Abstract: There are around 400 advertising networks that match opportunities for “display” advertising, which include banner ads, video ads and indeed all ads other than text-based ads, on web pages and candidate advertisements. This is about a $25 billion business annually. The present study derives a method of pricing such advertisements based on their relative scarcity while insuring that all campaigns obtain a reasonably representative sample of the relevant opportunities. The mechanism is well-behaved under supply uncertainty. A method based on mechanism described in this paper is in use at Yahoo! Inc
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