Microsoft To Stop Caching Prebid Video Files, Leaving Publishers With A Major Ad Serving Problem

Recorded: Jan. 26, 2026, 9 p.m.

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Microsoft To Stop Caching Prebid Video Files, Leaving Publishers With A Major Ad Serving Problem | AdExchanger

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Home Publishers Microsoft To Stop Caching Prebid Video Files, Leaving Publishers With A Major Ad Serving Problem

Publishers
Microsoft To Stop Caching Prebid Video Files, Leaving Publishers With A Major Ad Serving Problem By James Hercher

Monday, January 26th, 2026 – 12:28 pm
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Most publishers have no idea that a major part of their video ad delivery will stop working on April 30, shortly after Microsoft shuts down the Xandr DSP.
For publishers that rely on Prebid and Google Ad Manager, the effects could be immediate and costly.
When an advertiser wins a video ad impression in a Prebid auction and the publisher uses Google Ad Manager (GAM), Google runs a secondary auction that compares the Prebid bid against bids from its own demand stack.
If the Prebid bid wins, GAM calls for the video creative to be served.
This all happens in microseconds.

But for that brief moment before GAM makes the final auction decision, an intermediary must host the video ad file coming from Prebid. To date, these storage costs have always been taken care of on behalf of publishers, initially by AppNexus, then by Xandr within AT&T and, now, by Microsoft Advertising, which bought Xandr in 2021.
But, as of the end of this month, Microsoft Advertising will no longer pay to cache those Prebid video ad files as, essentially, a public service. Caching Prebid video files will now be part of Microsoft’s paid ad tech offering.
“In the last year, Prebid.js has released the capability to use local caching, which provides a better user experience and reduced network requirements, but we wanted to give the community more time to make this update to their implementation,” a spokesperson for Microsoft Advertising told AdExchanger.
Microsoft Advertising also delayed the deadline from January 31 to April 30.
This pending change to Prebid’s video ad serving is actually a big problem, despite the deadline extensions, although you wouldn’t know it from the next-to-no attention it’s received from most publishers and SSPs.
When Microsoft announced the change last August, “they probably thought they were giving everybody a lot of time,” said Patrick McCann, SVP of research at Raptive, a Prebid board member and chair of Prebid.js, the organization’s deeply in the weeds developer group that produces the open-source codebase.

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Microsoft already gave a three-month extension. “But what happens in ad tech, as is often the case, is that people wait for the absolute deadline,” McCann said.
So, what happens now?
In short, many video ads that are served via Prebid and GAM will result in a VAST error, meaning no video will appear. The auction will work and tags might indicate an ad was served, McCann said, but there will be no video file available to play.
Other Prebid video caches exist, but not for free. Some SSPs and exchanges offer storage as a paid option for clients.
Ian Meyers, director of engineering at The Trade Desk and a co-founder of Sincera, noted in a LinkedIn post last month that the Microsoft Advertising cache accounts for more than 60% of Prebid-to-GAM video ad impressions.
Around four in every five US sites that allow ad serving use GAM, per multiple estimates. So if 60% of Prebid video ad coverage in that supply chain is affected, a vast (no pun intended) number of actual ads could end up misfiring – as in, not firing – on pages come February.
And don’t expect some other company to volunteer to fill Microsoft’s shoes. McCann estimates the monthly cost of caching Prebid video ad files for GAM auctions at between $50,000 and $250,000.
But those numbers are for now.
As Prebid’s overall adoption grows and video ad products develop, caching costs will naturally rise – potentially reaching seven figures a month within a few years.
The fix
There are technical workarounds.
A bunch of SSPs and video ad networks, including Magnite, PubMatic, Mediavine and JW Player, already offer Prebid video caching as a paid option for clients. But in order for them to work, publishers need to wake up and take action.
Even if SSPs and exchanges agree to cover caching costs for their clients, each publisher in the supply chain still must make a change to its site and Prebid setup so GAM points to the correct source.
Another option – one which Prebid is exploring in its JavaScript working group – is to use what in JavaScript parlance is called a BLOB (“big local object”). The Prebid Local Cache, as the product is called, is a simpler system, according to McCann, because there’s no need for back-and-forth calls between Prebid, Microsoft and GAM.
It’s a sort of “hack” of the GAM system, McCann said. GAM doesn’t support BLOB creative units, he explained, so the Prebid Local Cache gives GAM “what it thinks is an HTTP location for the URL,” which then redirects to the BLOB.
If all this sounds wildly confusing, don’t worry. BLOB is not an acronym you’ll need to know.
And, hey, header bidding started out much the same way. Before header bidding became a standard practice across the industry, it began as a “hack” of a GAM advertising data field.
The Prebid Local Cache feature takes a similar approach, albeit in this case to get GAM to accept Prebid creatives. But because of that workaround, it doesn’t function with Google IMA, which is the multimedia ad library Google uses for most sites and apps. As a result, publishers that adopt the Prebid Local Cache could see their AdX revenue decline between 40% and 80%, as per McCann.
“We’ll continue to work with the AdX team to try to get that revenue back,” he said.
Raptive is leading development of the Prebid Local Cache, alongside early testers, including Freestar and gaming platform CrazyGames.
Cache me if you can
On the other hand, relying on a vendor to cache video files, as AppNexus and its corporate incarnations have done, has risks as well.
For example, if a user loads a webpage and doesn’t scroll right away, the cache can expire before the video is triggered, causing the ad to fail to play. Even someone scrolling too slowly down can cause video ad failure because of a caching issue. Meanwhile, despite Microsoft’s vast resources, periods of high traffic or strained capacity have occasionally bogged down the system or prevented real-time caching altogether.
Every extra call and ping between Prebid, Microsoft and GAM creates more “points of failure” that can prevent a video ad from serving, McCann said. Which is why the Prebid Local Cache and BLOB strategy is more efficient, he argued, despite the severe drop-off in AdX demand.
But the underlying issue with the Prebid Local Cache might just go away.
After all, Google could “develop first-class-citizen support for BLOBs,” McCann said, meaning local caching would work without costing publishers so much of their AdX revenue.
It is also possible that GAM integrates with Prebid at some point. It’s not a coincidence that this problem exists only within Google’s publisher ad tech. Because Google remains the main holdout from full Prebid participation, every must be hacked and reverse-engineered in order to work. Those inefficiencies have already cost the third-party ad tech industry many millions of dollars, and will cost tens of millions more in unnecessary file-hosting fees.
As the issue stands, though – and with the deadline at the end of this week – publishers that use Prebid and serve video ads have important questions to answer and a time-sensitive to-do list to tackle.
There are other companies that cover the Prebid caching fees for their clients, as Microsoft will do, too. But even that doesn’t actually solve the problem.
“Even transitioning your creatives over to point to the new vendor is a lot of work that publishers may not know how to do at the moment,” McCann said.
Many publishers first set up their Prebid servers years ago and aren’t constantly tinkering with their ad server settings.
“Making these changes, whether it’s switching to a local cache or a new caching vendor?” McCann said, “I’ve got to assume [it’s] daunting for publishers.”

