OpenX and Orange team up in an effort to crack display-ad market in Europe

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Pasadena’s OpenX, a maker of online advertising technology, has joined forced with France Telecom’s Orange group to create a marketplace for online display advertising that will compete with Google and other large online ad firms across Europe.

The new marketplace, launching sometime this quarter, will be called the Orange Ad Market, and will run on OpenX’s proprietary platform. OpenX’s model, known as an ad exchange, is built to allow advertisers to quickly find Web pages and other online real estate to paste up their messages -- and for the sellers of that space to get the price they’re looking for.

Orange is one of Europe’s major mobile and broadband providers in Europe and says its reaches nearly 343 million consumers monthly.

The market for display advertising -- the graphical ads users see displayed on Web pages and mobile devices -- is still fragmented, and has not yet been conquered by major players in the way keyword search marketing has. (In search marketing, a flower shop would pay to have their name show up alongside search results when users searched for ‘flowers’). Google, the leader in search advertising, has declared that bolstering their display ad business is among its top priorities.

But OpenX and Orange are trying to beat the titans to the punch by setting up a system they claim is more transparent and efficient than the ones run by their competitors.

‘We think we can build the market in Europe in a better, quicker way,’ said OpenX chief executive Tim Cadogan, who hoped that economic transparency in the way his market functions will be a selling point. OpenX will take a 20% commission on most transactions.

‘In other other models, that information is not to be found publicly -- and it’s variable,’ Cadogan said. ‘Generally people like to know, what’s the playing field I’m on?’

The announcement came just as word circulated that Yahoo, a big player in the online ad world, was shuttering its 5-year-old display ad network, apparently creating room in the market.

-- David Sarno