What changed in this filing

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Item 1. Business

2023-02-22 compared with 2022-02-23 · 104 added, 100 removed, 215 unchanged (49% of the section changed)

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On April 1, 2020, we completed a stock-for-stock merger with Telaria, Inc.

("Telaria" and such merger the "Telaria Merger"), a leading provider of connected television ("CTV") technology, and on April 30, 2021, we completed the acquisition of SpotX, Inc.

("SpotX" and such acquisition the "SpotX Acquisition"), a leading platform shaping CTV and video advertising globally.

Following the Telaria Merger and SpotX Acquisition, we believe that we are the world's largest independent omni-channel sell-side advertising platform ("SSP"), offering a single partner for transacting globally across all channels, formats and auction types, and the largest independent programmatic CTV marketplace, making it easier for buyers to reach CTV audiences at scale from industry-leading streaming content providers, broadcasters, platforms and device manufacturers.

("Telaria" and such merger the "Telaria Merger"), a leading provider of connected television ("CTV") technology, on April 30, 2021, we completed the acquisition of SpotX, Inc.

("SpotX" and such acquisition the "SpotX Acquisition"), a leading platform shaping CTV and video advertising globally, and on July 1, 2021, we acquired SpringServe, LLC ("SpringServe"), a leading ad serving platform for CTV.

Following these transactions, we believe that we are the world's largest independent omni-channel sell-side advertising platform ("SSP"), offering a single partner for transacting globally across all channels, formats and auction types, and the largest independent programmatic CTV marketplace, making it easier for buyers to reach CTV audiences at scale from industry-leading streaming content providers, broadcasters, platforms and device manufacturers.

Our platform features applications and services for sellers of digital advertising inventory, or publishers, that own and operate CTV channels, applications, websites and other digital media properties, to manage and monetize their inventory;

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These tools are particularly important to CTV sellers who need to ensure a TV-like viewing and advertising experience for consumers.

For instance, our "ad-pod" feature provides publishers with a tool analogous to commercial breaks in traditional linear television so that they can request and manage several ads at once from different demand sources.

Using this tool, publishers can establish business rules such as competitive separation of advertisers to ensure that competing brand ads do not appear during the same commercial break.

In addition, we offer audio normalization tools to control for the volume of an ad relative to content, frequency capping to avoid exposing viewers to repetitive ad placements, and creative review so that a publisher can review and approve the ad units being served to its properties.

On July 1, 2021, we acquired SpringServe, LLC ("SpringServe"), a leading ad serving platform for CTV.

SpringServe's ad serving technology manages multiple aspects of video advertising, including for CTV publishers, across both programmatic and direct-sold inventory, including forecasting, routing, customized ad experiences, and advanced podding logic.

On February 7, 2023, we introduced our unified CTV platform Magnite Streaming, which merges leading technology from the legacy Magnite CTV and SpotX CTV platforms.

The platform enables CTV sellers to maximize their advertising yield holistically across live and video on demand ("VOD") inventory, addressable linear, CTV and other over-the-top environments such as mobile.

Magnite Streaming unites sophisticated end-to-end features within a single platform and user interface, including:

comprehensive seller deal management capabilities to monetize across all deal types, whether reserved or sold upfront;

advanced curation and brand safety tools built for streaming video, such as ad-podding, a tool analogous to commercial breaks that allows a seller to manage business rules around competitive separation, audio normalization tools to control for the volume of an ad relative to content, frequency capping to avoid exposing viewers to repetitive ad placements, and creative review so that a publisher can review and approve the ad units being served to its properties;

multi-faceted audience activation features including seller defined audiences, third-party data integrations, and secure data matching;

responsive real-time reporting and dashboards;

and innovative technology to help sellers optimize live inventory.

In addition to these programmatic platform capabilities, our ad serving technology manages video advertising across both programmatic and direct-sold inventory, including forecasting, routing, and creating customized ad units.

The integration of SpringServe’s ad serving technology with our existing programmatic SSP capabilities provides CTV publishers a holistic yield management solution that dynamically allocates between direct-sold and programmatic inventory to drive value.

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Due to the size and complexity of the advertising ecosystem and purchasing process, manual processes cannot effectively manage digital advertising inventory at scale.

In addition, both buyers and sellers are demanding more transparency,

better controls and more relevant insights from their advertising inventory purchases and sales.

In addition, both buyers and sellers are demanding more transparency, better controls and more relevant insights from their advertising inventory purchases and sales.

This has created a need for software solutions, known as programmatic advertising, that automate the process for planning, buying, selling and measuring digital advertising across screens.

