It ensures that each partner’s ad server receives a predetermined share of the available ad inventory, which directly impacts how advertising revenue is allocated.

Why is Inventory Share important?

When a FAST channel is monetized through advertising, multiple stakeholders, such as content providers and channel operators, enter agreements to share ad revenue. These agreements specify how much ad break time is assigned to each partner’s ad server.

There are several reasons why Inventory Share is necessary:

• Revenue Distribution: Since advertising revenue is a key source of income, partners need a fair and transparent way to split earnings.
• Flexible Allocation: FAST channels often work with multiple ad servers and monetization partners, making it necessary to have a dynamic system that adjusts the distribution based on predefined rules.
• Ad Server Waterfall Integration: Many FAST platforms use a waterfall approach, meaning ads are sourced from multiple providers in a prioritized sequence. This impacts how Inventory Share is calculated and adjusted over time.

Without Inventory Share, managing ad allocation fairly across multiple partners would be inefficient and could lead to disputes over revenue distribution.

How does Inventory Share work at RapidStream?

RapidStream uses an advanced rule-based system called AdRules to control when and how Inventory Share is applied. These rules are defined based on multiple parameters, such as:

• Geographic Targeting: Different Inventory Share rules can be applied based on the viewer’s country.
• Device Type: Rules can distinguish between streaming devices, smart TVs, mobile apps, and desktop viewers.
• Custom Parameters: Other criteria, such as content category, time of day, or audience segments, can influence Inventory Share allocation.

Ad Break Allocation Process

1. Defining the Inventory Share:

   • Each ad break is divided proportionally among the participating partners based on predefined percentages.
   • For example, if a 60-second ad break is available and there are two partners with a 50/50 Inventory Share, each partner’s ad server will receive 30 seconds of ad time.

2. Ad Server Prioritization & Waterfall Handling:

   • If a partner’s ad server does not fully utilize its assigned ad time (e.g., due to limited ad demand), the system invokes a Backfill mechanism.
   • Backfill allows the FAST channel’s own ad servers to fill the remaining time.
   • However, since this shifts the actual distribution of ad time, adjustments must be made in future allocations to maintain fairness over a longer period (e.g., across a month).

Example of Inventory Share with Backfill

• Partner A is allocated 40% of the ad inventory.
• Partner B is allocated 60%.
• Partner A’s ad server only fills 30% of the available time.
• The FAST channel’s ad server backfills the missing 10% to fully utilize the ad break.
• In the next allocation cycle, Partner A’s share might be increased to compensate for the previous shortfall and maintain the agreed-upon 40/60 split over time.

Key Benefits of Inventory Share

✅ Ensures Fair Revenue Distribution – Contractual agreements are honored dynamically over time.
✅ Optimizes Ad Fill Rates – Backfill mechanisms prevent wasted ad time.
✅ Supports Complex Monetization Models – Enables FAST channels to work with multiple ad partners while maintaining control over revenue allocation.

For a deeper technical breakdown, visit the RapidStream Ad Rules Documentation.