Advertising is a tried-and-true way for streaming services to generate revenue. According to Statista, over-the-top (OTT) TV and video revenue was 74 billion dollars in the United States in 2023. A forecast suggested that this revenue will continue to increase to beyond 80 billion dollars by 2029. While SVOD (subscription-based video on demand) will likely remain the largest segment, ad-supported streaming will show the highest growth rate.
You are likely familiar with Server-Side Ad Insertion (SSAI) and Client-Side Ad Insertion (CSAI). However, there’s another promising option on the rise: Server-Guided Ad Insertion (SGAI). But what is SGAI, and how does it differ from its counterparts? In this article we will explore SGAI and how it can enable you to get the best of both CSAI and SSAI.
What is Server-Guided Ad Insertion (SGAI)?
Server-Guided Ad Insertion is an advanced ad-insertion technology where the player and ad server dynamically guide which ads to insert based on real-time viewer data and context. The server signals the ad breaks while the client-side video player handles the personalization, ad insertion, and beaconing.
Here is a brief overview of how SGAI works:
- Manifest creation: The server generates a manifest with SCTE-35 markers, or another proprietary format. These markers outline where and when ad breaks occur during the stream.
- Ad request: When the viewer reaches an ad break, their device sends a personalized request to the ad server using targeting data so the server can deliver a relevant advertisement.
- Ad playback: The device handles the ad insertion and playback, ensuring the advertisement and main content flow seamlessly without delays.
By using SGAI, streaming services can deliver a more personalized and efficient ad experience, benefiting both advertisers and viewers.
SGAI vs. SSAI vs. CSAI
How does SGAI compare to Client-Side Ad Insertion (CSAI) and Server-Side Ad Insertion (SSAI)?
Client-Side Ad Insertion (CSAI): CSAI, which came first, involves inserting ads into the main content stream on the client side, meaning the video player handles the insertion. This method is easy to get started and requires minimal infrastructure while offering high levels of personalization and customization. However, some downsides of CSAI are:
- Difficult to implement across platforms.
- Highly susceptible to ad-blockers.
- Hard to ensure smooth ad-break transitions.
- No standard for signaling breaks, necessitating bespoke development.
Server-Side Ad Insertion (SSAI): To address these shortcomings, many companies have transitioned to SSAI, also known as “ad stitching.” This technique integrates ads into the video stream on the server’s side prior to delivery, making it more resilient to ad blockers and easy to implement across multiple platforms. However, SSAI also has its drawbacks:
- Challenging at scale, resulting in higher costs.
- Reduced agility when adopting new features due to server dependency.
- Limited targeting and ad personalization possibilities.
- Inefficient use of ad inventory, as it is reserved ahead of the break, regardless of the viewer.
- Difficult to implement new ad experiences.
- Switching clear and DRM protected content reduces experience on smart TVs or makes implementations difficult.
How does Server-Guided Ad Insertion work?
As mentioned above, you can think of Server-Guided Ad Insertion (SGAI) as a hybrid solution that combines the strengths of both CSAI and SSAI. In this method, the server generates a manifest with SCTE-35 markers, which indicate the timing and placement of ad breaks within the stream. The resulting manifest is not viewer-specific and can thus be cached by the CDN, making this solution highly scalable.
When the ad break is reached, the user’s device (video player) sends a personalized request to the ad server using the viewer’s targeting data, to ensure the delivery of a relevant advertisement. The video player then fetches the ad stream directly from the ad server, which is pre-transcoded and conditioned to match the content stream configuration. It then handles the ad insertion and playback so the advertisement and main content flow seamlessly without delays.
What makes SGAI work well is that the server and client device work in tandem to select targeted ads, while the client device is responsible for placing that ad rather than risking latency or technical interruptions when the server has to do both.
For example, Dolby’s advertising solution works as follows:
It’s also important to note the video player’s critical role in SGAI. In this context, the player evolves from an ending component in your video workflow to a pivotal orchestrator, enabling next-level ad experiences. It goes beyond playing content: with SGAI, the video player leverages insights regarding the platform, user, and session to collaborate with the server and deliver relevant ads with cross-platform compatibility.
