Good ad tech should improve campaign performance for advertisers, media performance for publishers and user experience for consumers.
Note: I appreciate how busy we all are; therefore, if you want to skim this long article please just skip to the part at the end labeled “Summary“.
In this years IAB MeasureUp conference I presented something that I call “ALT” which stands for Ad-Tech Latency Tax. It is the effects of internet latency on ad tech and how that affects media viewability. The presentation started by recapping the previous IAB events which covered these three topics:
- Frankenteck – The idea that, on average, there are upwards of 10 x pieces of ad tech which are all used in unison to bring 1 x piece of digital advertising to a consumer.
- The Clippet – The idea that, if you are not careful, that the majority of the media budget could be spent on ad tech and not on media.
- Oranges vs. Mangoes – The idea to separate ad tech into two categories (a) mangoes which have a large core of technology surrounded by a layer of palpy service vs (b) oranges which have much smaller core piece of technology and you end up paying for the service.
A new topic was introduced to build on the top of the previous topics. This new topic was the concept of Ad-Tech Latency (ATL). The hypothetical question was simple; Does too much ad tech slow down websites and degrade overall media performance?
This report started by looking at the baseline of global internet speeds from the free and independent company SpeedTest.net. The report showed that average internet speed in our country were 7.8 Mbps which is much slower than most developed countries.
In my personal opinion the core of the problem is that the NBN (National Broadband Network) has one core fundamental flaw. For some countries with fast internet their version of the NBN has internet connected to the exchange but in our country we have a lackadaisical attitude that NBN should be connected all the way to our lounge rooms.
I have first hand experience of the NBN rollout in Sweden whereby houses are grouped together by the local council and each house pays circa $3K to have fibre optic cables laid underground from the exchange to the house. This money is amortized over 3 years, at 0% interest rate, which is subsidised by the government and costs each house only about $50 a month. As a result, this type of infrastructure will offer a massive 200 Mbps for the same price as average Australian’s are paying for only their paultry 7.8Mbps.
This raises the question: If the local internet is slow, then it is slowing down ad tech providers?
A good place to start with local ad tech providers is MediaScape as it contains a list of many of the leading ad tech companies in the country. I picked a random sample of 20 x common ad-tech companies for this report. This presentation was not designed to name & shame so from this point forwards in the document each ad tech vendor was anonymised and given assigned a random number from 1 to 20.
Using the free tool called PING which is part of the Windows Operating system I called each of these ad tech providers 1,000 times and took the average response time for each server. The results below were pretty interesting. It showed that (a) most ad tech providers had their servers in Singapore and (b) the average response time from a server in Singapore is 150 ms.