The MediaMath bankruptcy serves as a reminder of one of the inherent deficiencies in the programmatic ecosystem. Publishers, the backbone of our industry, often receive the short end of the stick, especially when the chips are down.

With the rapid, real-time transactions in programmatic, actual payments usually lag behind, causing imbalances in the cash flow. And as the fall of MediaMath shows, this comes at the cost of resilience. Herein sequential liability clauses are certainly pragmatic for SSPs – at least on paper – but ultimately, they just kick the financial risk downstream.

However, the relationship between publishers and SSPs should be symbiotic, underpinned by transparency and trust. Drawing from one of the most developed industries in terms of risk management – the financial sector – the concept of ‘shared risk’ may offer a more sustainable paradigm. The idea that all partners share in both the benefits and risks of transactions builds trust, ensures proper due diligence is conducted at all stages, and deters single-party vulnerabilities.

Publishers rightfully ask for more robust evaluation of DPSs financial health. Here again, the financial sector offers a potential solution. A framework that mirrors the mechanics of credit scores for example, would offer a more transparent and rigorous risk assessment for all parties.

Ultimately, MediaMath’s bankruptcy is not about a single company’s financial issues and its effects. It should call for an industrywide introspection of the programmatic foundations to find the right balance between speed and resilience to these types of shocks.

MediaMath's bankruptcy fallout is hitting publishers as supply-side platforms (SSPs) Magnite, PubMatic, and Wunderkind seek to recoup revenue paid to publishers from deals made on MediaMath's demand-side platform (DSP). 

Sequential liability clauses in contracts usually protect SSPs from paying publishers if upstream partners default. The bankruptcy left several SSPs with significant unpaid amounts, with Magnite and PubMatic listed as the two largest creditors in the filing. However, some SSPs, including GumGum, 

Colossus, Index Exchange, and Google Ad Manager, stated they won't pursue clawbacks, citing potential harm to publishers. The fallout is leading publishers to rethink contractual relationships and seek ways to mitigate similar future incidents.