Sell-side advertising platform Magnite today said it acquired SpringServe, the ad-serving platform for connected TV (CTV), for about $31 million. SpringServe’s technology handles inventory routing, customized ad experiences and advanced podding logic for CTV publishers.

“We look forward to collaborating with the Magnite team and their clients on product development and new features that will ultimately move the CTV advertising industry forward,” Joe Hirsch, the former CEO of SpringServe who is now general manager of SpringServe for Magnite, said in a statement.

In this video interview with Beet.TV, which was taped before the deal announcement, Hirsch describes how innovation in CTV advertising is improving the viewer experience. Delivering video ads programmatically requires a combination of technologies including an ad insertion platform, video ad server, sell-side platforms (SSPs) demand-side platforms (DSPs). 

The goal is to create a seamless experience for audiences by avoiding delays in ad delivery that were associated with waterfall auctions of CTV ad inventory. The limitations of waterfall auctions have spurred a shift to unified auctions. 

“In a unified auction, everything is called simultaneously, and you only have eligibility to serve if your price is the winning price,” Hirsch said. “The community at large has rallied around the unified auction as the victor of the war between the waterfall and the unified auction.” 

Revenue per second metrics are part of the evolution of decisioning within an auction, but have pitfalls when comparing the value of different lengths of ads. 

“If you’re paying $15 for a 15-second spot, and you’re paying $16 for a 30-second spot, revenue per second is going to make the ‘loser’ win — that is, the person with the lower bid is going to win,” Hirsch said, explaining that the lower bid wins because value per second for a 15-second spot is higher than for the 30-second spot. 

“It’s much more granular and fine-tuned approach for the sell side, and for the buy side, I think what it means is that if you have a longer creative, and you’re not getting the delivery that you want, you need to increase your bid in order for your revenue per second value to be competitive with shorter ads,” he said. 

Challenges of Fragmentation 

The fragmented media landscape has challenged advertisers to make sure they’re reaching audiences while avoiding excess frequency of ad placements. Digital platforms have become “walled garden” with their own first-party data about consumers.  

“The big players have decided that if you want to buy their audience, and you want to use their data, you have to go to them directly as a mechanism to get to a larger percentage of the media dollar that’s being spent,” Hirsch said. “The fragmentation itself is kind of a great challenge for the ecosystem, and it leads to innovation within adtech as a whole.” 

The innovators include TripleLift, a native advertising technology company that has partnered with SpringServe. TripleLift offers an SSP that connects to SpringServe’s publishers for traditional commercial breaks.  It also offers dynamic product placement ads that appear within video content, including shows appearing subscription video on demand (SVOD) platforms that don’t have commercial breaks. 

“TripleLift has been a great partner for us,” Hirsch said. “Early on, TripleLift saw the value of being an auction participant using the server-side header bidding methodology. They came from a background in AppNexus where they got a first-hand view of where the market was going before CTV was dominant.” 

Hirsch foresees more growth in CTV advertising as brands seek to reach audiences that have either canceled cable service, or never signed up for it in the first place. 

“Dollars will continue to migrate from traditional linear onto CTV, and the targeting capabilities and the reporting capabilities and the monetization features for publishers will meet the needs of consumers as they stream, the buy-side as they buy and the sell-side as they desire to make more money,”he said.