Myth 4: There are dozens of DSPs today, and there will soon be hundreds more
False. There is no shortage of organizations claiming to be a DSP. But you can count on one hand the number of solution providers able to deliver a truly successful DSP campaign (perhaps even minus a couple of fingers). In the heyday of networks, there were reportedly more than 300 ad networks out there, but few had a significant amount of their own proprietary technology. It is the large, technology-rich networks that have successfully transitioned to become real DSPs. The rest are scrambling to rely on relationships for their technology, as they had little or no technology of their own to expose when the DSP tsunami hit our industry's shores. Because of the technology required, there will be far fewer successful DSPs than there were ad networks. Dozens? Maybe somewhere down the line. Hundreds? No way.
Myth 5: DSPs are a fad and will not have real staying power
False. Far from a fad, the DSP trend is about control, efficiency, and profitability. Advertisers never wanted to outsource all of their control; they did it for the quick scale and reach that networks provided. Now that the exchanges have matured and have exposed real-time bid APIs, control can move back to the advertisers, while retaining all of the scale and reach that networks can offer. Once we go down this road, there will be no turning back. The DSP trend is causing a fundamental change in the nature of how display media is used.
With any significant new trend, there is bound to be some confusion. Hopefully this clears the air around some of the more prevalent myths in our industry. There are sure to be more myths and many different viewpoints, but this is a start. What is certain is that the trend toward the self-service DSP model is going to have some staying power. It has already made an irrevocable impact on how display media is brokered and continues to drive upheaval. It was way back in 475 BC that the Greek philosopher Heraclitus said, "The only constant in life is change," and those words are just as true today. The display advertising industry has gone through constant change since Hotwired ran the first banner ad in 1993, and the nimble organizations will be the ones that continue to flourish.
Ajay Sravanapudi is founder and CEO of LucidMedia, an online advertising demand-side platform (DSP).
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