A large number of websites rely on advertising as their primary source of income. Typically the ads are served by third party ad networks (for example Google’s adsense). When an ad network is unable to find an appropriate ad for a specific page being served to a specific reader, they put in default or public service ads (PSAs). This is not good because the website makes no money from PSAs.

Ad optimization service Pubmatic, says that more than half the ads that get shown at an average website are PSAs:

Over the past several months we’ve studied just how severely default ads are affect our publishers and the numbers are jaw dropping. We found that ad networks defaulted 56% of the time on average and as much as 87% of the time. We also found that that the traditional static daisy chain of ad networks may be effective at reducing blank ads but is highly ineffective at maximizing a publisher’s revenue. Between 20% and 30% of publishers’ ad inventory is going to waste.

(Source.)

This is of course terrible, if true.

Now Pubmatic has just launched the default optimization service that automates the process of contacting other ad networks whenever the ad being served by the primary network is a PSA

PubMatic’s default optimization service automates the reselling process, allowing publishers to instantly redirect unsold ad inventory back to PubMatic, which fills that inventory with the highest paying ad impression every time. PubMatic’s new service is an automated solution for the billion-dollar loss that plagues the industry.

For more details, see the press release.
Related articles:
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See also:  The PuneTech wiki profile of Pubmatic , and Mukul Kumar, head of engineering at Pubmatic (based in Pune).