If you are a content producer or a freemium app or game developer, you would know, instantly, what I am talking about: there is WAY too much ad inventory out there. Too many eyeballs that are not getting adequately monetized. Major publishers sitting on top of huge masses of unmonetized impressions. Game developers monetizing, barely, 1-2% of their traffic. App developers, similarly, struggling to convert free users to premium.
If you are an entrepreneur, looking for an open problem to solve, look no further. This is your opportunity. In 2012, one of the greatest unaddressed pain points for the Mobile and Online industries is this over abundance of eyeballs that publishers, software, app and game developers are struggling to find monetization models for.
There are many Ad Networks that offer very low monetization rates and take a large sales commission. If you decide that the way you want to address all this is by becoming, yourself, an ad network, that is certainly one way of addressing the pain-point. However, you would need to know how to sell $25-50 CPMs, because at $4-5 CPMs, there is no money for anybody. Not for the network, and not for the publisher. It’s just not worth it. Some vertical ad networks have gone after this opportunity, Glam Media being one of the most successful of the lot.
But, by and large, the problem remains unsolved from the publishers perspective.
Now, if you are an entrepreneur looking for cheap advertising, this actually plays in your favor. However, most ad networks don’t have the kind of self-service mechanisms of buying ad impressions that Google AdSense has, for example. This is a limitation on the side of Ad Networks, who would actually monetize a lot better if they were to open their inventory up to the small-medium businesses.
Now, if you are an Ad Network with the ability to service a large pool of SME advertisers, I would like to hear from you.