Programmatic buying enables the use of real-time bidding technology that allows for the dynamic purchase and sale of advertising inventory on an impression-by-impression basis.

Programmatic advertising allows buyers and sellers to transact on an impression-by-impression basis through the use of real-time bidding technology, and allows for the use of advanced data and identity solutions to better target ad campaigns.

Programmatic transactions include open auctions, where multiple buyers bid against each other in a real-time auction for the right to purchase a publisher's inventory, as well as reserve auctions, where publishers establish direct deals or private marketplaces with select buyers.

Programmatic has become the dominant method of transacting for desktop and mobile inventory and we expect it to continue to grow as a percentage of CTV advertising.

Programmatic is the dominant method of transacting for desktop, CTV, and mobile inventory.

Convergence of TV and Digital

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As such, we expect CTV to be a significant driver of our revenue growth for the foreseeable future.

We expect the recently completed acquisitions of SpotX and SpringServe to further fuel this growth.

Identity Solutions

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We believe that the elimination of third-party cookies has the potential to shift the programmatic ecosystem from an identity model powered by buyers that are able to aggregate and target audiences through cookies to one enabled by sellers that have direct relationships with consumers and are therefore better positioned to obtain user data and consent for implementing first party identifiers.

We believe that our platform and scale position us well to provide the infrastructure and tools needed for a publisher-centric identity model to succeed, and we are already enabling sellers to create audience segments with their first-party data.

In addition to actively working with sellers to develop solutions that could leverage their first party data, we are leading industry efforts to create standardized open identity solutions that ensure a smooth transition to a cookieless environment, and offer an alternative to proprietary solutions.

We believe that our platform and scale position us well to take a leadership position in advancing this shift and creating additional value opportunities for our clients.

Accordingly, we have invested and intend to further invest in the development and enhancement of industry leading identity and audience solutions.

In furtherance of this goal, in December 2021, we acquired Nth Party, Ltd.

("Nth Party"), a developer of cryptographic software for secure audience data sharing and analysis, and in February 2022, we acquired Carbon (AI) Limited ("Carbon"), a platform that enables publishers to measure, manage, and monetize audience segments.

We support industry privacy initiatives and believe that the next generation of identity solutions need to be open and ubiquitous, with consumer privacy, transparency and control at the core.

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Header bidding is a programmatic technique by which sellers offer inventory to multiple ad exchanges and supply side platforms, such as our platform, simultaneously.

Header bidding has been rapidly adopted in recent years in the desktop and mobile channels, and while the rise and rapid adoption of header bidding increased revenue for sellers, it has also created new challenges and technical complexities.

Header bidding has led to a significant increase in the number of ad impressions to be processed and analyzed through our platform as well as by DSPs, which can lead to increased costs if not properly addressed.

Header bidding has been rapidly adopted in recent years in the desktop and mobile channels and has experienced modest adoption in CTV.

The adoption of header bidding has created a number of challenges and technical complexities for both sellers and buyers, which require sophisticated tools to manage.

Header bidding has led to a significant increase in the number of ad impressions to be processed and analyzed through our platform as well as

by DSPs, which can lead to increased costs if not properly addressed.

We have invested in technology solutions, such as Demand Manager, to help publishers manage their header-bidding inventory.

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Winning bids can create advertising, or paid impressions, for the seller to present to the consumer.

The price that buyers pay for each thousand paid impressions

purchased is measured in units referred to as CPM, or cost per thousand, and the total volume of spending between buyers and sellers on our platform is referred to as advertising spend.

The price that buyers pay for each thousand paid impressions purchased is measured in units referred to as CPM, or cost per thousand, and the total volume of spending between buyers and sellers on our platform is referred to as advertising spend.

We generate revenue from the use of our platform for the purchase and sale of digital advertising inventory.

Generally, our revenue is based on a percentage of the ad spend that runs through our platform, although for certain clients or transaction types we may receive a fixed CPM for each impression sold, and for advertising campaigns that are transacted through insertion orders, we earn revenue based on the full amount of ad spend that runs through our platform.

We also generate revenue from the fee we charge clients for use of our Demand Manager header-bidding product and SpringServe ad server product, which we acquired on July 1, 2021.

We also generate revenue from our ad server and Demand Manager header-bidding product, where fees are either based on the number of impressions processed or a percentage of ad spend.

In addition, we may receive certain fixed monthly fees for the use of our platforms or products.

Competitive Strengths of Our Platform.

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Leadership in CTV

Our platform has been strategically built to meet the unique requirements of CTV sellers.

Many of these sellers have their roots in linear television and it is important that established business practices in television advertising can be translated to programmatic CTV advertising.

