AppNexus thinks there'll soon be just 3 places you need to go to buy video ads: YouTube, Facebook, and AppNexus
Outstream video ads are those users see appear on a page as they are scrolling through an article, which start playing automatically without sound. Users can dismiss or scroll away from the video if the ad doesn't appeal to them. An open marketplace means advertisers can buy these sorts of ads across a variety of different publishers websites, including those that don't currently offer video advertising inventory.
In the announcement press release, AppNexus says the marketplace will provide one of the "largest pools of programmatic outstream units." The company is hoping that the launch, coupled with its programmatic video capability launch last year (which allows marketers to buy more traditional, in-stream ads that sit within video players,) will mean that in the not-to-distant future, advertisers will only need to go to three destinations to buy online video ads: AppNexus, YouTube, and Facebook.
AppNexus says YouTube and Facebook are increasingly erecting "walled gardens," meaning if you want to buy video ads on those platforms, you most likely have to do it directly through YouTube and Facebook, rather than through a third-party ad tech company. In August, for example, YouTube restricted marketers buying ads via third-party companies through the DoubleClick ad exchange. In January, Facebook's video ad tech platform LiveRail exited the ad server business.
Speaking to Business Insider, AppNexus president Michael Rubenstein said: "YouTube and Facebook have made their bets around a very closed approach to video advertising. And it's not actually about quality. The quality is actually quite poor - there are so so many cat videos on YouTube, s you know. It's because they have quantity. What's really cool about this [outstream video marketplace launch] is not just quality inventory and quality brands, but a really open approach to integrating with all kinds of companies, technologies, and techniques. I think that's where we typically draw the line with our business: taking open technology approach to a new market, and creating a real supermarket for video advertising."
Open exchanges, however, are known to have a higher prevalence of bot and ad fraud compared to private exchanges. AppNexus, which has recently been on a march to clean up the ad inventory on its platform, said the video exchange will support the ability for ad buyers to use third-party verification services such as Moat, Integral Ad Science and DoubleVerify. In addition, the company also has a team of data scientists and blacklists designed to keep the inventory in the outstream video marketplace clean.
US marketer spend on programmatic video advertising (video ads bought through automated, technology-driven methods such as through the AppNexus platform) is set to grow 84.5% year-on-year to $5.37 billion in 2016, according to eMarketer.
Rubenstein said he hopes the launch of a large outstream video marketplace will boost this spend even further as it allows a lot of non-traditional video publishers to become sellers of video advertising (because the ads appear in the "stream" as users scroll down, rather than having to sit within a video player.)
Here's a video from AppNexus explaining how the outstream video marketplace will work: