The AdTech Industry faces twochallenges.
A strict time constraint on the RTB bidding process and high transit costs.
During the RTB bidding process DSPs have to respond to bids within 100ms. The process of ad delivery has to be completed during the time it takes for a web page to load.
The RTB protocol is a text based protocol that can be heavy without compression. All RTB communications take place over the Hyper Text Transfer Protocol (http). The Http protocol adds to the weightof the RTB protocol.
The AdTech industry encompassestechnologies, software and services used for delivering, controlling and targeting online ads. The AdTech industry has seen phenomenal growth over the last decade and a half.
This growth is drivenby Programmatic and Real time bidding (RTB). Both technologies will account for$20 billionby the end of 2016. There are a couple of important distinctions between the two.
Programmatic ad buying isthe practice of automating thebuying and selling of digital advertising.
Real time bidding (RTB)is thebuying and selling of online ad impressions,through real-time auctions. These auctions occur in the time it takes a webpage to load.
These bidding techniquesresultin manyadvantages forpublishers and advertisers.At the same time, they contributed to making the AdTech industry more complex.It has increased thenumber of Adtech players along withthe need for interconnections among them. RTBhas also placed a strict time constraint on the ad delivery process.
During the RTB process, bids from DSPs have to arrive at the ad exchanges or SSPs between80 to 120 milliseconds(ms). This time constraint variesdepending on the ad exchange or SSP.
The time limit comprisesthe time required to compute an optimized bid. It also includes thenetwork transit time.
DSPs usually allocate 40 ms to computation time and 20 ms tonetwork congestion. This only leaves 40 ms for round trip network transit.
Each ad delivered during the RTB process requires manyback and forth requests. These requests arebetween the various AdTech companies and the user browser.
The communication happensover the http protocol which is a text based protocol. The RTB protocol itselfis a text based protocol. Both protocols add to the weight of the requests, and can lead to higher network traffic.
Datapath.io helps DSPs, SSPs and ad exchanges reduce network latency and transit cost. To understand this,we first have tolook atInternet trafficrouting.
At abasic level, Internet routing is governed byBGP (Border Gateway protocol). BGPdecides which route Internet traffic takes through anetwork. In mostcases, it sends Internet traffic overthe shortest path to its destination. This shortest pathis not always the fastest, nor is it the least expensive.
AsInternet traffic is all routed through the shortest path, these paths can become congested. This leadsto delays in the delivery of data packets. Also, BGP does notconsider transit costs when makingmake routing decisions. Transit costs can vary betweendifferent transit providers.
Datapath.iore-implementsBGPto make routing decisions based on network latency and transit cost. AdTech companies can define rules to keep latency below a certain level. Once a latency ruleisdefined, Datapath.ioscans all network routes to find one thatmeets the network latency requirements.
Once these paths have been identified they are further analyzed to determine the ones with the lowest transit cost. Internet traffic is then routedthrough network pathsthat meet therequirements.
The image above is a snapshot ofDatapath.io’s customer backend. It shows the network latency encountered through the default Amazon Web Services (AWS) route. In the graphit iscompared to Datapath.io’s optimized network routes. There is animprovement of 20%in network latency from Frankfurt to Amsterdam.
This time can beallocated to computation time to come up with optimized bids. Quicker responses also ensure that DSPs win more bids. They alsoget access to sales channels with premium ad inventory thatneedfast response times.
Using the Datapath.io low latency platform results in significant cost savings. This occurs by eliminating the need to establish manyservers neardifferent SSPs and ad exchanges.
Datapath.io also allows AdTech companies to choose network routes with the lowest transit cost. This can occurwithin the latency constraint of the RTB process. Once a network latency ruleis defined,Datapath.io automatically scans different transit providers for the ones with the lowest cost. Datapath.io thenuses those to route Internet traffic.This results in areduction to transit costs for AdTech companies.