For instance, our ad-pod feature provides long-form content sellers with a tool analogous to commercial breaks in traditional linear television, so that they can request and manage several ads at once from different demand sources, in a single ad-pod.

In addition, we provide dynamic ad insertion to serve live streaming events, audio normalization tools to control for the volume of an ad relative to content, frequency capping to avoid exposing viewers to repetitive ad placements, and creative review so that a publisher can review and approve the ad units being served to its properties.

Our Magnite Steaming platform has been strategically built to meet the unique requirements of CTV sellers.

Many of these sellers have their roots in linear television and it is important that established business practices in television advertising can be translated to programmatic advertising.

In addition, we provide dynamic ad insertion to serve live streaming events, audio normalization tools to control the volume of an ad relative to content, frequency capping to avoid exposing viewers to repetitive ad placements, and creative review so that a publisher can review and approve the ad units being served to its properties.

We have invested significant time and resources cultivating relationships with CTV sellers and have built a specialized team of CTV experts across our engineering and sales functions to support our clients and evangelize the benefits of CTV advertising.

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Reserve Auctions

A significant portion of premium inventory is purchased and sold through reserve auctions where the seller establishes a direct deal with a buyer or group of buyers, in particular with respect to CTV.

A significant portion of premium inventory, in particular with respect to CTV, is purchased and sold through reserve auctions where the seller establishes a direct deal with a buyer or group of buyers.

These transaction types allow the seller to maintain tighter control over their advertising allocation and are often used by sellers that maintain a direct sales force but still want to experience the benefits of automation to improve pricing, matching, and dynamic ad placement and to automate manual operations such as ad trafficking, quality assurance, and billing and collections.

Our capabilities support sales functions rather than replacing them, which eliminates friction in the sales process.

Our deal management and curation tools support sales functions rather than replacing them, which eliminates friction in the sales process.

Buyers and sellers can also leverage their first-party data assets and third-party data assets in our platform to increase the value of sellers' inventory and the precision of buyers' targeting efforts.

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A core aspect of our value proposition is our big data and machine-learning platform that is able to discover unique insights from our massive data repositories.

Our systems collect and analyze a myriad of information such as historical clearing prices, bid responses, buyer preferences, ad formats, user location, buyer audience preferences, how many ads the user has seen, browser or device information, and sellers’ first party data about users.

browser or device information, and sellers’ first party data about users.

Our access to data puts us in a unique position to develop differentiated insights to help both buyers and sellers.

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This data also fuels our bid filtering technology, allowing us to more aggressively block traffic that is not likely to monetize.

We believe that our traffic optimization coupled with bid filtering improves return on investment for buyers and increases revenue for sellers, which in turn attracts more buyers and sellers to our

platform creating a dual network effect that makes our platform stickier.

We believe that our traffic optimization coupled with bid filtering improves return on investment for buyers and increases revenue for sellers, which in turn attracts more buyers and sellers to our platform creating a dual network effect that makes our platform stickier.

These capabilities also help us manage the costs associated with the high volumes of ad requests we receive.

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Transparency and Controls

We generate revenue each time an impression is monetized on our platform based on a simple and transparent fee structure established with our publisher partners, and do not collect any fees directly from buyers.

We generate revenue each time an impression is monetized on our platform based on a simple and transparent fee structure established with our publisher partners.

Our clients direct the sale and management of ad inventory through our platform, including the ability to define supply hierarchies and demand tiers, set minimum price floors, and establish advertiser and category level blocked and allowed lists.

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As a result, we are able to achieve a high degree of operating leverage, which positions our business for growing profitability.

We have a suite of buyer tools designed to improve ROI for buyers and help them meet their campaign strategies.

Our Direct Connect offering allows agency holding companies and major brands to create their own private label marketplaces and establish direct connections with sellers through our platform, while our custom auction packages provide buyers with a versatile and cost effective way of curating and targeting open market inventory based on categories such as audience, context, and viewability.

In addition, our innovative bid shading technology, Estimated Market Rate, helps buyers bid more effectively in a first price auction environment.

We provide a suite of buyer tools designed to help buyers curate inventory, append data and improve ROI in order to meet their campaign strategies.

Our curation tools include Express Lane and Marketplace technology that enable agency holding companies and major brands to create their own private label marketplaces and establish direct connections with sellers.

Custom auction packages give all buyers a versatile and cost-effective way to curate and target open market inventory, using categories such as audience, context, and viewability, while our deal discovery platform allows buyers to connect directly with sellers to arrange direct reserve auctions.

