Great piece. "A network by any other name..."

I think the most compelling area here is the "black box" technology conundrum. In a nascent market, companies build features at rapid rates in order to achieve parity, differentiate, and capture share. The key is that, in the vast majority of cases, the operations of said “features” are opaque, and often augmented by human processing labor. And, validation takes long enough to occur that there’s plenty of room for “faking it ‘til you make it”.

We saw this happen in the SEM space in the early 2000’s: many companies were bought or sold based on the promise of “SEO algorithms” and “Paid Search Optimization” technologies. The reality, at least at that point in the cycle? SEM optimization = 50 temps in a room loading keywords and copy into spreadsheets.

We see this now in the DSP, exchange, and even the verification spaces, where, for example, some companies claim to offer classification technologies but in reality they’re parsing the Mechanical Turk. Here’s to rapid maturation of the market and a quick shakeout leaving the technologists standing strong, and the alchemists searching for the next new thing.

You get a lot of things right...what you are missing is that you greatly underestimate the technology capabilities underlying platforms such as Media+1. You want global frequency management? We offer it. How about the ability to integrate and use the client's own data? Got it. Think attribution modeling might be useful? Yes, we offer that, too. How about multi-touch point messaging, across display, search landing pages and website? yes, clients really like that. Custom targeting algorithms for each client? basic and fundamental.

So you are right...ad networks are not going away. But they will have to invest in technology that allows them to compete on a new playing field.

It is very normal for a any concept or product release goes through a cycle before it reaches a maturity level. I call that maturity level as the base level to take it to the next level.

I would argue though that the changes to that equation are significant. Exchanges and RTB are real and not going away. Just the name ad network alone is predicated on the idea of working directly with publishers. As that dynamic changes it will force everyone in the business to adapt and evolve.

It is going to be a very interesting year to see how this all plays out. Keep up the good work.

Martin-
I would argue that direct access to publishers is not fundamental to successful execution of the model. Access to inventory has been commoditized by exchanges and yield optimizers and that is a very good thing for everyone. The optimizers, especially AdMeld & Pubmatic have provided much needed infrastructure both to the publisher and to the buyer. This has allowed buyers to improve velocity along their supply chain allowing for better execution,

Fact is ad networks should have been demand side focused the entire time. Again, price is a reflection of the value created by each ad impression so the more value delivered to the advertiser, the higher the rates should be (in theory). Higher rates ultimately translate to better yield for the publisher. Has to start with the demand side though...