Why we do not run an auction on the supply side

Real-time auctions are the default mechanism in programmatic advertising, and
for the buy side they make sense. Applied to the supply side, and particularly to individual
creators, they produce a specific and avoidable harm.

What an auction does to a supplier

An auction tells a supplier what they earned after the fact. For a large publisher with an
analytics team and a diversified inventory base, that is manageable — the variance averages out
across millions of impressions and somebody is employed to model it.

For an individual creator, it does not average out. Their inventory is one stream on one
evening. A rate that moves for reasons they cannot see, and learn about a month later, is not
income they can plan around. It is a lottery with a job attached.

The alternative is an offer

We make an offer. A creator sees what the work is and what it pays, and accepts or declines.
If they accept and deliver, they are paid that amount on verified delivery. The word matters to
us: an offer travels from us to them, and they hold the decision. A bid would travel the other
way and imply they were competing for the right to be paid.

What this costs us

It is worth being honest that this is not free. An auction extracts the maximum available
price at every moment; a stated rate does not. We carry the difference, and the risk that we
priced it wrong.

We think that is the correct place for the risk to sit. We have the data, the modelling and
the diversification to absorb variance. A creator has one stream and a rent payment.

What it does not mean

It does not mean rates never change. They will move with demand, seasonality and what a
particular audience is worth. It means they change before the work, in an offer a creator
can decline, rather than afterwards in a statement they can only read.