Our audience tools enable buyers to append data in order to reach their target

audience, and are often used in combination with our curation solutions.

Finally, Estimated Market Rate, our innovative bid shading technology, helps buyers bid more effectively in our environment.

We are fully aligned with the interests of our publisher clients.

Unlike some large industry participants, we do not have our own media properties that compete for advertising spending with our sellers.

Therefore, we are agnostic and have no

preference towards delivering demand to any specific publisher.

Therefore, we are agnostic and have no preference towards delivering demand to any specific publisher.

In addition, because we do not offer a demand side platform, we are able to avoid inherent conflicts of interest that exist when serving both the buy- and sell-side.

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We plan to invest significant resources in technology, sales and support related to our CTV growth initiatives.

Consistent with this growth objective, in April 2021, we completed the SpotX Acquisition, which we believe resulted in us becoming the largest independent programmatic CTV marketplace, and in July 2021, we completed the SpringServe Acquisition, which added ad server functionality to our platform, enabling us to manage both programmatic and directly sold inventory.

Consistent with this growth objective, in February 2023, we introduced Magnite Streaming, which merges leading technology from our legacy Magnite CTV and SpotX CTV platforms.

Supply Path Optimization

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We believe that the elimination of third party cookies has the potential to shift the programmatic ecosystem from an identity model powered by buyers that are able to aggregate and target audiences through cookies to one enabled by sellers that have direct relationships with consumers and are therefore better positioned to obtain user data and consent for implementing first party identifiers.

As the largest independent supply side platform, we believe we are well positioned to take a leadership position in advancing this shift and creating additional value opportunities for our clients.

In CTV, this identity model already largely exists with publishers more tightly controlling access to identifiers and user data, while offering proprietary first party data segments for reaching desired audiences.

As the largest independent supply side platform, we believe we are well positioned to take a leadership role in advancing the shift to a first party identity model and creating additional value opportunities for our clients.

Accordingly, we have invested and intend to further invest in the development and enhancement of industry leading identity and audience solutions.

In furtherance of this goal, in December 2021, we acquired Nth Party, Ltd.

(“Nth Party”), a developer of cryptographic software for secure audience data sharing and analysis.

In furtherance of this goal, in December 2021, we acquired Nth Party, a developer of cryptographic software for secure audience data sharing and analysis, and in February 2022, we acquired Carbon, a platform that enables publishers to measure, manage, and monetize audience segments, which have been integrated with our platforms.

Increase Efficiencies on our Exchange

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Increasing Seller Inventory

In order to increase the transaction volume on our platform we are continuously looking to add new high quality sellers to our platform and to expand our existing relationships with sellers to increase our share of their inventory, in particular in the CTV and OTT space where inventory is controlled by fewer sellers.

In order to increase transaction volume we are continuously looking to add new high quality sellers to our platform and to expand our existing relationships with sellers to increase our share of their inventory, in particular in the CTV and OTT space where inventory is controlled by fewer sellers.

Our plan for increasing our inventory volumes includes establishing and deepening our direct relationships with sellers, including through custom integrations, expanding our seller tools, capitalizing on our omni-channel capabilities, and leveraging our header bidding integrations, including through Demand Manager.

In addition, our acquisition of the SpringServe ad server provides us with access to inventory that is directly sold by a publisher's sales force by enabling a unified auction that selects an ideal ad set, considering both direct and programmatic deal priority and yield.

In addition, our acquisition of the SpringServe ad server provides us with access to inventory that is directly sold by a publisher's

sales force by enabling a unified auction that selects an ideal ad set, considering both direct and programmatic deal priority and yield.

Expand our International Footprint

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We plan to continue to expand our international presence and make additional investments in sales, marketing and infrastructure to support our long-term growth and to position ourselves for expected increases in the penetration of programmatic advertising globally.

We expect programmatic advertising to grow at different rates in different geographic markets, and are constantly evaluating new markets with a strategy to use our existing

infrastructure and adjacent sales offices or by expanding our infrastructure footprint and placing personnel directly in those markets.

We expect programmatic advertising to grow at different rates in different geographic markets, and are constantly evaluating new markets with a strategy to use our existing infrastructure and adjacent sales offices or by expanding our infrastructure footprint and placing personnel directly in those markets.

Continue to Innovate and Enhance our Platform

We are working on a number of platform innovations and enhancements designed to improve the value to our clients.

We are working on a number of platform innovations and enhancements designed to improve the value to our clients, such as our recently announced Magnite Streaming platform.

We intend to invest in new features that facilitate the creation of first-party publisher segments, improve upon our traffic optimization and bid filtering, enhance our brand safety controls, and help sellers to optimize their yield across both programmatic and directly sold inventory.

