks had to do was implement some technology to interact with the exchange, and place bids in real-time (on of the key characteristics of an ad exchange being that it can auction inventory in real-time). It turns out that that last glib sentence conceals an…

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