Brief:

• Smaato, an advertising platform for mobile publishers and app developers, has integrated with Amazon Publisher Services (APS) to give in-app demand partners access to Amazon's Transparent Ad Marketplace inventory, according to a press release. Publishers using Amazon's services can now use a programmatic exchange to run ads for mobile users.
• The server-to-server integration lets publishers using APS benefit from Smaato's global in-app demand, which currently makes up 96% of global ad spending on its mobile-only exchange. Meanwhile, Smaato gets more direct access to a broader range of quality ad supply.
• Smaato handles as many as 19 billion mobile ad impressions a day and reaches more than 1 billion unique mobile users monthly. Its platform connects 10,000 advertisers with more than 90,000 app developers and mobile web publishers, it says.

Insight:

The addition of Smaato's global mobile demand to Amazon's Transparent Ad Marketplace adds value to buyers who benefit from scale on premium apps. In addition, sellers could see increased competition for their inventory, potentially raising prices and revenue.

Here, Amazon is undercutting Google on ad tech fees as it recruits for APS, a division that competes head-to-head with Google's DoubleClick for Publishers. Amazon is well positioned to target broad audiences, given its unmatched data on people's shopping habits that Google and Facebook, leaders in the online ad market, don't have. EMarketer forecasts that Amazon will generate $3.7 billion in worldwide ad sales this year, but the company's most recent earnings report seems to indicate its ad business already totaled more than $2 billion in Q1 2018.

Amazon is taking aim at the online ad market dominated by Facebook and Google with its characteristic penchant for efficiency, predatory pricing tactics and obsession with automation. The e-commerce giant plans to move aggressively into self-serve programmatic advertising and expand its infrastructure to get more brands buying ad space on its websites and through its ad platform, per Ad Age. Amazon is working with ad tech companies, agencies and media companies to create platforms that make buying ads on its platform easier, similar to how the company transformed electronic checkout.

Smaato's integration with APS follows the platform implementation of Protected Media's in-app and video ad fraud protection to defend its network. In the prior six months, Protected Media saw in-app fraud, where fraudsters mask low-quality apps to look like premium publishers, rise to almost 10 times the previous rate across its installed base. While video accounts for 45% of total ad spend, it's linked to 64% of all ad fraud and also requires additional fraud prevention in-app, per Forrester.