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Our CTV transactions run primarily on a hybrid infrastructure.

These two approaches optimize the type of traffic we handle - hosted data centers for high-frequency, low-latency transactions and cloud-supported for lower frequency transactions subject to more volatile viewing patterns, for example CTV prime-time viewing spikes.

We believe these two approaches optimize the type of traffic we handle - hosted data centers for high-frequency, low-latency transactions and cloud-supported for lower frequency transactions subject to more volatile viewing patterns, for example CTV prime-time viewing spikes.

Our approach supports the volume, diversity, and complexity of buyers’ bidding patterns, which increases market liquidity.

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Our industry is highly competitive.

Overall digital advertising spending is highly concentrated in a small number of very large companies that have their own inventory, including Google, Facebook, Comcast, Verizon, AT&T and Amazon, with which we compete for digital advertising inventory and demand.

These companies are formidable competitors due to their huge resources and direct user relationships, and will likely become even more dominant as third-party cookie use decreases.

Despite the dominance of large companies, there is still a large addressable market that is highly fragmented and includes many providers of transaction services with which we compete, including supply side platforms, video ad servers, and advertising exchanges.

Overall digital advertising spending is highly concentrated in a small number of very large companies that have their own inventory, including Google, Facebook, Microsoft, Comcast, and Amazon, with which we compete for digital advertising inventory and demand.

These companies are formidable competitors due to their huge resources and direct user relationships, and could become even more dominant as third-party cookie use decreases.

dominance of large companies, there is still a large addressable market that is highly fragmented and includes many providers of transaction services with which we compete, including supply side platforms, video ad servers, and advertising exchanges.

As we introduce new offerings, as our existing offerings evolve, or as other companies introduce new products and services, we may be subject to additional competition.

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There are many ways for buyers and sellers of digital advertising inventory to connect and transact, including directly and through many other exchanges, and buyers are increasingly demanding more transparency and lower transaction costs and establishing relationships directly with sellers of advertising inventory, which puts significant pressure on us.

Our offering must

remain competitive in scope, ease of use, scalability, speed, data access, price, inventory quality, brand security, customer service, identity protection and other technological features that help sellers monetize their inventory and buyers increase the return on their advertising investment.

Our offering must remain competitive in scope, ease of use, scalability, speed, data access, price, inventory quality, brand security, customer service, identity protection and other technological features that help sellers monetize their inventory and buyers increase the return on their advertising investment.

While our industry is evolving rapidly and becoming increasingly competitive, we believe that our solution enables us to compete favorably on these factors.

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Our team draws from a broad spectrum of experience, including data science, machine-learning algorithms, infrastructure, software development, and from experienced leadership on the seller and buyer sides, including CTV, mobile and video.

In addition to the United States, we have personnel and operations in the United Kingdom, Canada, France, Australia, New Zealand, Germany, Italy, Japan, Singapore, and Brazil in order to service buyers and sellers on a global scale.

In addition to the United States, we have personnel and operations in Australia, Brazil, Canada, France, Germany, India, Italy, Japan, New Zealand, Singapore, Sweden, and the United Kingdom, in order to service buyers and sellers on a global scale.

We strive to build a culture that is high-performing and results-oriented while emphasizing transparency, collaboration and innovation.

Our recruitment team seeks individuals that are committed to seeing the big picture and being catalysts of change.

We ask our employees to empower others, make a difference and ensure our company is a great place to work, not just a "job."

We ask our employees to empower others, make a difference and help make our company a great place to work, not just a "job."

Diversity , Equity and Inclusion

Our Magnify Council is focused on enhancing diversity, equity and inclusion.

Our objectives, through the support of the Magnify Council, are to create "the best" employee experience, continually deploy programs to develop diverse talent, and support external partners that emphasize the global promotion of diversity, equity and inclusion.

Our Magnify Council, a group of internal employees, rotating yearly, is focused on enhancing diversity, equity and inclusion.

Our objectives, through the support of the Magnify Council, are to create an exceptional employee experience, continually deploy programs to develop diverse talent, and support external partners that emphasize the global promotion of diversity, equity and inclusion.

Talent Retention

We reward team and individual excellence and are committed to creating an exceptional workplace environment in which we seek feedback from our employees in annual engagement surveys.

We reward team and individual excellence and are committed to creating an exceptional workplace environment in which we seek feedback from our employees in bi-annual engagement surveys.

We believe in continual feedback on performance.

Our employees set goals at a regular cadence throughout the year and managers provide achievement ratings.

