A New Meaning for Real Time Bidding: An artist's guide to how the brands and ad agencies profit from advertising supported piracy

From Advertising Perspectives: “Are Ad Exchanges and Real Time Bidding the Next Big Thing” (http://www.advertisingperspectives.com/adblog/media-technology/are-ad-exchanges-and-real-time-bidding-the-next-big-thing/)

“The evolution of the technical infrastructure supporting display advertising is all the more interesting because this tech stack conceivably is applicable to other media types as well. Imagine video on whatever screen supported by ads delivered with this technology…”

Right.

As this diagram shows, it is very unlikely that the ad agencies who represent brands are not aware of the delivery to pirate websites of advertising by the brands the agency is trusted to promote.  As I was told by one brand, there are “millions” of transactions.  This is usually presented as a reason for why the brand can’t be responsible for their ads appearing on pirate sites instead of a reason for why the entire system is ineffective and rancid.  If you made a car that exploded, would you escape liability for any one of them because you made millions of them?

Because, you see, in order to achieve the all-important scale, the brand relies on that first box “Target and Rules” as their fig leaf to avoid liability for money laundering, but real time bidding for ad inventory seems to make it far more likely that the brand or its agency are in on the scam:

Real Time Bidding is a dynamic auction process where each impression is bid for in (near) real time versus a static auction where the impressions are typically bundled in groups of 1,000. The potential advantages are cost efficiency, higher performance and greater granularity with targeting and measurement.

Or said another way–actual knowledge of where the ad ends up.  The “rules” step is very important to the brand and its ad agency (as well as ad exchanges like Google AdEx) because as long as everyone lies, everyone in the chain is theoretically insulated from claims that they knew where their ads are showing up because they can always blame the next guy in the chain and the system doesn’t provide sufficient information to the agency or the brand to make it easy to nail them.  (See also Professor Ben Edelman’s 2009 article, “Toward an Advertiser’s Bill of Rights” a remarkable article that appears to identify rights that advertisers would prefer not to have as there has been remarkably little progress made toward accomplishing these simple corporate governance objectives for an ethical system.)

This is why the screen shots are so important–when provided a screen capture of their ad on a pirate network, the brand cannot deny knowledge.

And who runs the big ad exchanges?

Yahoo’s Right Media was arguably the first out of the gate with an exchange. With broad reach across the Yahoo network it is well positioned and has recently committed to offering more premium inventory.

Google AdEx leverages the DoubleClick Ad Serving platform with [Real Time Bidding]. As is typical with Google, the technology stack is the most sophisticated of the top tier exchanges.

AdMeld helps premium publishers maximize revenue from their ad inventory,  reduce operating costs and eliminate unwanted ads  by giving publishers access to demand from ad  networks, exchanges and DSPs.

AdBrite is an advertising exchange   focused targeting and optimization, has  real-time  bidding, API functionality and a self-service account management  interface.

You won’t be surprised to know that Google and Adbrite are identified in the Megavideo indictment as supporting the company in its formative years (alongside, curiously enough, Creative Commons fans Partygaming).

So when you see the complexity of the ad exchanges and real time bidding, you can understand why Google wants to “follow the money” because it is nearly impossible to do and essentially is impossible to do for an independent artist or even a major record company.  We don’t need to follow anything because once we get the screen capture, we know where the money starts and we know where the money stops.

What happens in between just adds time to their sentences.

Gives “real time bidding” a whole new meaning, right?