Last year, the IAB Tech Lab announced proposed changes to its Ad Formats Guidelines for Digital Video and CTV. The guidelines were officially published in September of 2022 which kicked off a workstream for OpenRTB (the communication protocol that enables real-time bidding) to support the new definitions in October of the same year. These proposed changes were big: if they went into effect, they would topple key tenets of online video advertising as it has existed for over a decade, altering the field for both publishers and marketers in hugely significant ways.
The response to this proposal was, to put it lightly, overwhelming. Some were for it, some were against it—but few were silent on the issue. Months passed, and nothing went into effect—it was unclear in what direction the IAB Tech Lab was headed. Would they soften the proposals? Go in the other direction? Suggest something else entirely?
Well, a few months later, in February 2023, the programmatic supply chain community (which includes publishers, SSPs, DSPs, and everyone in between) agreed on the updated signaling. After 30 days of public comment, the updated definitions went into effect and the old definitions were deprecated (meaning, you can still use them for now but they will eventually be removed). No one expects publishers to comply immediately, but they should be working on a short-term strategy to do so—not simply to stay on the right side of the IAB's best practices, but because these changes actually stand to benefit publishers, even if it might not seem that way at first.
But to understand how, exactly, publishers might benefit from the changes, it's first worth examining them in a bit more detail.
In-stream vs. out-stream
Although the IAB Tech Lab has never explicitly included an attribute for out-stream in the OpenRTB specification, most ad tech companies always referred to two key formats within video advertising: in-stream and out-stream.
The notions of 'in-stream' and 'out-stream' have been stable for a long time now, but with the IAB Tech Lab's new rules, they're getting a major shake-up, particularly in what will no longer be considered in-stream. Understanding what is categorized as what is about to be extremely important—so here's a quick guide.
What it is: Before the IAB's proposed changes, the definition of in-stream could vary. In-stream has always been considered the premium option—though in practice, things haven't always played out that way. The platonic ideal of an in-stream ad would be, say, the pre-roll on a YouTube video that a user has actively navigated to. However, there were less ideal scenarios in practice as well, resulting in videos that few have actually watched, historically.
What's changing: In a sense, things are getting much simpler here. In-stream ads now have one simple, easy-to-understand definition: they are videos that don't autoplay, that start with the sound on as default, and that play before, during or after video content that a user has actively requested. This content should be delivered within a player and should be monetizing content delivered by the publisher. In other words, this is the kind of content a user has voluntarily elected to sit through in exchange for some desired bit of publisher content.
What it is: An offshoot from what has been historically called in-stream, accompanying content is a new official format. This type of content can be videos served before, after, or between text or graphics and may appear as in-feed or in-article. While the video may not be the initial focus of a user’s visit, accompanying content can serve as added value to audiences.
What it is: As mentioned earlier, out-stream has never been a signal in OpenRTB or AdCOM (the advertising common object model that describes the media objects that are bought and sold across any transactional protocol). However, out-of-stream advertising traditionally refers to ads shown in standalone environments. They typically appear within a video player in a display unit. They included in-banner video, interstitial video, in-feed video, etc. Though occasionally subject to spammy practices, in recent years out-stream video has regained credibility and become a favorite of online marketers.
How it's changing: Out-stream continues to be missing from the IAB’s guidelines but there are 2 new formats that the industry historically used to bucket within this category:
This category is used primarily for video ads that take over the entire page on the web or in-app.
No content/ standalone
This format was formerly described as in-banner, or in-article/in-feed players that don’t have any video content. The RSS feed-to-video format, or slideshows, now falls into this category.
What it all means for marketers and publishers—and what comes next
You can understand why some publishers were initially alarmed by these changes. On average, CPMs for in-stream range 15-20% higher than out-stream video ads—and now the IAB is proposing to turn the vast majority of video ads into other categories.
Fundamentally, though, this is a good thing. For years now—through sometimes painful trial and error—marketers and publishers have been trying to find some way to increase transparency around their shared endeavors. The opacity and occasional shadiness that attached to both sides of the equation in the 2010s is now a shameful memory for many: it has become clear that the only possible way to generate sustainable growth is to increase trust and to ensure that both parties are actually getting something out of all this activity. Yes, large view counts are nice, as are large amounts of money from ad buys, but if consumers aren’t actually being reached, none of this will be able to last for much longer.
In the immediate short-term, then, some publishers should expect to see at least a slight diminishment in revenue. But once a critical mass of publishers begins complying with these guidelines, we can expect to see a fairly quick rebound. As Adweek recently put it: "Budgets will shift to out-stream. In-stream will go back to being the premium it was always meant to be, and CPMs will skyrocket."
Again: publisher concern here makes sense. But every indication suggests that these changes will actually benefit everyone in the long-haul. Full implementation might take a while, but by this time next year, the new in-stream/out-stream paradigm will almost certainly be paying dividends for marketers and publishers alike.
Have questions about the new IAB guidelines and how they apply to you?