Less Traffic, Better Outcomes: Competition-Aware Request Dispatch in Real-Time Ad Exchanges

arXiv:2608.03705v1 Announce Type: cross Abstract: Real-time bidding (RTB) ad exchanges typically forward nearly all incoming requests to demand-side platforms (DSPs), even though only a small fraction receive bids. This over-distribution weakens auction outcomes: DSPs throttle participation under compute and budget constraints, reducing the effective use of limited bidding capacity. We present a competition-aware request dispatch framework that uses distributional bid prediction and probabilistic forwarding to decide whether each request should be sent to each DSP. The system adapts per-DSP thresholds over time through lightweight policy optimization to track non-stationary market conditions. We evaluate the framework through four sequential online experiments on a production platform serving over 20 billion daily requests. A full multi-DSP deployment reduces DSP request volume under the policy by 34.2% while increasing net revenue by 4.6% (p<0.001) in a recent 14-day window after an initial DSP adaptation period. Further analysis highlights strong heterogeneity across traffic segments and reveals that aggregate metrics can be misleading. Segment-level and per-DSP analyses suggest that the policy surfaces comparative advantages among DSPs, improving monetized outcomes without increasing overall request volume.

Abstract:Real-time bidding (RTB) ad exchanges typically forward nearly all incoming requests to demand-side platforms (DSPs), even though only a small fraction receive bids. This over-distribution weakens auction outcomes: DSPs throttle participation under compute and budget constraints, reducing the effective use of limited bidding capacity. We present a competition-aware request dispatch framework that uses distributional bid prediction and probabilistic forwarding to decide whether each request should be sent to each DSP. The system adapts per-DSP thresholds over time through lightweight policy optimization to track non-stationary market conditions. We evaluate the framework through four sequential online experiments on a production platform serving over 20 billion daily requests. A full multi-DSP deployment reduces DSP request volume under the policy by 34.2% while increasing net revenue by 4.6% (p<0.001) in a recent 14-day window after an initial DSP adaptation period. Further analysis highlights strong heterogeneity across traffic segments and reveals that aggregate metrics can be misleading. Segment-level and per-DSP analyses suggest that the policy surfaces comparative advantages among DSPs, improving monetized outcomes without increasing overall request volume.

Artificial Intelligence (cs.AI); Machine Learning (cs.LG)

arXiv:2608.03705 [cs.AI]

(or arXiv:2608.03705v1 [cs.AI] for this version)

https://doi.org/10.48550/arXiv.2608.03705 Focus to learn more arXiv-issued DOI via DataCite (pending registration)

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Less Traffic, Better Outcomes: Competition-Aware Request Dispatch in Real-Time Ad Exchanges

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