This elevated role helps enhance experiences and support innovative formats like L-shape and double-box ads. The video player plays a critical part in achieving optimal latency by balancing buffer, device, and stream performance. As a result, the player is a key element not only for increasing viewer/fan engagement, but also opening up new opportunities for further monetization and sets new benchmarks for ad delivery and overall stream performance.
Distribution of the responsibilities depending on the ad-insertion technology are as follows:
| Responsibility | CSAI | SSAI | SGAI |
|---|---|---|---|
| Content streaming | Client | Client | Client |
| Break signaling | Client | Server | Server |
| Decisioning request | Client | Server | Client |
| Decisioning server | Server | Server | Server |
| Ad splicing | Client | Server | Client |
| Ad transcoding and serving | N/A | Server | Server |
| Ad playback | Client | Client | Client |
| Ad beaconing | Client | Server (*) | Client |
(*) Depends if a bespoke integration is built between the player and server (stitcher) to exchange meta-data.
What type of ads are used in SGAI?
Server-Guided Ad Insertion allows for a wider variety of ads to be placed within a stream. These advertisements can be before the stream begins (pre-roll), during (mid-roll), or after (post-roll). In addition to full replacement ads, SGAI can bring a number of innovative ad formats such as:
- L-shape ads, also known as squeeze back ads.
- Overlay ads.
- Companion ads.
- Double-box ads.
These formats are popular for live streaming as these open up possibilities to monetize key moments without disrupting the viewer experience with a full replacement ad.
Benefits of Server-Guided Ad Insertion
The streaming world is competitive, which means it’s essential to strike the right balance between monetization, viewer engagement and technical considerations. Key benefits of SGAI include:
- Simplicity with no long manifests or DVR window limitations: With SGAI, the player only reaches out to the ad-decisioning server when a break is legitimately scheduled. This removes the need to pre-populate the manifest with advertisements.
- Unmatched scalability and low risk: There is no central component in the backend (stitcher) that needs to scale to all viewers or impacts all viewers if something goes awry.
- Guaranteed ad delivery: With SGAI, the player only requests inventory when the ad break will be played. Unlike SSAI and CSAI, which struggle with static break durations and unplayable ads, SGAI dynamically adjusts break durations and serves ads that work flawlessly on any device.
- Enhanced analytics and monitoring: The player handles ad spicing and is fully aware of all ad breaks. This means the player has complete information on the viewer, device, and playback session, allowing for detailed analytics that grant in-depth insights into viewer behavior and ad performance.
- Real-time flexibility and low latency: There is no need to perform ad-decisioning calls ahead of time or when playback begins, improving the video’s startup time. Secondly, the just-in-time request for ad breaks makes SGAI highly applicable for low- latency streaming.
- Optimized viewer experience: The player controls the splicing process, so it’s aware of upcoming breaks, platform specifics, and content conditions. This feature empowers the player to select the optimal playback and insertion strategy tailored to these parameters.
- Agility and customization: SGAI lacks a central stitcher, eliminating a single point of failure that could impact all viewer sessions. This decentralization reduces risk and streamlines the adjustment-making process. Therefore, customers can adopt new features and roll out releases more efficiently.
- Cost-effective operations: Ad requests in SGAI only go out for ad breaks that will be effectively viewed. Through more insights into different sessions, the ad server knows upfront which ads are playable and relevant to the viewer. SGAI brings higher fill rates and rendering rates.
Cons of Server-Guided Ad Insertion
Server-Guided Ad Insertion (SGAI) is a newer ad insertion technique with a few drawbacks to consider.
- Limited vendor support: There are fewer server-side vendors supporting SGAI compared to Client-Side Ad Insertion (CSAI) and Server-Side Ad Insertion (SSAI). This limited support can make it challenging to find a suitable vendor for implementation.
- Player dependency: The player acts as the orchestrator in SGAI, meaning it needs to support this technique. Currently, only commercial video players, like Dolby’s THEOplayer, support SGAI. Native or open-source video players do not yet have this capability, which limits flexibility and options for developers.