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Microsoft is preparing to significantly alter the video ad serving landscape, creating a major operational challenge for publishers. The shift, slated for completion by April 30th, 2026, stems from a change in Microsoft Advertising’s strategy—no longer paying to cache Prebid video ad files. This move, initially intended to streamline their ad tech offerings, will directly impact publishers reliant on Prebid and Google Ad Manager (GAM) for video delivery.

The core of the problem lies in the historical arrangement where intermediaries, initially AppNexus and subsequently Xandr (owned by AT&T) and now Microsoft Advertising, had absorbed the costs associated with storing and serving Prebid video creatives. This caching was largely facilitated through the Prebid.js developer group, ensuring near-instant delivery of ads. However, Microsoft’s decision to self-manage this function represents a fundamental shift.

According to Patrick McCann, SVP of Research at Raptive, and a key member of the Prebid.js team, this change is already occurring. McCann explained that Microsoft Advertising will now shoulder the responsibility for hosting these files, creating a potential roadblock for publishers. The initial delay in the deadline – from January 31st to April 30th – highlights the recognition of this impending issue, albeit with a perceived lack of urgency from the wider industry.

The immediate consequences for publishers are likely to be a rise in VAST errors—instances where video ads fail to appear due to the lack of available files. While Microsoft Advertising's caching will function as part of their ad tech offering, the transition isn't seamless. Publishers using GAM will need to adapt their setups to point to Microsoft's newly managed cache.

However, the financial implications extend beyond just the cache itself. McCann estimates the monthly cost of this service to be between $50,000 and $250,000, a significant investment that publishers will need to absorb. Furthermore, this shift may amplify the need for increased investment in technologies like the Prebid Local Cache as an alternative.

The Prebid Local Cache, developed by Raptive, offers a workaround, essentially allowing GAM to ‘trick’ into thinking the video creative resides at a local URL, mitigating the reliance on Microsoft’s infrastructure. However, this workaround comes with potential drawbacks. It may lead to a decline in revenue from Google AdX (Google’s publisher demand-side platform), as GAM will need to be directed toward the local cache, rather than directly to Google’s network—potentially reducing revenue by 40-80 percent.

Several other SSPs and exchanges, including Magnite, PubMatic, Mediavine, and JW Player, already offer Prebid video caching as a paid service to their clients, offering an alternative path for publishers to avoid the Microsoft transition. However, for publishers to leverage these options, they will also need to make significant operational changes, adjusting their site settings and Prebid setups to align with the new caching system.

The problem highlighted by this shift isn’t just about the cost of caching itself. It's about increased technical complexity and the potential for disruptions within the complex Prebid ecosystem. The reliance on a centralized cache creates more “points of failure,” making it more vulnerable to disruption, and it exposes the entire supply chain to potential delays. Moreover, a number of the technological fixes, like the Prebid Local Cache, appear as “hacks” that are, in turn, dependent on other systems – namely, on GAM.

Ultimately, this situation underscores the challenges of adaptation within the rapidly evolving digital advertising landscape. It highlights a broader issue regarding the increasing reliance on complex, interconnected ecosystems and the potential disruption that can arise from shifts in their core components.