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A majority of the advertising revenue is generated through online channels. Advertising through online channels has numerous features different from the traditional channels. The theory of online advertising involves the role of ad network software. The rising importance of ad network software is attributable to the fact that consumers usually refer to a large volume of online content in a short period of time. This makes it tough for advertisers to plan an advertising campaign, as an ad placed on numerous publisher websites can hit the same consumer several times.

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An ad network software handles this issue in two ways: firstly, it integrates the sale of advertising on different publishers. Secondly, it uses technologies such as data-driven tracking to extend the reach of campaigns. However, consumers worried about privacy can take actions to avoid being tracked. The tracking capability of an ad network software depends on the consumer’s choice to block tracking. The blocking by consumers may be at a low or high level.

In reality, when consumers decide to block tracking, they do not affect the externalities they execute on publishers. If ad levels reduce with increase in the efficiency of tracking, there may be constant blocking at equilibrium. This examination suggests that a privacy policy that lessens tracking by reducing the cost of blocking cookies may have severe effects on consumers.

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By combining inventory across numerous websites, ad network software can provide advertisers with the ability to reach the expected size of audience.

An ad network software generally functions on a cost-per-install and cost-per-click basis, facilitating more precise calculation of the average revenue per user (ARPU) and guiding the investment through cost-benefit analysis. There exist different types of ad networks, for example, forecasting. In forecasting, the information of inventory selling across publisher sites is tracked.