Facebook to unveil real-time ad bidding

14 Jun 2012

In a move similar to Google, social network Facebook is planning to launch real-time ad bidding for brands targeting consumers. Called Facebook Exchange, the service will enable advertisers to reach users based on their browsing history elsewhere on the web.

According to IDC, real-time bidding accounts for 27pc or US$5bn of the US$19bn to be spent online on ads in the US alone this year.

The idea behind the bidding is to allow advertisers to reach users based on time-sensitive opportunities, such as driving advertising to thousands of Ireland supporters before, during and after tonight’s Euro 2012 match between Ireland and Spain.

Facebook will continue to offer advertising based on users’ interests and ‘likes’, but the addition of bid-driven ads stokes up the competition against Google, Microsoft and Yahoo! and could be a major moneymaker for the social network.

People are the product – you are commodity

However, the move once again calls into question privacy, the use of cookies and what exactly internet giants are doing with our information.

Facebook has had to answer awkward questions in the past around its use of cookies and has had to point out – quite realistically – that cookies are essential to providing users with the functionality they would expect.

However, the new service – which may use technologies from MediaMath, Triggit and AppNexus – will base bid opportunities on browsing patterns of users on other sites, which only cookies can reveal.

In recent days Microsoft and Yahoo! came under the spotlight after investigative journalism outfit Pro Publica revealed they were selling user names, zip codes and other data belonging to their users to political campaigns without telling their users.

While selling ads based on browser history could be deemed an actual service in terms of better and more relevant targeting, Facebook could find itself under pressure once again to prove advertisers themselves are not being given this data.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years