"Today's programmatic landscape has fractured into a maze of silos, proprietary ecosystems and walled gardens, each one extracting value, controlling access and making it harder for marketers to see where their dollars actually go. Meanwhile, open internet programmatic, once the promised land of clarity and control, has been reduced to a fraction of the overall media mix. This wasn't inevitable. It was engineered."
"Walled gardens, specifically large technology companies, solved this commoditization by controlling both sides of the auction: the demand side (through their own DSPs) and the supply side (through their owned inventory). YouTube, Amazon Prime Video, Google Search, Facebook-they don't need to compete in open auctions. They own the audiences, the data and the infrastructure. That means they set the prices, control the signals and define what "premium inventory" means."
"What created this shift isn't a mystery-it's economics. When programmatic was truly open, every demand-side platform (DSP) could access the same inventory, use the same data and execute deals with similar efficiency. No platform had a meaningful data or inventory advantage, so advantages came from service, technology advancements and additional value across creative, automation, strategic partnerships and more. But here's what's missed in most conversations about walled gardens: Control doesn't always mean better performance. It means extraction. And extraction has a ceiling."
Programmatic advertising shifted from a common pool of inventory and shared data to fragmented proprietary ecosystems and walled gardens. Large platforms control both demand and supply by operating DSPs and owning inventory, enabling them to set prices, control signals, and define premium inventory. Advantages once earned through service and technology have been superseded by control and extraction. Open-auction opportunities now represent roughly 18.6% of bidding, with about three-quarters occurring in private marketplaces and the remainder in curated exchange-controlled deals. Control by walled gardens can extract value without necessarily delivering better performance, and extraction faces natural limits.
Read at Forbes
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