LONDON: The adtech industry, already under fire over brand safety, faces a battle on a new front as the Guardian has begun legal proceedings against Rubicon Project "for the recovery of non-disclosed buyer fees in relation of Guardian inventory".
The media owner's move could potentially be the first of a number of similar actions as advertisers and publishers increase the pressure on adtech players to be more transparent in their dealings.
"Advertisers are losing out because they're not getting their money's worth. Publishers are only getting 40 cents on the dollar," noted Nick Manning, chief strategy officer at marketing analytics firm Ebiquity.
"It's the intermediaries who are making money here, selling impressions whether they are real or not," he told Campaign. "It's not surprising, therefore, that advertisers and publishers are starting to question the economics because it's not working for either of them."
Hamish Nicklin, the Guardian's chief revenue officer last year revealed that when the newsbrand had purchased its own ad inventory in an attempt to track where the money was spent across the digital supply chain, in some cases as little as 30 pence in the pound was coming back to the publisher.
Chairing a panel at Advertising Week Europe last week, Nicklin was critical of "the prevailing wisdom of what digital paradigms should be, regardless of what your marketing objectives are" – a state of affairs he laid squarely at the feet of the Google and Facebook.
"Quality, premium, safe environments – those are metrics and factors that are completely ignored in today's ecosystem," he said. "It is all about cheap low cost audiences at scale because it benefits the two people who can shout very loudly about that being the way forward."
On the same panel, Tony Katsur, president of direct audience platform Sonobi, attacked the "degrees of obfuscation" in the current ecosystem and warned advertisers that they "need to be more involved with the technology they leverage".
Rubicon Project disputed the Guardian's allegations, saying the claims amounted to a contract dispute which it would contest in court.
"We charge buyer fees for certain services we provide and have disclosed that fact publicly," it said in a statement. "Without buyer fees we would need to charge sellers more, and we think our approach is fair."
The media owner's move could potentially be the first of a number of similar actions as advertisers and publishers increase the pressure on adtech players to be more transparent in their dealings.
"Advertisers are losing out because they're not getting their money's worth. Publishers are only getting 40 cents on the dollar," noted Nick Manning, chief strategy officer at marketing analytics firm Ebiquity.
"It's the intermediaries who are making money here, selling impressions whether they are real or not," he told Campaign. "It's not surprising, therefore, that advertisers and publishers are starting to question the economics because it's not working for either of them."
Hamish Nicklin, the Guardian's chief revenue officer last year revealed that when the newsbrand had purchased its own ad inventory in an attempt to track where the money was spent across the digital supply chain, in some cases as little as 30 pence in the pound was coming back to the publisher.
Chairing a panel at Advertising Week Europe last week, Nicklin was critical of "the prevailing wisdom of what digital paradigms should be, regardless of what your marketing objectives are" – a state of affairs he laid squarely at the feet of the Google and Facebook.
"Quality, premium, safe environments – those are metrics and factors that are completely ignored in today's ecosystem," he said. "It is all about cheap low cost audiences at scale because it benefits the two people who can shout very loudly about that being the way forward."
On the same panel, Tony Katsur, president of direct audience platform Sonobi, attacked the "degrees of obfuscation" in the current ecosystem and warned advertisers that they "need to be more involved with the technology they leverage".
Rubicon Project disputed the Guardian's allegations, saying the claims amounted to a contract dispute which it would contest in court.
"We charge buyer fees for certain services we provide and have disclosed that fact publicly," it said in a statement. "Without buyer fees we would need to charge sellers more, and we think our approach is fair."
Data sourced from Campaign, The Drum, MediaTel; additional content by Warc staff