Our employees set goals at a regular cadence throughout the year and managers provide achievement ratings at year-end.

We continue to invest in learning and leadership development by expanding our dedicated resources for these functions.

Our primary focus is to provide foundational skill development for the professional growth of employees, and

cohesive training for our global people managers.

Additionally, we routinely analyze voluntary employee turnover to understand and address trends.

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Employee Wellness and Safety

Due to the COVID-19 pandemic, our global workforce maintained a work from home policy for the entirety of 2021.

We believe that our employees have been able to work productively during the time period in which our global offices have been shut down.

We anticipate returning to our offices in spring 2022.

Due to the COVID-19 pandemic, our global workforce maintained a work from home policy from March 2020 through October 2022.

We have since returned to offices on a hybrid basis.

We have approached our return to offices with caution to prioritize the safety and health of our employees, and continue to monitor best practices and guidance.

We recognize that stressful circumstances require us to provide additional care for our employees.

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We have several issued patents and pending patent applications, some of which may ultimately be abandoned if we determine that the cost of prosecution or maintenance does not justify the utility of receiving the patent.

None of these patents has been litigated and we are not licensing any of the patents, and we do not believe that any individual patent or patent application is material to our business.

None of these patents has been litigated and we do not believe that any individual patent or patent application is material to our business.

Their importance to our business is uncertain and there are no guarantees that any of the patents will serve as protection for our technology or market in the United States or any other country in which an application has been filed.

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We also rely upon common law protection for certain trademarks.

We generally enter into confidentiality and invention assignment agreements with our employees and contractors, and confidentiality agreements with parties with whom

we conduct business, in order to limit access to, and disclosure and use of, our proprietary information.

We generally enter into confidentiality and invention assignment agreements with our employees and contractors, and confidentiality agreements with parties with whom we conduct business, in order to limit access to, and disclosure and use of, our proprietary information.

We also use measures designed to control access to our technology and proprietary information.

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While we work with many clients, a relatively small number of them provide a large share of the unique user audiences accessible by buyers.

This is particularly true in CTV, where sellers tend to be larger and more sophisticated compared to other online sellers.

This is particularly true in CTV, where sellers tend to be larger compared to other online sellers.

Given the limited number of CTV sellers, we are focused on building deeper, long-term strategic partnerships with these clients through a full-service business development strategy.

We have invested significant resources in identifying and cultivating these relationships and our sales executives and account managers often serve a consultative role within a client’s sales organization to help establish best practices and evangelize the benefits of programmatic CTV advertising.

This team is further supported by our product and engineering team with deep technical expertise, and for larger clients, we may build out custom features or functionality to help drive deeper adoption of our platform.

In the mobile channel, most of the application providers that make inventory available through our platform utilize system development kits ("SDKs") and other proprietary technology of third parties, such as aggregators, and it is those third parties, not the application providers themselves, that contract with us to help monetize the inventory.

Termination or diminution of our relationships with these third parties could result in a material reduction of the amount of mobile inventory available through our platform.

In the mobile channel, many of the application providers that make inventory available through our platform utilize system development kits ("SDKs") and other proprietary technology of third parties, such as aggregators, and it is those third parties, not the application providers themselves, that contract with us to help monetize the inventory.

Termination or diminution of our relationships with these third parties could result in a material reduction of the amount of mobile inventory

available through our platform.

We encourage application developers to use our own SDK when appropriate, but it is difficult to displace existing SDKs.

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These DSPs are directly connected to our technology through server-to-server integrations and are responsible for bidding on and purchasing advertising inventory on our platform pursuant to master service agreements.

We have relationships with almost all of the major DSPs, and because there are relatively few of them, each of these relationships is important to us and represents a source of demand that could be difficult for us to replace.

We have relationships with almost all of the major DSPs, and because ad spend is highly concentrated among relatively few DSPs, each of these relationships is important to us and represents a source of demand that could be difficult for us to replace.

We maintain close relationships with DSPs to maximize the amount of spend being transacted through our platform.

For instance, our sales team collaborates with DSPs to create custom private marketplaces that fit specific targeting criteria for a given campaign and our team of technical account managers continually monitors DSP bidding activities and provides recommendations that inform their trading practices.

For certain reserve auctions, the specific parameters of a campaign may be negotiated directly with the advertiser or agency without involvement of a DSP.

While the DSP is directly responsible for purchasing advertising inventory programmatically through our platform, the overall direction of an advertising campaign is typically determined by the advertiser or advertising agency that has engaged the DSP, and for certain reserve auctions, the specific parameters of a campaign may be negotiated directly with the advertiser or agency without involvement of a DSP.

