total cost of ownership webinar

Total cost of ownershipTotal cost of ownership

How much are you really spending to host your ad server?

Presented by Alexander Dean, Principle, Keplar, LLP

Twitter Hashtag: #OXwebinar

Total cost of ownership (TCO)

• What is required to host your own ad server?

• What is the true cost of hosting your own ad server?

• How does this cost compare to a fully hosted solution such as OpenX Enterprise?

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We cover three distinct TCO comparisons, each one focusing on a different-sized publisher

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Size of publisher Self-hosted ad server

Hostedad server

Impression rangevs

Small, regional OpenX Source OpenX Enterprise 50m-500m

Medium, regional DART Enterprise OpenX Enterprise 200m-1bn

Large, multi-regional DART Enterprise OpenX Enterprise 500m-5bn

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Anatomy of a self-hosted ad server

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SoftwareSoftware

ServersServers

StaffStaff

There are three key building blocks to hosting your own ad server:

The ad server software needs to run on one or more servers (either dedicated, cloud or VPS)

The ad server will need a systems administrator and some form of technical user support

Using one of the few installable commercial-strength ad servers (incl. OpenX Source and DART Enterprise)

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Putting it all together

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The exact number and setup of servers will depend on various factors, most importantly:

The geographical distribution of the site’s visitors

The volume of ad impressions to serve, including peak volumes

Total cost of ownership #OXwebinar

Our three different TCO scenarios are based on two distinct technical architectures

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on a simple, non-load balanced architecture

on a complex, globally load balanced architecture

A small, regional publisher

11

using

22A medium sized, regional publisherusing

33A large, multi-regional publisherusing

Total cost of ownership #OXwebinar

Our benchmark: OpenX Enterprise

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For each of our TCO comparisons we will use OpenX Enterprise as the benchmark:

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How we calculated the TCO for a small, regional publisher using OpenX Source

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To calculate the cost of a self-hosted, non-globally load balanced OpenX Source ad server we used the following inputs:

SoftwareSoftware

ServersServers

StaffStaff

• Assume 25m impressions / month / server

• Assume each server costs $300 / month

• Assume 25% of impressions are rich media

• Assume one technician paid $87,000 / year

• How much time spent on ad server varies from 50% to 60% based on volume

• OpenX Source is free, so no cost here

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Comparing this TCO to OpenX Enterprise

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The monthly cost of self-hosting OpenX Source scales linearly, and is 41%-225% more expensive than OpenX Enterprise:

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Total cost of ownership #OXwebinar

How we calculated the TCO for a medium sized, regional publisher using DART Enterprise

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To calculate the cost of a self-hosted, non-globally load balanced DART Enterprise ad server we used the following inputs:

SoftwareSoftware

ServersServers

StaffStaff

• Assume 25m impressions / month / server

• Assume each server costs $230 / month

• Assume 25% of impressions are rich media

• Assume one systems administrator utilised 25%-35% paid $96,000 / year

• Assume one technical support operative utilised 25%-35% paid $78,000 / year

• DART Enterprise costs $250k or $9,600 / month over 3 years

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Comparing this TCO to OpenX Enterprise

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The monthly cost of self-hosting DART in a regional setup scales linearly, and is 232%-46% more expensive than OpenX Enterprise:

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Large, multi-regional publisher using DART Enterprise: how we calculated the TCO

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To calculate the cost of a self-hosted, globally load balanced DART Enterprise ad server we used the following inputs:

SoftwareSoftware

ServersServers

StaffStaff

• Assumptions as in scenario 2, but add:

• Upweight required impressions by 40% to handle one regional center falling over

• Assume $1,200 / month for global load balancing

• Assume one systems administrator utilised 30%-100% paid $96,000 / year

• Assume one technical support operative utilised 30%-100% paid $78,000 / year

• DART Enterprise costs $250k or $9,600 / month over 3 years

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Comparing this TCO to OpenX Enterprise

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The monthly cost of self-hosting DART globally scales linearly, and is 165%-37% more expensive than OpenX Enterprise:

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The monthly costs of self-hosted ad serving are significantly higher than hosted OpenX Enterprise in all three of our TCO comparisons:

Our benchmark: OpenX Enterprise

A small, regional publisher

11

using

22A medium sized, regional publisherusing

33A large, multi-regional publisherusing

41-255%

46-232%

37-165%

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The self-hosted setups have several limitations which are not highlighted in a straightforward TCO comparison

There are some other key differences between self-hosting and hosted adserving

RedundancyRedundancy

SecuritySecurity

FunctionalityFunctionality

Malware groups use out-dated, unpatched self-hosted ad servers to distribute malware

Self-hosted OpenX Source does not have all of the plugins (e.g. forecasting, advanced analytics) found in OpenX Enterprise

No global load balancing / spare capacity in our first two scenarios – one data center means a single point of failure

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Given the cost comparisons and other qualitative issues, we recommend that publishers use a hosted ad server solution such as OpenX Enterprise

Total cost of ownership #OXwebinar