Global ad marketplace Index Exchange has been outed for bid caching for more than a year before making media buyers aware.
In addition to a blog post where Index Exchange came clean on bid caching, CEO and president Andrew Casale has sent an email to staff and clients expressing his regret in not being transparent sooner.
"As CEO, I am writing today to express my disappointment in our company’s level of transparency regarding the roll-out of this enhancement," Casale said, adding that all bid caching has been paused for the time being.
Bid caching, which involves holding onto a bid when a buyer loses a programmatic auction and then trying to use it to serve an ad moments later in a piece of content, has allowed Index Exchange to gain market share and deliver higher CPMs to publishers, but has angered media buyers and rival exchanges, according to AdExchanger.
Speaking to AdNews, one industry exec described it as a 'predatory pricing technique', whereas Casale deems it to be more of an 'innovation'. See: Behind Index Exchange's 'predatory pricing technique'.
Check out the full email to Index Exchange's partners below.
Transparency has always been foundational to Index Exchange’s core mission. We take sincere pride in our hard-earned reputation as advocates for higher standards of practice in our industry. At the same time, we also maintain an abiding commitment to delivering consistent innovation to the market, often moving faster than our competitors.
Bid caching represents one such innovation – one that addresses a real problem with an intelligent solution. As CEO, I am writing today to express my disappointment in our company’s level of transparency regarding the roll-out of this enhancement. And while we see this as a compliant and elegant platform-level solution, we should have more pro actively and more vigorously communicated its arrival to our platform as a feature.
We maintain that bid caching is a smart innovation that enhances our partners’ ability to achieve their outcomes when latency presents a barrier. Reduction of latency is an industry-wide problem, and we will continue to pursue innovative solutions to reduce it in order to improve user experience.
However, as a reflection of our commitment to openness, we are pausing our use of bid caching and shifting our focus to communication and education. We are also updating our product release practices and commercialization processes, and we will seek to further advance exchange mechanic standards, as a beacon for the industry.
We believe that once the ecosystem is fully informed about this additional option for the marketplace, many partners will make the choice to leverage/activate this feature.
In the meantime, we will use this opportunity to recommit to an even higher standard of transparency for our industry.
President and CEO
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