A Case for the Open Internet Coming out of LUMA’s DMS
There were four major trends highlighted at DMS by LUMA, the event for adtech leaders (and marketing hacks) put on by Terry Kawaja.
We are indeed in the Outcomes Era.
Every major adtech company will build or buy AI — fast.
Creators are shaping the future of the open internet (maybe).
The open internet, besieged by the walled gardens and now large language models, needs defenders.
These are trends Terry and Conor McKenna from LUMA presented or that I’m iterating on here based on my observations. Let me summarize what I think is most important in each and then synthesize them into a case for optimism about the open internet.
The Major Trends in Advertising
The Outcomes Era
Some folks, such as Adtech God, have recently asked why the word “outcomes” is suddenly everywhere when surely outcomes have always mattered. A couple of reasons.
First, Google, Meta, and Amazon are leaning into the term. As Zuckerberg said in the recent viral Stratechery interview, these companies want to become outcomes machines: “tell me what outcome you want and we’ll do the rest.” AI is making this easier.
Second, open internet adtech companies see this trend and are responding (the entire performance TV category could be interpreted as a response to this paradigm). That’s why I call it the Outcomes Era — it covers the walled gardens and the open internet.
But “Outcomes” doesn’t necessarily mean bottom-of-funnel (as some folks critically claim). As TTD CEO Jeff Green pointed out, the task is to define, measure, and argue for full-funnel outcomes against the breadth of content the open internet offers. And driving those outcomes with transparency gives open internet adtech companies an edge against the walled gardens. These are the wrinkles in the Outcomes Era: transparency/control and how much of the funnel a company is using to drive outcomes.
Build or Buy AI Fast
This was a humorously self-referential line by Terry. But it captures a very real dynamic in adtech: AI is transforming every aspect of advertising.
On our podcast Open Market, Eric Franchi pointed out this week that a panel featuring three Aperiam portfolio companies captured three very different domains of AI-driven adtech transformation: Firsthand (advertising and content interfaces and experiences), Swivel (ad ops automation), and Chalice (custom algorithms).
AI will change how we experience internet content itself, including ads, how the work of monetizing the internet, or operations, gets done, and how ads are bought and sold.
Every adtech company will either be part of this transformation or be transformed by it. For most companies, that means building or buying AI.
Creators Could Be the Future (or Demise) of the Open Internet
Unilever is reportedly 20x’ing the number of creators with whom it partners. Creators are in many ways the future of media. I’m too lazy to cite the numbers (I’ll leave that to Terry, who cited them onstage at DMS), but anyone paying attention to media knows that institutions like newspapers are losing steam while creators, empowered by cheap internet tools, take off. Plus, younger consumers (myself included) embrace creators’ authentic, opinionated, individualized content while increasingly eschewing media institutions.
The question is who will provide the platforms and monetization for these representatives of the next era of media. As of now, it’s not looking good for the open internet in that creators — who should in theory represent the democratizing promise of the open internet — are proliferating on a handful of platforms owned by some of the world’s largest tech companies (YouTube, TikTok, LinkedIn, X, etc.). Whether the open internet can provide a platform for these next-gen media professionals and organizations is central to the health of the open internet itself.
The Open Internet Needs Defenders
The open web is under siege — from the walled gardens, from LLMs, and from broader shifts in how consumers interact with content.
That’s bad for most of the adtech industry, bad for publishers, and bad for advertisers who benefit from competition, content diversity, and transparency.
If you work in adtech and your business depends on the open web, it’s not enough to compete with other players in the space. You have to advocate for the open web itself — as a place worth investing in, building for, and protecting.
The Case for the Open Internet
At DMS, Jeff Green argued that the open web is the strongest it’s ever been — with the most competition, the broadest content base, and the most potential for advertisers. His point: where else can you access every TV show ever made, plus real journalism and professional-grade content, in one place? That’s what advertisers get with the open web. And while I think there are some nuances to be litigated here (e.g. declining traffic, consumer choice, measurement, etc.), these are the broad strokes of a story more adtech companies should be telling.
Specifically, if we synthesize these trends — the shift to outcomes but with transparency and control; the AI-driven transformation of content and advertising experiences, ad ops, and ad buying and selling; the proliferation of creator content; and the ability to monetize deep, beloved, and diverse content in one place, I think we see the contours of a renewed and holistic case for the open internet, even amid the rise of likely new walled gardens.
To compete in the AI-driven Outcomes Era, the open internet must become a full-funnel outcomes machine: easily accessible; highly effective, iterative, and targeted; rooted in powerful consumer experiences; clearly measurable; and supported by the broadest and deepest array of content reaching billions of engaged consumers. Let’s break that down again. The open internet wins if it is:
Easily accessible for advertisers
Effective and outcome-oriented
Creatively captivating and experientially innovative
Clearly measurable, transparent, and easy to optimize
Able to reach and engage broad audiences due to content breadth and depth
The next wave of adtech companies is emerging to realize that future. When we make the case for the open internet, we must do so by referring to the competition and innovation fostering its outcomes-oriented, transparent, highly effective, accessible tomorrow.
The walled gardens are black boxes. The open internet is a transparent outcomes machine. Would that it becomes as much — because if it did, its total addressable market would expand, and big advertisers would have a compelling reason to stop giving the walled gardens the majority of their ad dollars. Every open internet adtech company must figure out how it fits into this system — and argue for the system as a whole.
