Open-Source vs Hosted Ad Server: Which Is Better for Ad Networks and Why?

From Linux to Mozilla Firefox, over the years, open source software has proven to be a reliable business tool for all needs. But in the world of digital ads there are few companies who manage their ad campaigns with open-source solutions, preferring hosted ones instead.

The reasons are complex. You see, in 2023 successful advertising campaigns are fueled by software that optimizes buying activities, eliminates human errors, and simply prevents businesses from sinking into chaos. This ‘paladin’ software is called an ad server, and you’ve probably heard of it if you’re in ad tech for a while.

If so, you might have noticed that some solutions are free and open-sourced, while others belong to a company. This division results in a popular ad network dilemma: “Should I pay to use the services of a hosted ad server or save some money with open-source ad serving?”

Today we’ll dive a bit deeper into the differences between both open source and hosted solutions, dissect how each works, and figure out which option is the best for your advertising business.

What is an Ad Server?

For starters, let’s deal with the basics. To put it simply, an ad server is a piece of software that helps to manage, host, and serve ads. It hosts ads and delivers them to suitable placements based on your targeting and priorities.

Ad serving platforms come in a great variety and differ depending on:

• User’s access to placements (1st-party/3rd-party/unified);
• Creative type (display/video/rich media/mobile/native);
• Source code (open-source/hosted).

In this article, we focus on open-source vs. hosted ad servers, but you could check our dedicated ad server guide to get a more technical view of others.

What is an Open-Source Ad Server?

An open-source ad server is a freely available ad serving script to install on your own server. That is why those are also called "self-hosted ad servers". Moreover, full access to the code means you can tweak the script's configuration.

The idea of a free script with customization freedom is very tempting for smaller and larger ad networks. Yet their usage brings a lot of risks to the table, especially if you don’t have technical expertise. The label ‘free open-source ad servers’ means that this software is pretty basic and is often full of flaws due to not enough investments in its development.

For smaller ad networks, open-source software is mostly out of option, as it’s not reliable, which makes failure more likely. Most companies tend to choose hosted ad servers or build their own solutions. Why? Let’s dwell on the reasons in a Pros and Cons summary.

Benefits of Open-Source Ad Servers

Technology is free

Even the best open-source ad servers are free. You download the ready code and install it on your own server. Obviously, there’s more to just installing a script on the server, thus you’ll require technical expertise to run and maintain it correctly.

Code can be customized

Open-source software was made in mind to be modified. If you have a technical background, you can adjust the code to your ad serving needs. Another side of the coin is that you should involve human resources and spend tons of time to change massive chunks of backend code on your own.

Downsides of Open-Source Ad Servers

Server costs are on you

As the “self-hosted server” name suggests, you will require your own server to host creatives needed to run campaigns or fill up placements. This can get pricey, depending on your volumes. You’ll need approximately $5 per million requests, as well as at least $4K a year for server monitoring tools.

High maintenance costs are on you, too

Once you install the script, all maintenance work lies on the shoulders of your team. For example, if you aim for 500 million monthly requests, you’ll require at least 5 engineers with $125K salaries to keep 100% uptime, implement updates and fix bugs.

Moreover, if you need your server to generate revenue, get ready to spend another $100K a year on tools, certifications, and audits.

Insufficient security

Open-source ad server software is easier to compromise (because it’s open, cap). For example, in 2020, Revive’s server was attacked by a Tag Barnakle hacker group. They modified existing publisher ad creatives by appending malicious JavaScript code, delivering corrupted software to thousands of users.

Lack of support

Such software lacks any support because it’s free with only the script coming with a “package”. If you need info on how to set up your server properly, the road ahead lies in official forums and documentation.

Open-Source vs. API-Based Ad Server

The choice of ad serving software also has a third option to consider. There are large-scaled ad networks that build their own solutions using already developed APIs. Basically, you pay for a third-party API and receive a steady foundation to build your platform on.

Having installed them on your servers, you gain access to modules which you later combine to create your own solution. This approach requires a large team and high budgets, but the final result greatly exceeds capabilities of open-source software.

Despite its benefits API-based solutions aim at larger scaled ad networks. Buying somebody’s interface isn’t particularly cheap, so the choice between open source and hosted solutions remains a dilemma, not a trilemma.

Overall, ad networks with a “no-strings-attached” attitude may be hitting on open-source ad servers from first sight. They’re accessible, attractive, and… free. But what comes free has a high chance to turn out a disguised pain in the ass.

