When Atlas served ads, the industry shrugged.
On Friday, Facebook made the inevitable official by retiring the ad-serving component of Atlas, thereby making it primarily a people-based measurement pixel. The ad-serving capability will be phased out over the next couple of months so as not to be disruptive to users.
Facebook’s ad stack looks quite different today than it did during Advertising Week 2014, when it first rolled out the revamped Atlas ad server it acquired in 2013 from Microsoft. The company appeared ready to mount a challenge to Google’s DoubleClick, an impression confirmed by its acquisition of sell-side video platform LiveRail.
Could Facebook put together a scaled, mature ad stack that would act as a check on Google’s power? Turns out it couldn’t.
Since then, Facebook scrapped plans to build a demand-side platform for Atlas in March, shuttered its video SSP, LiveRail, in April and shut down FBX, its desktop retargeter, on Nov. 1.
What’s left now is the Facebook Audience Network – basically an ad network for a walled garden, albeit it a very lucrative one with a $1 billion run rate, based on Q4 performance – and campaign measurement via Atlas.
Ad tech at Facebook, in terms of being competitive with Google’s DoubleClick, is effectively dead.
In September, Facebook moved Atlas under its Marketing Sciences group led by Brad Smallwood, VP of measurement and insights. The combined teams will focus on developing better integrations between Atlas and Facebook’s measurement platforms.
Slimming Atlas down to focus solely on measurement is a logical move, said Erik Johnson, whose title will change from head of Atlas to head of client measurement.
“We see demand for measurement coupled with the fact that a greater and greater percentage of inventory is first-party served, especially on mobile,” Johnson said. “There’s a decreasing interest in third-party ad serving, which we saw coming, but it just happened much quicker than anticipated.”
It’s also hard to sell people on technology once that tech starts to get commoditized.
“People need a compelling reason to switch from one product to another,” Johnson said. “Clients could get all of the benefits of measurement without switching ad servers, so continuing to invest in building a product that a smaller and smaller percentage of our user base wanted felt like not the best place to focus our efforts.”
But it’s also true that as a platform with its origins in the desktop world, mobile and video ad serving were never Atlas’ forte to begin with, with some agencies and advertisers experiencing difficulty serving ads across formats and devices. It was clear by early this year that Atlas adoption was not tracking with goals. Facebook said at the time of the ad server relaunch that the product had 20 marketer customers. A year later it hadn’t updated that figure.
Although Facebook is axing its ad-serving capability, it’s still committed to cross-device, Johnson said.
“You can’t help marketers understand how their media is performing and how to make business decisions without some kind of cross-device offering,” he said. “You need that data in order to help clients, and we’re not moving away from that at all. But where a lot of that data sits today doesn’t require an ad server. The way to make our position clear is to make measurement the lead on everything we do and to do that we need to remove the noise around ad serving.”
But it remains an open question whether Facebook will eventually cave to buy-side pressure and provide user-level attribution outside of the Facebook ecosystem. Johnson effectively said the industry shouldn’t hold its breath.
“Some people have asked for that, yes, but people ask for all kinds of things,” he said. “We’re focused on protecting the data that our end users entrust us with and we’re tight on that for now. But the future is an unknown for everyone.”
