Containerised Bidding Arrives: How Bedrock Platform Is Redefining The $200+ Billion Programmatic Ad Business
Hello readers. We took a little break from writing the newsletter for a few weeks. It’s all quality here, not quantity. We are not in the business of news analysis or rehashing other people’s work. Faux zeitgeisty narrative is a definite no. Original ad tech material, only - to paraphrase the lyrical genius of The Streets on Let’s Push Things Forward.
The day-to-day has also been a contributing factor to our mini hiatus: we’ve been busy incubating a bunch of new ad tech businesses, which will be a huge feature of Fund 2 (more on that thesis at a later date). Some exciting left-field solutions are coming your way very soon.
Bedrock Platform: The True (Only) Heir To IPONWEB & AppNexus
The subject of this week’s edition was originally an incubated startup within FPC and is now building the most innovative, bleeding-edge programmatic ad tech in the business. We are, of course, talking about Bedrock Platform.
In case you missed it, Bedrock Platform announced a new innovation in ad tech, the containerised DSP. In partnership with Index Exchange, Bedrock has built a highly efficient, cost-effective way to execute programmatic buys on the sell side.
Now you might be asking: what is containerisation, and why should it matter to buyers? Those would be excellent questions.
Before we tackle those queries, though, it’s important to talk about the collapse of this laughable buyside/sell-side demarcation. SSPs compete with legacy DSPs, and legacy DSPs compete with SSPs. End of.
Just have a cursory look at SSP open roles - mostly demand-focused gigs. The narrative of “one platform” and “mono access” dominates. For SSPs, all the growth is direct access for brands and agencies.
There is a caveat to this trend, though: the modern DSP/buying platform. Instead of a monolithic DSP stack, you have a composable framework where Bedrock Platform becomes the tech layer for its customers’ optimisation or data. In short, it is a malleable technology layer that can run anywhere.
Containerisation is the perfect manifestation of this - especially in the context of DSP/SSP dynamics. Bedrock Platform can now run its bidder within the Index tech stack, hosting the buying logic alongside the inventory.
This allows Index Exchange to remain wholly aligned with the sell-side-first, and Bedrock can independently serve its buy-side customers. It’s a strange ecosystem indeed - but somehow this works.
Containerisation goes way beyond clunky, invariably unworkable DSP-to-SSP deal-ID activation. It is beautifully efficient and performant by comparison.
FPC was going to explain all this with a crude visual, but luckily, Bedrock Platform has done an excellent job in articulating the complexity in this magnificent video explanation (see below).
What This Means For Performance & Margin Retention
This is a big deal. Hosting the Bedrock Platform bidder inside Index’s infrastructure increases performance and win rates for buyers. There is zero latency and data leakage. That has huge implications in ad performance, putting it on par with walled gardens.
A major attraction of containerisation is margin retention. It will be significantly cheaper to use a Bedrock/Index instance than to use a buy-side stack to activate programmatic buys.
Driving down infrastructure costs will have big P&L implications for principal media buyers or ad networks running IOs/deal IDs. Readers might scoff/tut-tut at such a reductive view of the industry. Ultimately, money talks.
When you layer in omnichannel supply access and easy-to-use agentic capabilities, you now have the ultimate trading tool.
Agencies, Ad Nets & Onboarders: Time To Move To Bedrock Platform (Natch!)
If you are in the margin game, it’s hard to see how a legacy DSP can make sense. For a big global FMCG or any scaled global brand, the traditional DSP makes perfect sense. This will always be a huge chunk of the market.
For others, though, like ad nets, principal media buyers or big media cos looking to buy their own supply, the logic isn’t there.
The recent spat between TTD and Publicis was not about “hidden fees”; it was about where the margin will go. Buy-side DSPs plus principal media buying just don’t work - especially if you want campaigns to perform.
Margin is existential for ad nets: they need to optimise for EBIDTA to have any chance of an acquisition; an extra couple of percentage points will make all the difference in a liquidity event.
Media companies buying their own supply (from RMNs to big-scale pubs to streamers to apps) via a DSP will always be constrained by an inflated DSP take rate.
That won’t be the only reason to switch, though: building on legacy solutions with fixed and inflexible product roadmaps makes it harder to stay competitive.
There are very few (if any). solutions built specifically for the “ad tech middle” - a constituency that was once well served by AppNexus and IPONWEB. But no longer.
The “Ad Tech Middle” is frustrated by the lack of innovation and the self-serving business interests of the current ad tech offerings.
The ATM is invariably seen as a “nice to have” customer segment, just not business-critical.
There is a big gap in ad tech capability. Bedrock Platform is filling that void. FPC is excited to see such a real prospect emerge from the European ad tech ecosystem. And the upside has only begun.
The no-brainer move now: test Bedrock Platform offering; start to reclaim agency over your tech and economic future.
It’s all about the Ad Tech Middle FTW.
And on the public service notice, we will leave it there, readers. Have a great ad tech day.