What if YouTube Opened Up its Ad Inventory?
And why it probably won't
One of the more tantalizing questions that came up in my many conversations this week at Possible in Miami was, “what if YouTube opened up its inventory to everybody?”
Today, if you want to buy ads on YouTube, besides going directly through a YouTube seller and buying premium avail through YouTube Select, you need to use DV360, Google’s owned-and-operated ad exchange.
That wasn’t always the case. Back in 2015, third parties like TubeMogul were able to buy YouTube ads - until Google shut that down (sparking accusations of monopolistic behavior- which went unanswered, for quite a while).
Of course, today, Google has been legally deemed a monopoly by the Department of Justice, and a remedy is due soon. There are numerous theories as to how that may play out, including Google ditching its network business or getting out of ad tech entirely.
Which helps fuel the wide open YouTube speculation. That, plus the fact that in the programmatic marketplace, there are more and more partnerships among once strange bedfellows. You can buy Amazon’s audience on Roku, and even on Netflix. You can use Yahoo’s DSP to buy ads on Spotify. You can buy Disney as through Amazon, The Trade Desk, and even Google’s DSP. These are all companies that are often in the business of trying to kill each other.
So it sounds less crazy for YouTube to open things up. Let’s try and examine what might happen:
Could this bring a lot more new demand to YouTube?
Would we see more advertisers bringing different forms of targeting data to YouTube - like Yahoo IDs or Retail Media data - to theoretically make YouTube more effective for certain kinds of advertisers?
Would companies like Viant - which owns both IRIS and now TVision - get a whole lot more insight into what people watch and pay attention to on YouTube?
Would this change YouTube’s perceived value structure, and pricing dynamics?
Would Google ever work with The Trade Desk or Amazon?
Rachel Dillon, EVP of sales at Strategus brought up a great point. If YouTube made this move in a way that buyers and brands could plan, buy, and frequency-manage YouTube alongside the rest of CTV via a single DSP, “instead of having it off to the side” that could make life easier. It could theoretically also make YouTube easier to compare to - and optimize against - the rest of the TV ad landscape. Which could be good or bad for YouTube.
“Getting closer to unified optimization and reporting across YouTube and the rest of streaming, rather than stitching Google data to open-web CTV after the fact [would be a big change], said Dillon. “Currently, the two do not integrate well in the proverbial sandbox, leading to much interpretation regarding overlap, impact etc.”
All that being said, unless the Feds force YouTube to open up, there are plenty of reasons for the company to stay closed, such as:
Keeping viewership data and pricing data inside its four walls
Holding onto any ad tech fees
Connecting YouTube campaign data and performance to other, larger Google ad deals
The simple fact that YouTube is growing at a very healthy clip ($9.8 billion in Q1, per CNBC). They may say, ‘we don’t need anyone’s help, thanks.’
“A lot of today’s YouTube dollars are already committed through Google’s own stack,” said Dillon. “So a big piece of the value is efficiency and control for buyers.” It’s hard to be sure “new money magically appears.”
Still, it’s nothing if not intriguing to think about.