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  • Writer's pictureRussell Vilardi

Server-Side Ad Insertion vs. Client-Side Ad Insertion

Two roads are merging, illustrating server-side ad insertion.

There are two primary ways to insert ads into streaming video programming: server-side ad insertion and client-side ad insertion. Server-side ad insertion is a much different technology than client-side ad insertion, but they both have their pros and cons.

Which approach is better for your business? Read on to find out.

Key Takeaways

  • Server-side ad insertion (SSAI) stitches ads into streaming content in real-time

  • Client-side ad insertion (CSAI) preloads ads onto viewer devices

  • CSAI is good for live events and companies with limited budgets and technical capabilities

  • SSAI enables targeted programmatic advertising and personalized ad delivery with a seamless viewing experience

How Server-Side Ad Insertion Works

Service-side ad insertion (SSAI), also known as dynamic ad insertion (DAI) is a method to seamlessly insert ad content into streaming video programming. Unlike other ad insertion methods, SSAI enables a buffer-free transition from the surrounding programming to an ad block and then back to the programming. To users, SSAI ads look and feel just like the ads they’re used to on traditional broadcast television.

Unlike traditional broadcast advertising, however, SSAI enables advertisers to serve personalized ads to each viewer based on the advertiser’s targeting strategy and the viewer’s demographics, behaviors, and other relevant characteristics. Broadcast television, in contrast, serves the same advertising to all viewers, with no specific targeting possible. This enables advertisers to reach more targeted audiences with personalized advertising and achieve higher response rates than with broadcast campaigns SSAI works by intercepting content from an OTT streaming video service and then inserting targeted ads into the stream. This is possible because streaming video isn’t a single file, but a collection of smaller files transmitted over the Internet to viewers’ devices, where they’re assembled into the streaming program. The proper order of these files is determined by a streaming video manifest, which is also used to determine which ads are dynamically inserted.

Server-side ad insertion, illustrated.

The process works like this:

  1. A viewer selects which program to view.

  2. The viewer’s streaming TV or device sends a request for that program to the streaming service’s content distribution network (CDN). This request contains data describing the viewer’s demographics and other relevant characteristics, which are used in ad targeting.

  3. The CDN relays the viewer request to a third-party ad server.

  4. The ad server also receives a template manifest from the CDN containing markers that describe where ads should be inserted into the programming.

  5. The ad server sends a request to an ad decision server that include information about both the viewer and the number and length of available ad breaks.

  6. The ad decision server uses this information to determine the most appropriate ads from a pool of advertisers to display to each viewer for each ad break. The URLs for those ads are then sent to the ad server.

  7. The ad server adds the URLs for the ads to the manifest and sends that manifest to the viewer’s playback device via the CDN. There is a unique manifest for each viewer.

  8. As the programming streams to the viewer’s streaming device, that viewer sees the personally targeted ad inserted into the program at the designated ad breaks.

To viewers, this is a seamless process. The ads appear within the programming as if they’d been included from inception, even though they’re inserted in real-time.

Advertisers bid on available ad slots via programmatic advertising, which uses machine learning and artificial intelligence to automate the ad-buying process. Programmatic advertising also enables advertisers to micro-target their ads to specific viewers and have their ads follow customers across multiple services and media.

SSAI benefits all parties involved as follows:

  • For streaming services, SSAI offers viewers a personalized experience while maximizing ad inventory and enabling higher ad rates.

  • For advertisers, SSAI brings highly targeted audiences with high response rates, improving ROI.

  • For viewers, SSAI provides a smooth, broadcast-like viewing experience with interesting ads relevant to their lifestyles.

How Client-Side Ad Insertion Works

Client-side ad insertion (CSAI) is an older approach to serving streaming media ads. With CSAI, ads are inserted at the playback device rather than the content delivery service. This requires program playback to stop while ads are playing, then resume when those ads conclude.

When a streaming program nears an ad marker, it sends a request for an ad to the ad server, via an API call. The ad server delivers the ad just before the break occurs, enabling the viewer’s device to preload the ad.

Client-side ad insertion, illustrated.

CSAI is a simpler system than SSAI, but that simplicity limits its flexibility. Real-time dynamic ad insertion and programmatic advertising are not possible with CSAI, as ads have to be predetermined before playback. In addition, since programming and advertising are separate streams in CSAI, the viewer’s playback device has to constantly alternate between program and ads, which can be jarring for viewers.

On the plus side, CSAI enables skippable and closable ads, which some viewers like (even if advertisers don’t). CSAI is also easier to implement, especially for live and other linear programming formats. It’s less than ideal for on-demand programming.

Server-Side Ad Insertion vs. Client-Side Ad Insertion: Which is Best?

Because of its appeal to advertisers and on-demand streaming services, SSAI is the most popular ad insertion model today. DAI advertising is projected to show a 10% CAGR through 2030, with the global market for ad-insertion servers expected to reach $3.6 billion by 2027, up from $2.2 billion in 2020.

Both approaches have their place in today’s ad-supported video-on-demand (AVOD) market.

CSAI Pros and Cons

The benefits of CSAI include:

  • Lower-cost infrastructure

  • Easier to set up and run

  • Skippable and closeable ads

The downsides of CSAI include:

  • Lower ad fill rate

  • No real-time ad decisioning

  • Can’t handle programmatic ad requests

  • Less-than-ideal viewer experience

  • Can be blocked by ad blockers

SSAI Pros and Cons

The benefits of SSAI are many, including:

  • Programmatic advertising

  • Real-time ad decisioning

  • Seamless viewer experience

  • Microtargeted ads with a more personalized viewer experience

The downsides of SSAI include the following:

  • Higher-cost infrastructure

  • More technologically complicated

Which Method Should You Use?

CSAI may be a good choice for smaller or newer OTT services because of its lower cost and ease of setup. It’s also a good choice for live events that don’t have predefined commercial breaks and require real-time triggers for ad delivery.

SSAI, however, is better for services offering both linear and on-demand content. Many advertisers who want to micro-target specific audience types or individual customers also prefer it. SSAI also provides rich ad tracking and viewer metrics, which benefit both OTT providers and advertisers.

SSAI vs. CSAI for streaming ad insertion.

Let Penthera Help Optimize Server-Side Ad Insertion

SSAI, because of its complexity, can suffer from various technical issues, including dropped ads due to lengthy timeouts. Penthera’s 2nd Look solution minimizes these issues by enabling real-time ad decisioning. This helps OTT providers increase ad yield, deliver faster start-up times, and provide advertisers with a more effective means of reaching their targeted audiences.

Contact Penthera today to learn more about how server-side ad insertion works.

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