Publishers lack stick or carrot to adopt new classifications
Publishers largely recognize the value of the updated video classifications, as improved transparency could encourage more investment. But a number of factors are discouraging them from implementing the new protocol, according to sell-side sources.
For instance, there is no explicit financial incentive—such as increased demand or higher CPMs—to pass the correct bid signals, according to an executive at an ad-management firm.
If we move now, we lose bid density. There is a revenue impact
Anonymous exec at a publisher
There is also no explicit penalty for passing the outdated signals, as DSPs, including The Trade Desk, still respect the non-compliant declarations, according to a publishing executive.
Additionally, there is no clear deadline for when compliance will be required, deflating any sense of urgency.
While there are few factors incentivizing publishers to adopt the standards, there are ample factors discouraging them from doing so.
The primary concern is that publishers’ ad revenues could drop if they have to reclassify what was formerly considered in-stream inventory as accompanying content or out-stream, which net lower CPMs.
Publishers who have adopted the new signals have not seen a significant drop-off in their revenues, according to multiple supply-side sources, but no one can predict how spend will behave following widespread adoption.
This disparity in CPMs also means that a publisher that has accurately reclassified its in-stream inventory as out-stream could fetch a lower CPM than a publisher misclassifying the same piece of inventory as in-stream.
In another instance, a publisher that has updated its tech stack to allow it to pass the updated signals has continued passing outdated data for fear that its SSP partners might be unable to recognize the new signals, jeopardizing its bid.
“If we move now, we lose bid density. There is a revenue impact,” an executive at the publisher said. “We are ready technically to make the change.”
Enforcement questions further stymie adoption
Similar to the concerns facing digital video quality more broadly, the rollout of the new video taxonomy has posed fresh challenges for SSPs looking to comply with the protocol.
For example, if a publisher classifies its video inventory using both the old and new specifications, it could send a bid request classifying a video as both in-stream by the old parameter and out-stream by the new, said one supply side executive. In these cases, it is up to either the SSP or the DSP to figure out how to interpret the bid request.