With 'justice league' exchange shelved, Fairfax, Mi9 and GroupM's Xaxis sign up to AppNexus

By Brendan Coyne | 18 March 2014
 

Programmatic ad platform AppNexus officially launched in Australia today with an office in Sydney putting a presence on the ground to match clients including Fairfax, Mi9 and GroupM trading desk Xaxis.

It's not a 'lite' version of the premium publisher 'gang of four' exchange heavily trailed last year before being scuppered when Yahoo!7 and New Corp pulled out. But it could lead to some interesting premium opportunities for publishers. Another of the founder clients is Big Mobile.

AppNexus is backed by Microsoft, among others, plus lots of venture capital firms as well as Marc Andreessen, Ben Horowitz and Ron Conway. It was founded by Brian O'Kelley, the man behind the Right Media platform that was subsequently sold to Yahoo! for $850 million.

It was set to be the platform provider for the mooted "justice league" exchange, which progressed to the stage that a joint venture company was set up. How the involved companies, fierce rivals, extricate themselves from that venture could prove interesting.

It is thought that the idea in its original iteration will struggle without the scale of the other two big players. Mi9, one of the most bullish behind that idea, said that AppNexus would be the only platform it uses to lead the market to full programmatic adoption across channels and hinted at other opportunities for premium publishers.

"We are also looking to partner with AppNexus further in the rapidly growing mobile and tablet ad space," said Mi9 commercial director Marc Barnett.

David Osborn is vice president for sales Asia Pacific, and now based in Sydney. He refused to be drawn on any detail about the previous attempt to bring together publishers, nor whether AppNexus would go into video in future. He stressed that the company's focus for the last year had been desktop and mobile.

"Video is not an area that we do today and I don't want to go into future product plans. We are really focused on desktop and mobile," with mobile a particular focus in the last year.

That opportunity is "significant in Australia. It comes up in almost every conversation, both on the supply-side and the demand side. One of the areas we are interested in is what will serve as a catalyst for really launching a mobile marketplace. That is an open question. But thirty percent of digital consumption is happening on mobile. It's a very interesting area for brands."

Acting as both a demand-side platform (DSP) and a sell-side platform (SSP), Osborn said that AppNexus' record with publisher and trading desk clients showed that there was no issue about 'clipping two sides of the ticket', as programmatic players who serve one side or the other use as beating stick for those that do both.

"We connect buyers and sellers together, help advertisers get the most return for their dollars and help publishers get the most out of their unique content. Which is also good for the consumer because it encourages publishers to continue to create better content."

Osborn added that the data management platform (DMP) aspect of its solution meant that its platform sat between the buyer and the seller so that "they can trade in any manner that they want" while maintaining security over assets. "The seller specifies rules as to what the buyer can and can't see, the buyer sets out what it did and did not want to target. They set out the rules, we enforce them."

Xaxis Australia operations director Timothy Whitfield said the reason the GroupM trading desk made AppNexus a preferred partner for display was because it "allows Xaxis to get access to all premium Australian inventory that is purchased via the GroupM trading agreements. Second, the AppNexus platform is fully integrated with the Xaxis DMP, which is unparalleled in the Australian market. Finally; AppNexus’ industry experts have boots on the ground here in Sydney".

The data aspect, he said, was critical. "It means any of the publishers that use the AppNexus platform, we can programmatically purchase against data in their DMP as opposed to ours. That is good, because it gives a balance between accountability and control."

"That means we can open up inventory overlaid with data. Data and inventory equals audience. Our goal is to continue buying audiences and stop buying inventory. No more pay and spray."

On consolidation in the increasingly crowded programmatic market in Australia, Osborn again would not be drawn. He said that AppNexus chose an open platform, where industry connects via APIs so that "all parties can flourish and clients can connect with anyone they chose. So I don't know about winners and losers ... but our clients [have that flexibility]."

Neither would he hang a number around his neck for staff headcount in Australia, suffice to say he's hiring. "But I have been impressed by the calibre of people in the marketplace both on the technology and the publishers side. So I could see why there is a lot of competition for them.”

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