The Trade Desk’s decision to label all SSPs as “resellers” on its Kokai platform is reshaping programmatic supply paths, raising fears of lower CPMs, reduced demand, and heightened pressure on publishers.
Acronyms and taxonomies can feel like tedious and unimportant background parts of a job.
But labels matter. And when The Trade Desk relabeled all SSPs as resellers on their Kokai platform, the world shifted for SSPs and publishers.
The Trade Desk’s new platform, Kokai, downgrades SSP inventory by labeling them as “resellers” operating less efficient supply paths than TTD’s OpenPath direct-to-publisher connection. The sell side is worried the move could lead to lower CPMs for publishers and shift more spend to OpenPath.
Consequently, publisher payouts are sometimes dropping by up to half, prompting ad ops teams to reassess their header bidding setups and revenue forecasting.
Given the high stakes, the sell side isn’t inclined to let this relableing slide.
“I just don’t agree with that assessment,” said Greg Giovinazzo, AVP of Customer Success at PubMatic, an SSP.
Why SSPs Are Pushing Back Against Trade Desk Labels
Giovinazzo took us back to the launch of ads.txt.
He explained that, in 2017, the industry introduced ads.txt with support from the IAB Tech Lab, followed later by app-ads.txt, to clearly separate direct relationships from resold ones. Together with sellers.json, these tools define who has the right to sell inventory and help differentiate publishers from intermediaries.
“At PubMatic, we solely rely on our direct contracts with publishers,” Giovinazzo explained. “We actively go out and prospect new business, talk to publishers, sign new contracts to ensure that a direct partnership exists and then classify it correctly.”
Being labeled a reseller often means lower CPMs compared to a direct relationship. Giovinazzo noticed that, recently, some DSPs have stopped buying resold inventory, choosing instead to focus only on direct premium publishers, which ultimately reduces the overall demand pool.
Another SSP executive who wanted to remain anonymous to speak more freely echoed this sentiment: “The way they’re classifying SSPs and intermediaries doesn’t make any sense. These tactics ultimately serve the Trade Desk’s interest in margin and control, more than the buyers.”
SSPs that rely heavily on certain deal types, like the TTD’s Deal Desk, may see ad spend and deals redirected to The Trade Desk’s OpenPath, instead of their own existing supply paths. Some SSPs feel these effects more acutely depending on their integration depth across programmatic channels, including open exchange, one-to-one deals, multipublisher deals and programmatic guaranteed (PG) deals, according to the anonymous SSP exec.
Publishers are also feeling the pressure. “Publishers are fearful of the Trade Desk,” the exec added. “Once you have a lion’s share of the market, publishers feel they have no choice but to comply.”
High-Fidelity SSPs Deliver More Than Just Inventory
While publishers and SSPs are taking issue with the sweeping reclassification of inventory, they don’t dispute that the programmatic supply chain has too many intermediaries, thereby diluting transparency and value.
“There are intermediaries in this space that are net takers rather than net gainers,” said the anonymous SSP executive. But the best SSPs add real value beyond just taking inventory and adding margin, they added.
For instance, their SSP eliminated resellers in specific channels, such as CTV. Removing those resellers ensured the inventory was correctly classified and direct.
Giovinazzo likewise highlighted PubMatic’s Activate product, which enables buyers to transact efficiently while giving publishers control over their inventory and first-party data.
“We’ve got wrapper solutions, identity resolution solutions, audience extension tools and commerce plays—all sorts of tools that make it easier for a publisher and a buyer to transact,” said Giovinazzo.
But The Trade Desk’s reclassification puts all SSPs in the same bucket, no matter their approach to inventory quality, curation or data enrichment.
The Trouble With Arbitrary Labels: Who Decides?
Another point of concern is the DSP’s unilateral power to label SSPs, bypassing industry standards.
“It’s hypocritical to selectively adhere to standards when convenient,” the SSP executive said.
They added that The Trade Desk is being hypocritical because the DSP is against pre-bid reclassification of transaction IDs without industry consensus, while simultaneously reclassifying SSPs without industry buy-in. Essentially, they said, TTD seems to defend industry standards selectively.
PubMatic’s Giovinazzo added that publishers should have more say in defining direct versus resold supply paths since arbitrary labels carry real revenue and demand consequences.
For publishers struggling with the new classification, the SSP executive advised focusing on the buyer.
“Solve for what buyers care about—transparency, autonomy and control,” they said. “That’s the real source of truth, regardless of how platforms classify SSPs.”