- Evolving architecture: The architecture for SGAI is still evolving, and there isn’t a standard definition established by the industry. This lack of standardization can lead to inconsistencies and potential compatibility issues.
Given these challenges, it’s important to leverage a trusted partner, such as Dolby, who is leading the innovation of these technologies to ensure successful implementation and future-proofing.
Comparing SGAI, CSAI, and SSAI
We covered a few differences between the three ad insertion models earlier in this post, but now that you know more about SGAI’s benefits and how it works, it’s time for a more in-depth comparison.
| Feature or function | Client-Side Ad Insertion (CSAI) | Server-Side Ad Insertion (SSAI) | Server-Guided Ad Insertion (SGAI) |
|---|---|---|---|
| Method | Ads inserted on the client, by the player. | Ads stitched into the stream by the server. | Break signalling by the server, ad insertion by the player. |
| Personalization and targeting | Real-time targeted and personalised advertisement. | Limited personalisation as advertisements are prepared and inserted ahead of the viewer. | Real-time targeted and personalised advertisement. |
| Insights | High control on viewer insights and personalisation. | Challenging to get viewer insights and personalisation, requires bespoke integrations. | High control on viewer insights and personalisation. |
| Scalability | High – no dependency on server-side component | Low – requires server processing that has to scale with peak viewers (high cost) | High – no dependency on server-side component |
| Reliability | Prone to ad-blockers, difficult to get a good experience (buffering, latency). | More seamless experience, higher resilience for ad-blockers (tracking is impacted), but higher latency and start-up. | Resilient against ad-blockers and seamless experience. |
| Cross-platform support | Hard to implement across platforms due to characteristics and limitations of the platform. | Fast to achieve a basic experience cross-platform (although not all platforms). | High – but dependency on limited number of video player vendors. |
| Seamless ad experiences | Low – ad media files not adapted to the stream, can result in slow transitions or buffering. | Medium – switching between clear and DRM protected content could still disrupt the experience on smart TVs. | High – ads have smooth transitions and can be played alongside live content without the need for disruption. |
| Infrastructure cost | Low – uses the client / device. | Substantial processing required in the back-end, challenging to scale, harder to operate. | Low – uses mostly the client / device. |
| Ad inventory use | Medium – personalised ad requests need techniques like pre-bidding for higher rendering and fill rates. | Medium – stitcher is unaware of the viewer’s actions (such as seeking or tuning away), so costly decisioning calls may become irrelevant | High – ad requests will only go out for breaks that will be effectively viewed. Improved rendering and fill rates. |
Dolby’s Server-Guided Ad Insertion Solution
With Dolby’s recent acquisition of THEO Technologies, we now offer a revolutionary new advertising solution. This is a cutting-edge Server-Guided Ad Insertion service for both live and VOD content. The server dynamically manages and executes ad placements within your content, ensuring optimal timing and seamless integration for advertisements. The overall experience is more interactive and engaging— ads play seamlessly between, within, or around content, while remaining clickable, or offering QR codes, so viewers can engage with additional content.
With Dolby’s advertising solution, you can take advantage of:
- Better ad experiences, maximizing your viewers engagement with new ad formats without interrupting the content they are watching.
- Flexible ad scheduling, so you can retain full control over ad breaks by dynamically adjusting durations and scheduling through API or SCTE triggers,
- High scalability, allowing you to achieve unprecedented scale by eliminating the need for a central stitcher or session manager, and
- Enhanced ad analytics, maximizing your CPM value with in-depth insights into ad performance and user experience.
Conclusion
In conclusion, SGAI enhances viewer engagement through innovative formats and non-intrusive ads, leading to a more enjoyable experience that benefits both the viewer and the advertiser. It also boosts ad revenue by increasing fill and rendering rates, and offers technical improvements such as scalability and advanced ad insights, making it a valuable tool for modern advertising strategies.
Get in touch with us to learn more about how Dolby’s Server-Guided Ad Insertion solution can help boost your revenue and optimize viewer experiences at the same time.
