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Proximic's Mission: Ad Networks, Open for All

Proximic
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Proximic, an ad network built on a novel contextual-matching technology, is opening its doors to publishers of all sizes with a self-serve capability today, bringing it more directly in competition with Google's AdSense.

Launched in October, Proximic struck deals with eBay's Shopping.com and Yahoo's Shopping networks in January. But what was missing was a critical mass of publishers.

Until now, Proximic had agreements with individual publishers, turning over the code so they could receive ad placements from the Proximic's repository in what was a very manual process. Most of the publishers were based in Europe. With today's rollout of the self-service feature, the company expects to expand its network of publishers, particularly in the United States.

"This is really an evolutionary step of what we have been building, but it's still a very important one," Proximic CEO Philipp Pieper told InternetNews.com. "We wanted to make the model first. Now that we know that it's working, we're turning to the U.S. side of the business."

There is little mystery about who Proximic is targeting. Google's AdSense is a favorite solution for publishers looking to monetize their niche sites spread across the Internet's so-called "long tail" by selling ad space.

Google, which built its empire on selling ads next to search results related to the words in the query, has recently been talking up its plans to improve and expand its display business, particularly through the recently completed acquisition of online advertising powerhouse DoubleClick.

They're both going after the same market, but Proximic takes a different approach. Its signature feature is its "pattern proximity" technology, which infers the meaning of Web content without relying keywords or semantic inferences.

The false positives that keyword matches produce are familiar enough (Amazon: rain forest or Internet retailer?), so Proximic instead looks at the patterns of characters to infer the contextual meaning of a Web site, and place ads accordingly.

The first step in the young company's development was to gather enough ad units to make it attractive to publishers. Since the deals with Yahoo and eBay, Proximic has signed up Shopzilla and Amazon to create an ad supply that averages more than 50 million ad units on any given day.

The self-service feature will make the network more accessible to publishers, offering some basic dashboard reporting features with more planned for the next few months. Most ads are sold on a CPC (cost-per-click) model, with publishers getting paid monthly.

As it pursues the U.S. market more aggressively, Proximic plans to expand its operations in the Valley. Its headquarters are in Munich, and it currently maintains a small office in Palo Alto, Calif.

Pieper said that the United States, UK and Germany are the three principal markets where his company is focusing now, but that expansion into other markets might not be far behind, particularly since the pattern-proximity technology does not rely on a linguistic understanding of words.

In addition to building out its own network of publishers, Pieper said that he is pursuing the backfill business line, where Proximic would sign deals with other ad networks to sell ads against their unsold inventory.