What the Tech are programmatic deals?

If you’re new to advertising, you might assume that buying and selling ad space would be straightforward.

The reality is far more complex. Over the last decade, the advertising ecosystem has exploded with new technologies, platforms and acronyms, making the process dizzying for newcomers — or even seasoned marketers.

In practice, the advertising supply chain can be a whirlwind. With the right tools and partners, it can also be straightforward.

In this installment of What the Tech, we’re going back to basics, breaking down what programmatic deals are.

So, what exactly is a deal?

At its core, a deal occurs when an ad buyer — typically a brand or its agency — agrees to purchase advertising space from a publisher. And “publisher” has a wide definition in digital media parlance. It covers traditional publications (The New York Times, The Cut), social media platforms (Facebook, X, Instagram, Snapchat), video platforms (YouTube, TikTok) and streaming TV services (Netflix, Hulu, Tubi) — pretty much anything that offers advertising space.

No matter who the seller is, the fundamental dynamics are the same. A publisher creates content. The content attracts an audience. The publisher then sells access to that audience to marketers in the form of ads.

Sounds easy enough. Why do you say it’s complicated?

For much of the history of advertising, this process was that easy. Marketers and publishers would hash out deals directly with one another, exchanging a certain amount of ad space for a particular price.

Digital media changed everything. Enter ad networks — which aggregated ad impressions from many publishers and sold them to marketers — and ad exchanges, digital auction houses that allow marketers to bid on unsold publisher ad inventory in real time (a process known as real-time bidding).

These intermediaries were supposed to make it easier for brands to execute cross-channel advertising campaigns, without having to negotiate one-off, direct buys with each individual publisher. But networks and exchanges brought with them new layers of complexity.

What makes ad exchanges complicated?

In theory, ad marketplaces should clear impressions at fair market value. In reality, many premium publishers fear that exchanges devalue their inventory by lumping it in with low-quality — or outright junk — sites. When top-tier publishers get tossed into the same bucket as bargain-bin inventory, buyers price everything like it’s bargain-bin. If you can’t tell whether you’re getting a sports car or a goat, you bid like you’re getting a goat.

In the early days of programmatic, this problem was baked in. The only inventory made available to exchanges was remnant — whatever publishers couldn’t sell directly. As publishers later tried to route more of their premium inventory through the same pipes, they lacked a reliable way to signal its higher value. Buyers simply saw a giant pool of impressions with no dependable markers to tell them, “These are the good ones.”

Without mechanisms to distinguish premium from everything else, even top-tier impressions got dragged down by the surrounding noise, leaving publishers frustrated and buyers flying blind.

To counter that, publishers introduced deal IDs, unique identifiers that let them package select inventory and audience segments into curated offerings. The goal was to help premium placements stand out amid the vast, undifferentiated pool of impressions flowing through an exchange.

What made deal IDs catch on?

Deal IDs were designed to help publishers package premium inventory and signal its value, while helping buyers avoid risky or irrelevant supply paths. In theory, they make it easier for premium buyers and premium sellers to find each other — the basic idea behind supply path optimization.

In practice, deal IDs impose limits, not guarantees. They’re not binding, they’re not self-enforcing, and they don’t contain metadata to verify what inventory is actually being delivered. To many buyers, a deal ID is a steel pipe: something comes through it, but you can’t see whether it’s what you agreed to buy. That opacity has even enabled the return of old-school arbitrage — “premium” deals stuffed with cheap impressions.

The industry is now shifting toward mechanisms that deliver the trust deal IDs were meant to provide: clearer definitions, verifiable deal parameters and transparency that helps buyers inspect what they’re getting — and helps premium publishers prove their value.

If those are deal IDs, then what are transaction IDs?

Given their names, you might assume that deal IDs and transaction IDs (TIDs) refer to the same thing. But this is ad tech, and nothing is ever that simple.

Publishers may often send the same impression to multiple ad exchanges simultaneously to maximize bids — and revenue. Great for them. For buyers? Not so much. Marketers can end up unknowingly bidding on the exact same impression across different exchanges, essentially competing with themselves.

TIDs fix that. Every impression gets a unique serial number that travels with it wherever it goes. Buyers can spot duplicates, avoid bidding twice on the same thing and save themselves from donating budget to the void.

Sounds fair enough. What’s the trade-off?

Even though TIDs seem like a reasonable solution to the duplicate bid problem, TIDs stir up a surprising amount of drama.

It’s more advantageous for publishers when marketers accidentally bid on the same impression multiple times. More bids mean higher chances of a top-dollar price. Buyers, unsurprisingly, would rather not outbid themselves.

The tension over this issue burst into full view last August when Prebid — the open-source header-bidding software widely used by publishers — disabled TIDs by default. Prebid said the existing TID implementation created privacy and interoperability issues and needed a fresh start. The practical effect, however, was that marketers lost one of the few tools they had to identify duplicate impressions across exchanges.

The critics of the old TID approach frame their objections around privacy and interoperability. They argued that impression-level identifiers exposed too much information about a publisher’s business. From their perspective, the industry needs a redesigned, formally governed alternative before reintroducing impression-level identifiers.

Supporters counter that impression identifiers are basic infrastructure for fairness and transparency. Without them, buyers lose the ability to detect duplicate bids, accurately value inventory and reduce waste. In an ecosystem already overloaded with complexity, removing one of the few signals that brought clarity feels like a step backward.

What’s the resolution?

There hasn’t been one yet. The industry is still sorting through the fallout. If a new method emerges to eliminate duplicate bidding, some parties will almost certainly try to blunt its impact. That part of the dance never changes.

Overall, though, the momentum in the ad tech industry is moving toward more transparency, not less. After years of complaints about the byzantine supply chain, there’s growing consensus that the programmatic ecosystem needs to mature into a more open, trustworthy marketplace.

A number of companies are introducing tools meant to restore clarity to programmatic auctions. Some go beyond patches and incremental fixes — pushing toward a higher-trust environment where better information leads to better bidding. Think of the way early eBay evolved: Few people once risked $5 on a baseball cap when it wasn’t clear what would arrive in the mail. But as trust and transparency improved, buyers became comfortable purchasing cars and rare collectibles. As confidence rose, prices followed, attracting higher-quality sellers — a flywheel spinning in the right direction.

Initiatives like The Trade Desk’s Deal Desk fit into that trajectory. They’re early signs that publishers and sellers are willing to experiment with more structured and transparent ways of bringing premium inventory to market. None of this solves everything overnight, and it certainly raises new questions about governance and fairness. But it does suggest that the industry is inching toward a more mature programmatic supply chain — one where serious buyers and sellers can transact with far more confidence.

As usual in ad tech, it’s a balancing act between innovation and equity.

Who said dealmaking couldn’t be fun?

The Current is owned and operated by The Trade Desk Inc.