DSP vs SSP: Programmatic Advertising Explained

DSP vs SSP: what is the difference?

A DSP (demand-side platform) is software that advertisers and agencies use to buy ad impressions automatically, across many websites and apps, by bidding on each one. An SSP (supply-side platform) is software that publishers use to sell those impressions, by offering each ad slot to many buyers at once and accepting the best bid. The DSP works for the buyer and tries to pay as little as possible for the right audience; the SSP works for the seller and tries to get the highest price. They meet in an auction that usually runs in well under a second, while the page or app is loading.

That automated buying and selling is called programmatic advertising, and the per-impression auction at its core is real-time bidding (RTB). This guide explains each piece in plain terms, then shows where offerwalls, which are paid per action and not per impression, fit in.

The players in programmatic advertising

Five kinds of platforms come up again and again. Several companies run more than one of them, which is why the labels blur.

An ad network is the older, simpler model: one company collects inventory from many publishers and sells it to its own advertisers. Many ad networks now buy and sell programmatically too, so the line between a network and an exchange is no longer sharp.

Example platforms

• DSPs: The Trade Desk, Google Display & Video 360 (DV360), and Amazon DSP.
• SSPs and exchanges: Google Ad Manager, Magnite, PubMatic, and Index Exchange.

Google Ad Manager is a good example of how platforms overlap: it is both a publisher ad server and a sell-side exchange. These are well-known names, listed as examples, not as a ranking.

How real-time bidding works, step by step

IAB Tech Lab, which maintains the industry standard for this process, describes RTB as a way of trading media in which each individual ad impression is put up for bid. Here is what happens each time a page or app has an ad slot to fill:

1. A user opens a page or app screen with an ad slot. The page or app SDK calls the publisher’s ad server or SSP.
2. The SSP builds a bid request. It describes the slot (size, format, position), the site or app, the device, a rough location, and any user identifiers the user’s consent allows, such as a mobile advertising ID. It also includes a price floor and a deadline.
3. The request goes out to many DSPs at once, directly or through exchanges.
4. Each DSP evaluates the impression against its advertisers’ campaigns: audience, budget, frequency caps, brand safety, and fraud filters. If it is interested, it returns a bid with a price and the ad markup. If not, it passes.
5. The auction runs. The SSP compares the bids, along with any direct deals in the publisher’s ad server, and the highest qualifying bid wins.
6. The winning ad loads in the slot, the winner is notified, and impressions are counted and billed, usually on a CPM basis.

All of this has to finish before the user scrolls past or the screen changes, so every bid request carries a time limit. In the OpenRTB standard it is the tmax field, in milliseconds. Each exchange sets its own value. Google’s Authorized Buyers guide says its deadline “typically ranges from 80 to 1000 ms”, and Unity’s exchange documentation suggests bidders respond within 200 ms. A bid that arrives late is simply not counted.

OpenRTB: the common language

DSPs and SSPs can talk to each other because they use the same protocol. OpenRTB is a set of open specifications maintained by IAB Tech Lab; the project started in 2010 as a group of buy-side and sell-side technology companies. Version 2.6 is the newest 2.x release on IAB Tech Lab’s page, with dated updates published on GitHub, and a separate OpenRTB 3.0 also exists. Exchanges publish which version they support, so a DSP can read the same fields (slot size, device, tmax, floor) from every source. Checked on October 20, 2026.

DSP vs SSP at a glance

Auction types and deal types

First-price vs second-price auctions

In a second-price auction, the winner pays just above the second-highest bid. In a first-price auction, the winner pays what it bid. Programmatic display used second-price auctions for years, but the market has largely moved to first-price, and the biggest single step was Google. In its September 2019 post, Google said it was moving Ad Manager to “unified first price auctions” and that its tests showed first-price auctions had a neutral to positive effect on publishers’ total revenue compared with second-price auctions.

First-price auctions are simpler to understand, but they reward bidding exactly what an impression is worth to you. Many DSPs use “bid shading”, which estimates the lowest bid likely to win, so advertisers do not overpay.