In addition to transacting through DSPs, we also offer brands and agencies the ability to access our platform directly on a managed service basis through the use of insertion orders.

For these campaigns, our team of specialists manages the delivery and execution of the campaign according to an agreed set of objectives with the advertiser or agency, at a negotiated fixed price.

Accordingly, in order to increase the amount of spend transacted on our platform, and in furtherance of our SPO efforts, we must maintain close relationships directly with brand advertisers and agencies as well as with DSPs.

Accordingly, in order to increase the amount of spend transacted on our platform, and in furtherance of our SPO efforts, we expend significant resources establishing and expanding relationships directly with brand advertisers and agencies as well as with DSPs.

Geographic Scope of Our Operations

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We face staffing challenges, including difficulty in recruiting, retaining, and managing a diverse and distributed workforce across time zones, cultures, and languages.

These challenges have been exacerbated by the COVID-19 pandemic and the varying approaches of local governments.

We must also adapt our practices to satisfy local requirements and standards (including differing privacy

requirements that are sometimes more stringent than in the U.S.), and manage the effects of global and regional recessions and economic and political instability.

We must also adapt our practices to satisfy local requirements and standards (including differing privacy requirements that are sometimes more stringent than in the U.S.), and manage the effects of global and regional pandemics, recessions and economic and political instability.

Transactions denominated in various non-U.S.

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For detailed information regarding our revenue and property and equipment, net by geographical region, see Note 4 and Note 6 of the "Notes to Consolidated Financial Statements."

Our business is highly susceptible to emerging privacy regulations and oversight concerning the collection, use and sharing of data.

Data protection authorities in a number of territories have expressed a desire to focus on the advertising technology ecosystem.

In particular, this scrutiny has focused on the use of technology (including "cookies") to collect or aggregate information about Internet users’ online browsing activity.

Our business is highly susceptible to existing and emerging privacy regulations and oversight concerning the collection, use and sharing of data.

Data protection authorities in the United States and around the world have focused on the advertising technology ecosystem.

Because we, and our clients, rely upon large volumes of such data, it is essential that we monitor developments in this area domestically and globally, and engage in responsible privacy practices.

We do n ot collect information, such as name, address, or phone number, that can be used directly to identify a real person, and we take steps not to collect and store such information.

Instead, we rely on IP addresses, geo-location information, and persistent identifiers about Internet users and do not attempt to associate this data with other data that can be used to identify real people.

This type of information is considered "personal" in some jurisdictions or otherwise may be the subject of future legislation or regulation.

The definition of personal data varies by country, and continues to evolve in ways that may require us to adapt our practices to avoid violating laws or regulations related to the collection, storage, and use of consumer data.

We do n ot collect information that can be used directly to identify a real person, such as name, address, or phone number, and we take steps to avoid collecting and storing such information.

Instead, we rely on pseudonymous forms of data such as IP addresses, general geo-location information, and persistent identifiers about Internet users and do not attempt to associate this data with other data that can be used to identify real people.

Increasingly, this type of information is considered "personal" across various jurisdictions and is therefore governed by consumer privacy laws and may be the subject of future legislation or regulation.

The definition of personal data varies by country, and now even by U.S.

state, and continues to evolve in ways that may require us to adapt our practices to avoid violating laws or regulations related to the collection, storage, and use of consumer data.

As a result, our technology platform and business practices must be assessed regularly in each country in which we do business.

There are also a number of specific laws and regulations governing the collection and use of certain types of consumer data relevant to our business.

For example, the Children’s Online Privacy Protection Act ("COPPA"), imposes restrictions on the collection and use of data about users of child-directed websites.

With respect to COPPA, we have taken various steps to implement a system that:

For example, the Children’s Online Privacy Protection Act ("COPPA"), imposes restrictions on

the collection and use of data about users of child-directed websites.

With respect to COPPA compliance, we have taken various steps to implement a system that:

(i) flags seller-identified child-directed sites to buyers, (ii) limits advertisers’ ability to serve personalized advertisements on child-directed sites, (iii) helps limit the types of information that our advertisers have access to when placing advertisements on child-directed sites, and (iv) limits the data that we collect and use on such child-directed sites.

The use and transfer of personal data in the European Economic Area ("EEA") member states and the United Kingdom (“UK”) is currently governed by the General Data Protection Regulation and the UK General Data Protection Regulation (the "GDPR" and "UK GDPR").

The GDPR and UK GDPR set out higher potential liabilities for certain data protection violations and establish significant new regulatory requirements resulting in a greater compliance burden for us in the course of delivering our solution in the EEA and UK.

