TL;DR: Programmatic buyers reduce intermediaries by moving a portion of their spend from open auction into bilateral channels where they deal directly with publishers through a neutral marketplace. The three practical steps are: auditing the current supply path to identify where fee extraction is occurring, identifying which inventory is valuable enough to justify direct bilateral deals, and deploying the mandate and agent infrastructure needed to run bilateral deals at scale.

Supply path optimisation has been a buyer priority for several years, but progress has been limited by the complexity of the conventional programmatic supply chain and the lack of a credible alternative for buyers who want to deal more directly with publishers without building and maintaining hundreds of individual direct relationships.

Agent-to-agent bilateral negotiation changes the alternative. A buyer can now deal directly with publisher sell-side agents through a neutral marketplace, without managing a direct relationship with each publisher individually. The agent handles the negotiation; the marketplace holds the deal record; the buyer's team manages the mandate framework that governs the agent's decisions.

This makes supply path reduction practical at scale in a way it was not before.

Step one: audit the current supply path

Before reducing intermediaries, buyers need to understand where fees are being extracted in their current supply chain. ANA's 2023 programmatic transparency study found that a substantial proportion of programmatic spend does not reach the publisher: it is absorbed by DSP fees, SSP fees, data fees, verification fees, and the fees of other intermediaries in the chain between the buyer's budget and the publisher's inventory.

The audit involves identifying, for a representative sample of spend, how much of the buyer's media budget reaches the publisher as net revenue. This requires access to supply path data from the DSP, which not all DSPs provide in a format that makes this calculation straightforward. Buyers who do not have this data should request it from their DSP before making supply path decisions.

The audit typically reveals that the supply path varies significantly by inventory category. Premium publisher inventory often routes through fewer SSP hops than long-tail inventory. Open exchange inventory from large publishers may already be accessible with one SSP hop. Understanding the actual supply path for the buyer's specific inventory mix is the starting point.

Step two: identify which inventory justifies direct bilateral deals

Not all inventory benefits equally from bilateral deals. A bilateral agent-to-agent deal makes sense when the inventory is valuable enough to the buyer that the negotiation overhead is worth the supply chain savings, and when the publisher has the infrastructure to support an agent-negotiated deal.

High-value publisher relationships, where the buyer is already spending a significant amount and where the inventory delivers proven results, are the natural starting point. These are the deals where reducing intermediary fees has the highest absolute impact, and where both parties have enough at stake to invest in the bilateral deal infrastructure.

Inventory where the buyer is price-sensitive and where the publisher has a clear price floor is also well-suited to bilateral negotiation: the agents can find the agreed price quickly, without the price ambiguity that characterises open auction for premium inventory.

Commodity inventory, where price discovery through auction is the right mechanism and where no single publisher has a dominant share of the buyer's spend, is less suited to bilateral negotiation. Open exchange remains the right channel for this inventory.

Step three: build mandate and agent infrastructure

Running bilateral deals at scale requires mandate infrastructure on the buy side. The mandate defines what the buy-side agent is authorised to agree: the CPM ranges, the inventory scope, the audience data conditions, and the approval thresholds for deals outside the agent's autonomous authority.

The mandate needs to be written before the agent is deployed, reviewed before each major campaign, and updated when campaign requirements change. This is different from conventional programmatic campaign setup: it is a governance document, not a technical configuration. Trading desks that have not previously written mandates will need to develop this capability.

The agent infrastructure itself is typically provided by the marketplace: the buy-side agent connects to the marketplace, and the marketplace routes proposals to the relevant sell-side agents based on the mandate parameters. The buyer does not need to build the agent; they need to write the mandate that the agent operates under.

What to expect from the transition

Moving a portion of spend from open auction to bilateral channels does not produce instant fee savings. There is a transition period during which the mandate needs to be calibrated, the agent's decision log needs to be reviewed, and the deal record reconciliation process needs to be set up.

The financial benefit becomes visible over several campaign cycles as the mandate is refined and the proportion of bilateral deals increases. The governance benefit, cleaner deal records and more straightforward reconciliation, is visible from the first bilateral deals.

Buyers who have gone through this transition report that the combination of lower total technology fees and better deal record quality justifies the mandate investment, particularly for their highest-value publisher relationships. The open exchange does not disappear from their buying mix; it remains the channel for inventory that does not meet the threshold for bilateral negotiation. The bilateral channel handles the premium relationships where supply chain reduction has the highest impact.