Open auction, private marketplaces and programmatic guaranteed

Not every programmatic sale is an open free-for-all. Publishers can limit who buys and on what terms:

Each deal carries a deal ID in the bid request so the DSP knows which agreement applies. Premium publishers often sell their best placements through private deals and let the open auction fill the rest.

Header bidding and in-app bidding

Before header bidding, a publisher’s ad server often offered an impression to one demand source at a time, in a fixed order. Header bidding asks several SSPs for bids at the same time, before the ad server decides. The open-source project Prebid describes it this way: “the publisher creates a short delay in their ad serving to obtain bids that might be used in the ad decisioning.” Prebid offers Prebid.js, which runs in the browser, Prebid Server for server-side auctions, and the Prebid Mobile SDK for iOS and Android apps.

In apps, the same idea is usually called in-app bidding or mediation bidding. A mediation platform such as AdMob, AppLovin MAX or Unity LevelPlay runs a real-time auction among the networks and exchanges connected to the app, and keeps a waterfall for sources that cannot bid. What is ad mediation? explains waterfalls, bidding, and hybrid setups in detail.

ads.txt, app-ads.txt, sellers.json and supply path optimization

Because an impression can pass through several companies before it reaches a buyer, fake or resold inventory is a real risk. IAB Tech Lab created three public files to make the chain checkable:

• ads.txt: a text file on the publisher’s own domain that lists every company allowed to sell its inventory, with the publisher’s account ID at each. Each line is marked DIRECT (an account the publisher controls) or RESELLER (a third party that resells it).
• app-ads.txt: the same idea for apps. Google’s AdMob help page says the file goes in the root of the developer website listed in your Google Play or App Store listing, which is how the standard “establishes who owns an app”.
• sellers.json: published by SSPs and exchanges, it lists the sellers and intermediaries they work with, so buyers can see who is actually selling.

Together they let a DSP check that an impression claiming to be from a given site or app is sold by a company that site or app authorized. A missing or outdated file can make buyers skip your inventory, which shows up as a lower fill rate.

Supply path optimization (SPO) is what buyers do with this information. The same impression is often offered by several SSPs and resellers at once. Rather than bid through all of them, a DSP or agency picks the shortest, cheapest and most trustworthy paths to each publisher and drops the rest. For publishers, the practical result is simple: keep your ads.txt or app-ads.txt current and avoid long reseller chains.

Fees: what the “ad tech tax” is

Every platform between the advertiser and the publisher takes a share. People call the total the “ad tech tax”. The best-known measurement comes from the UK. In May 2020, ISBA and PwC published a Programmatic Supply Chain Transparency Study that followed real campaigns end to end. It found that publishers received 51% of advertiser spend on average, and that 15% of spend, about a third of supply chain costs, could not be attributed to anyone. The study called that gap the “unknown delta”.

Two caveats matter. The study covered premium UK advertisers and publishers, so it does not describe the whole market. And things improved: ISBA’s second study, published in January 2023, found the unknown delta had fallen to 3% and the impression match rate had risen from 12% to 58%, while warning that the results “should not be taken as representative of the broader programmatic ecosystem”.

Where offerwalls and CPA offers fit

Everything above is about selling impressions: the advertiser pays for the chance to show an ad, priced per thousand views. Offerwalls work on a different model. The advertiser pays only when a user completes a defined action, such as installing an app and reaching a level, signing up, or finishing a survey. That is cost per action pricing, and CPM vs CPC vs CPA compares the models.

So an offerwall sits outside the RTB auction:

• There is no bid request per impression and no DSP or SSP. Offers come from advertisers, often through a CPA network, at an agreed payout per action.
• The user chooses an offer and completes it, often for a reward in your app’s currency. What is an offerwall? covers the model.
• The result is reported by a server-to-server postback after the advertiser confirms it, and it can be reversed later if it turns out to be invalid.

Many apps run both: programmatic ads through mediation for banners, interstitials and rewarded video, and an offerwall as a separate “earn more” screen. Because the offerwall pays per action, it does not compete with your ad slots for the same impression. What are rewarded ads? compares the rewarded formats side by side.

Frequently asked questions