AudienceScience has shuttered its publisher network business to focus completely on marketing technology. The move is yet another sign of weak demand for traditional ad networks, as buyers steadily migrate budgets to exchange-traded media bought through DSPs.
President Mike Peralta tells AdExchanger, "The transition has been in the works for 12 to 18 months. Across the environment, trading desks, DSPs, and programmatic buying have all taken share away from the classic network buy." The move was also motivated by client feedback, Peralta said. Scrapping its ad network will help Audience Science avoid concerns over conflict of interest related to media buying.
Audience Science has laid off 33 U.S. employees in sales and marketing, along with an undisclosed number of operations support staff in India. "A number of ad network employees were moved into roles supporting our platform business," the company said. In June, CEO Jeff Pullen estimated headcount at 230 employees, so with the end of its network the company presumably shrinks to somewhere south of 200.
AudienceScience is not the only company to get out of the ad network business. Lotame did so last year, and by its own account the move has paid off, allowing the company to double down on its data management platform and restore revenue to 2011 levels, according to Andy Monfried (AdExchanger Q&A).
"The comparison, and I think it's a plus for both companies, is we both realized we can't be everything to everybody," Peralta says.
The differences between the two companies comes down to business model. Lotame is a pure play data manager, while Audience Science combines its ad execution platform with a range of data sources. Both had publisher businesses, and had used those relationships in part to support an ad network offering.
When AdExchanger spoke with CEO Jeff Pullen in June, the company had already begun to downplay the ad network. Here's what he said on the subject:
"The original concept of our own ad network or our own publisher relationships was that we had a lot of large publishers who were using our technology for their own account, paying us directly for the utilization of our technology.
But there are a whole lot of other publishers, smaller publishers, who maybe weren’t in a position to pay us directly for our technology, but were more than happy to participate in the audience‑targeting world. We still do that. It’s not the biggest part of our business, but it still exists."