Digiday’s History of Ad Tech: Episode 1 with Brian O’Kelley

**Ronan Shields** (0:10)
Hello, and welcome to Digiday's History of Ad Tech, a special four-part series from the Digiday podcast, examining the disruption in the digital media space from the 1990s to the current day. My name is Ronan Shields, and I work here on the reporting desk at Digiday.

**Seb Joseph** (0:27)
My name is Seb Joseph, and I'm the senior newsletter here at Digiday.

**Ronan Shields** (0:31)
In this series, we're diving into the emergence of the ad tech industry, the intricate web of technologies that powered advertising shift from analog to digital. It all kicked off in the mid 1990s when the number of US internet users jumped from five to 12 million. And in 1994, there were about 10,000 sites on the world wide web. And legend has it, in October 1994, a graphic displaying a slim black box with multicoloured letters asked visitors to the website hotwire.com, have you ever clicked your mouse right here?
That was the first ever online display ad. This is for US telco AT&T. And this tiny event sparked a wave of innovation from entrepreneurs and dollar signs in the eyes of investors.
In 1996, the ad tech company DoubleClick was founded and this helped fuel the.com boom. But hey, what goes up must come down right. And cue the.com crash. And during this time, the ad tech world also took a hit. Companies faced their first mutual reality check with some soaring through the chaos while others were never heard from again. Through this roller coaster ride, the ad tech world just kept growing and getting even more and more complex.

**Seb Joseph** (1:52)
Join us as we uncover the juicy stories behind the big players, groundbreaking innovations and game changing shifts that shaped this ever evolving ad tech world.
Get ready for a deep dive into this thrilling ecosystem.
Our first guest is someone who was right in the thick of all of this. So much so that we could easily dedicate a four part series just to cover their journey during this pivotal period. I'm talking about Brian O'Kelley. Now, Brian's resume speaks volumes. He was the former CTO of Right Media, where he's credited with inventing the very first online ad exchange. After that, he co-founded the NetApp Nexus. In short, he's a heavyweight in this field, and we're thrilled to have him join us.

**Brian O'Kelley** (2:34)
Hey, thanks for having me.

**Ronan Shields** (2:36)
There's a lot of people that refer to you as the godfather of ad tech, and you have quite a few claims on some of your achievements and the things that you've indeed invented in this space. Can you just go through some of, what have some of your major landmark achievements been?
A lot of people credit with you with the invention of the ad exchange. Can you just talk us through some of those?

**Brian O'Kelley** (3:02)
Yeah, so in 2003 when I joined Right Media as the sort of founding CTO, the challenge we were all facing was basically how do we figure out the most effective ad to serve to the human on the other end of the browser?
And there was basically a daisy chain that people were running. You'd choose the highest paid ad network and the next highest paid, the next highest paid, and at some point if you were lucky, someone would actually decide to buy the ad.
And my realization was in trying to run an ad network that if we had a really high paying advertiser or we really knew that this particular human was going to convert, was going to actually buy something, we had to convince someone at the publisher to put us higher in the chain. And so everyone was kind of fighting to be first. But the information going back to the publisher was very slow. Like at the end of the month, you'd see how big your check was and you might allocate people based on that. But that makes no sense from a yield perspective. So I had the idea, like why don't we hold an auction? Like why can't we just get everybody at once to tell us what they're willing to pay and then we'll choose the highest bidder? And back in 2003, 2004, that was more or less technically impossible. I remember that we asked Dwight Merriman, who was the CTO of DoubleClick, about it and he said, can't be done. And I think for me a lot of my experience in ad tech was something around the, you know, doing things that no one thought could be done.
And so I think the things I'm most proud of are the moments when we were able, not just to do it technically, but also to figure out the right market framework where it made sense for other people to do it. You know, I remember we were, I was at about.com, this is probably in 2005 or 2006, and we were pitching them this idea of joining our ad exchange. And I think the response was, we will never, ever, ever, ever, ever on any circumstances ever, ever do Programmatic.