Building an ad network is a marathon, not a sprint. Hidden costs, hiring a tech team, and zero support cause shortness of breath faster than you think. So, if you want to succeed, it might be better to strive for a long-term relationship with a reliable partner instead. Now as we’ve explained what an open-source ad server is, let’s see what it's paid counterpart has to offer.

What Is a Hosted Ad Server?

A hosted ad server means that a vendor provides a server to host ads and a script to serve ads rolled into one.

Using a hosted ad server doesn’t differ that much from subscribing to Netflix. You pick the pricing plan, make your payment, and start using it at once.

Moreover, hosted ad servers usually come with technical support teams. Hidden costs you were about to pay with the open source server are already included in the price of a hosted one.

The base price may be pre-set or depend on traffic volume. Some ad servers like Epom base pricing solely on the number of impressions, while others may charge for extra features in their advanced pricing plans.

Sounds great, huh? Hold on, hosted ad servers have their benefits and downsides, too. So what about the other nuances?

Benefits of Hosted Ad Servers

Controllable scalability

Hosted ad server providers are known for controllable scalability. As your ad network grows, you can pay slightly more and move to the more advanced plan. Moreover, these servers are constantly improving to create a complete product in the competitive market.

What does this mean for you? You don’t need to hire a team of developers who would deal with adding more features once the network has grown larger. Many hosted ad solutions allow users to customize their platform by letting them change priorities, permissions, targeting etc.

With advanced subscription plans, providers could offer you more server space or even develop custom features. These can include support of certain DMPs, ad-block evasion, advanced video VAST tags, VPAID container support, etc.

No server & Maintenance cost

As we’ve already mentioned, there is no need to maintain a server and product since the provider does it for you. This may seem trivial at first, but this feature shines after long-term cooperation. In addition, most hosted software comes with guaranteed stable uptime.

Relevancy

Modern advertising is a highly competitive market which requires changing and adapting to stay relevant. Hosted solutions are constantly updating by improving security and adding features required on the market.

Such an approach gives you much more than any open-source banner ad server could offer, as the updates remain on the provider's side, while you focus on the product itself.

Better security and devops

When dealing with open-source software, the users have to set up privacy by themselves, instead of relying on an experienced devops team.

If the system is compromised (like in the case of Revive), developers release a security patch. Hosted software providers will automatically install it to your server to eliminate vulnerability. In the case of an open-source solution, you’ll have to set it up by yourself.

Technical support, not just documentation

Technical support teams will take care of your problems if any arise. Needless to say, 24/7 product support is far more reliable than forum threads and help center.

Downsides of Hosted Ad Servers

Data concerns

This one’s pretty individual, but working with a third-party vendor usually means sharing data. Still, some hosted ad solutions let you anonymize the information sent.

Pricing

We would hardly be sitting here if hosted ad serving was free. Pricing is the most obvious stopper for many businesses, but an open-source platform is cheaper just on first sight.

Once you realize how much money you save on server maintenance and support, a basic subscription will look like a more pleasant investment. With hosted ad serving you only invest in a subscription. There is no need to worry about further technical expenditures, until you grow larger.

Sometimes it’s easy to be tricked with advertising slogans and end up with crappy software and zero support, so we prepared a guide on how to choose an ad server to support you in that.

No access to backend

You always have code flexibility with self-hosted ad servers, but that’s rarely the case for hosted ones. It’s true that they already come with most features you’d expect, some of these services even develop the required features. Still, you may lack some code freedom to implement plug-ins and updates, so if you want more features, you’d require to order custom development.

Open-Source vs Hosted Platform Examples: Revive vs Epom

Okay, you’re probably tired of metaphorical software and its indirect comparison, so let’s clash the bosses from both worlds. In the red corner, we have Revive’s open-source script, one of the world’s most popular free open-source ad servers. In the blue corner, there is Epom, a pinnacle of ad serving with 10+ years of experience.

We’ll compare these two in terms of pricing, features, and unique selling points. Let the battle begin!

Save Table’s Desktop Version

That sure is informative, yet we have even more. If you want to see how well Epom competes with other hosted solutions, we analyzed 20+ market solutions and compared the best ones.

Is a Self-Hosted Ad Server Good to Start an Ad Network?

As you can see, even the best open-source ad server is lacking many features and support when it comes to direct comparison with a hosted alternative.

Clients expect performance from their ads, so if your ad network doesn’t keep the uptime – you lose them to competitors. Open-source software requires complex set up and further hussle with extending the product. Moreover, open-source software is hardly an affordable solution, if you count the price of its maintenance.

So even though it looks lucrative, it’s better to go for a basic plan of a hosted ad tool that will guarantee you steady performance and marketing growth. Besides, Epom has a 14-day free trial to see if it matches your expectations.