(that is to say contextual and display ads, excluding classifieds and e-mail) would represent EUR 2.8 billion.20
Ad space can be sold directly by publishers to advertisers through their sales forces or through intermediaries. In very general terms, intermediaries "pool" advertising space made available for sale by publishers and/or advertisers wishing to buy advertising space and facilitate the matching between the supply of ad space and the demand for ad space to place ads.
Publishers generally distinguish their available advertising space into "premium" and "remnant"21. Premium inventory is more valuable to advertisers as it usually consists of the most visible space on a website (e.g. the top space on the most popular pages (such as the homepage) of important online magazines or newspapers). Advertisers are willing to pay a high price for this space and generally purchase it directly from publishers. The less valuable inventory, "remnant inventory", which is more likely to remain unsold, may benefit from intermediated sales as these will increase (through pooling) the probability to find advertisers interested in placing an ad and therefore generate ad revenues for publishers. Both premium and remnant inventory can be sold through either direct sales or intermediated sales. However, premium content is more likely to be sold directly, in particular by large publishers with direct sales teams, whereas remnant inventory tends to be sold indirectly via intermediaries22. While smaller publishers can also have direct sales team, it is more likely that a small publisher will use intermediation for its entire inventory.
20. Intermediation services are offered by "ad networks" or "ad exchanges" and, to some extent, by "media agencies". An ad network is a two-sided platform serving (i) publishers (websites) that want to host advertisements, and (ii) advertisers that want to run ads on those sites. Ad networks aggregate ad space inventory thus maximizing revenue opportunities and minimizing administrative costs of selling the ad space for the publisher. From an advertiser's point of view, an ad network can be considered as a "single buying point" for online inventory
(i.e. 45% of EUR 8 billion minus Google’s non-search advertising revenues, which amount to EUR […]* million according to the notifying party.
According to the IAB report, the non-search advertising segment (excluding classifieds and e-mail) accounts for 31% of the total European online advertising market. However, for the reasons given in footnote 19, the correct size of the non-search segment according to IAB is 36% of the total online advertising market of EUR 8 billion (i.e. 31% of EUR 8 billion plus Google’s non-search advertising revenues of EUR […]* million).
There are in fact several categorizations of online inventory: premium, reserved, non-reserved, remnant or unsold. For the purpose of this decision only the most frequently used categorization (Premium/remnant) will be retained.
The distinction between premium and remnant inventory is a matter of the publisher's audience profile and its capacity to carry advertising (i.e. generate demand by advertisers). Larger publishers (i.e. publishers with a larger “reach”) are not necessarily those whose inventory carries more advertising, although scale may be relevant.