Cost-per-thouand ad impressions for online publishers is down about 20 percent, and sell-through rates are droppng. While publishers used to sell 60 percent of their inventory, now they’re down to 30 percent. For an average CPM, ad networks get between 60 cents $1.10, about 90% less than large publishers want when they try to sell their inventory directly.
Not that ad networks are flourishing right now. PubMatic’s fourth quarter AdPrice Index, showed that all sizes of networks were down dramatically from Q4 2007; small, medium, and large sites dropped 52%, 23%, and 54%, respectively, from the previous year.
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But if you’re a media buyer, and you can pay less for the same audience, why wouldn’t you? Some brands have pulled away from using ad networks, but with revenue tight, you can expect that to ease. And with performance driven advertising becoming more popular, how is that going to help/hurt publishers and ad networks?