While data protection authorities have started to clarify certain requirements under GDPR and UK GDPR, significant uncertainty remains as to how the regulation will be applied and enforced.

In addition to the GDPR and UK GDPR, a number of new privacy regulations will or have already come into effect.

The California legislature passed the California Consumer Privacy Act ("CCPA") in 2018, which became effective January 1, 2020.

This law imposes new obligations on businesses that handle the personal information of California residents.

The GDPR and UK GDPR set out significant potential liabilities for certain data protection violations and establish significant regulatory requirements resulting in a greater compliance burden for us in the course of delivering our solution in the EEA and UK.

While data protection authorities have clarified certain requirements under GDPR and UK GDPR, inconsistent interpretations of the regulations and how to comply with them remain across individual countries.

In addition to the GDPR and UK GDPR, a number of recent privacy regulations will or have already come into effect in the United States.

California was the first state to enact an omnibus consumer privacy law in 2018, the California Consumer Privacy Act ("CCPA"), which became effective January 1, 2020.

This law imposes substantial obligations on businesses that handle the personal information of California residents.

The obligations imposed require us to maintain ongoing significant resources for compliance purposes.

Certain requirements remain unclear due to ambiguities in the drafting of or incomplete guidance.

Adding to the uncertainty facing the ad tech industry, a new law, titled the California Privacy Rights Act ("CPRA") recently passed as a ballot initiative in California and will impose additional notice and opt out obligations on the digital advertising space.

This law, which will take effect in January 2023, will cause us to incur additional compliance costs and impose additional restrictions on us and on our industry partners.

These ambiguities and resulting impact on our business will need to be resolved over time.

In addition, other privacy bills have been introduced at both the state and federal level.

Certain international territories are also imposing new or expanded privacy obligations.

In addition, amendments to the CCPA, along with broad-based consumer privacy laws in Connecticut, Colorado, Virginia, and Utah, will all take effect by the end of 2023 and impose obligations that are similar to the CCPA.

These new laws will cause us to incur additional compliance costs and impose additional restrictions on us and on our industry partners.

In addition, other privacy bills have been introduced at both the state and federal level and certain international territories are imposing new or expanded privacy obligations.

In the coming years, we expect further consumer privacy regulation worldwide.

Further, the European Union is expected to replace the EU ePrivacy Directive governing the use of technologies to collect consumer information with the ePrivacy Regulation.

Current drafts of the ePrivacy Regulation impose fines for violations that are materially higher than those imposed under the ePrivacy Directive.

The GDPR and UK GDPR also prohibit the transfer of personal data of EU and UK subjects outside of the EEA and the UK, unless the party exporting the data from the EU or UK implements a compliance mechanism designed to ensure that the receiving party will adequately protect such data.

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However, guidance on exactly what measures must be taken to allow the lawful transfer of personal data to the United States remains unclear.

While we will interpret the guidance and continue to explore the additional measures that can be implemented to protect personal data that is transferred to us in the United States, we remain subject to regulatory enforcement by data

protection authorities located in the EU, UK and the United States.

It is important to note that the EU and the US have agreed on a successor framework that is supposed to enter into force by the end of 2023 at the latest.

The new framework may not address all issues raised by the European Court of Justice and may be challenged in court, too.

Until that time, we remain subject to regulatory enforcement by data protection authorities located in the EU, UK, and the United States, so we will continue to interpret the guidance and explore the additional measures that can be implemented to protect personal data that is transferred to us in the United States.

By relying on these compliance measures, we risk becoming the subject of regulatory investigations in any of the individual jurisdictions in which we operate.

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We allow consumers to opt-out from the use of data we collect for purposes of behavioral advertising through a mechanism on our website, linked through our privacy policy as well as through portals maintained by some of these self-regulatory bodies.

Some of these self-regulatory bodies have the ability to discipline members or participants, which could result in fines, penalties, and/or public censure (which could in turn cause reputational harm).

Additionally, some of these self-regulatory bodies might refer violations of their requirements to the Federal Trade Commission or other regulatory bodies.

Until prevailing compliance practices standardize, the impact of worldwide privacy regulations on our business and, consequently, our revenue could be negatively impacted.

We support privacy initiatives and believe they will be beneficial to consumers' confidence in advertising technology, which will ultimately be positive for the advertising ecosystem in the long term.

However, until prevailing compliance practices

standardize, the impact of worldwide privacy regulations on our business and, consequently, our revenue could be negatively impacted.

For additional information regarding regulatory risks to our business, see "Item 1A.

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What changed 10-K

Item 1. Business