If you have been in the app monetization space for any amount of time, you have heard the terms "Open Bidding" and "header bidding" used almost interchangeably. They share the same goal — creating real-time competition among demand sources to drive up eCPMs — but they work differently under the hood. Understanding these differences is key to choosing the right approach for your app.
What Is Header Bidding?
Header bidding originated in web advertising, where publishers added JavaScript code to the "header" of their web pages to simultaneously request bids from multiple demand partners before making an ad call to their primary ad server. The highest bid won, creating true competition and eliminating the sequential waterfall problem where demand sources are called one at a time.
In the mobile app context, header bidding works through client-side SDKs. Each participating demand partner has an SDK integrated into your app. When an ad opportunity arises, all SDKs are called simultaneously, each returns a bid, and the highest bid wins. AppLovin MAX and Unity LevelPlay both support this model through their in-app bidding features.
What Is Open Bidding?
Open Bidding (formerly Exchange Bidding) is Google's server-side alternative. Instead of running auctions on the user's device through multiple SDKs, Open Bidding runs the auction on Google's servers. Demand partners connect to Google's infrastructure and submit bids server-to-server, eliminating the need for individual SDK integrations on the client side.
Open Bidding is available through Google Ad Manager and provides access to Google's extensive demand ecosystem plus third-party exchanges that have opted into the program.
Key Differences
Latency
This is the most significant practical difference. Client-side header bidding requires each SDK to make a network call, process the auction, and return a bid — all on the user's device. More SDKs means more processing time. Open Bidding runs server-to-server, which is typically faster and does not consume device resources. For apps where ad load speed directly impacts user experience, this matters.
SDK Complexity
Every header bidding partner requires an SDK integration in your app. More SDKs mean a larger app binary, more potential for SDK conflicts, and more maintenance overhead when SDKs need updating. Open Bidding requires only the Google Mobile Ads SDK, with demand partners connecting on the server side. This significantly reduces technical complexity.
Demand Diversity
Header bidding through platforms like AppLovin MAX gives you access to a wide range of ad networks, each with their own advertiser relationships and demand. Open Bidding gives you access to Google's demand plus participating exchanges, but the pool of participating partners is smaller than what is available through client-side bidding. The optimal approach often involves both.
Transparency
Client-side header bidding gives you full visibility into each partner's bid in real-time. You can see exactly what each network bid, who won, and why. Open Bidding provides reporting through GAM, but the auction happens on Google's servers, giving you slightly less granular real-time visibility into the bidding process.
Which Should You Choose?
The honest answer: most successful publishers use both. Here is a practical framework:
Use Open Bidding through GAM as your primary auction mechanism. It provides strong demand with minimal SDK overhead and fast ad loading. Then supplement with client-side bidding from two to three top-performing networks through your mediation platform (AppLovin MAX or Unity LevelPlay) to ensure maximum demand diversity.
The publishers generating the highest ad revenue are not choosing between Open Bidding and header bidding — they are combining both in a hybrid approach that maximizes competition while keeping technical complexity manageable.
The Hybrid Approach in Practice
In a typical hybrid setup, your waterfall looks like this: Open Bidding through GAM competes alongside two or three in-app bidding networks. Below that, you have traditional waterfall entries for networks that do not support real-time bidding. A managed demand partner can sit at any level of this stack, providing additional competition that benefits your overall yield regardless of which auction mechanism is being used.
The key is not to over-complicate it. Start with Open Bidding through GAM, add your mediation platform's top bidding partners, and work with a managed partner to fill in the gaps. Then optimize based on what the data tells you.