The 1% That Hurts: Amazon’s Assault on Ad Tech’s Middlemen

When Jeff Bezos shows up at your rooftop party with a wrecking ball, those TTD take rates suddenly look like a vintage Myspace strategy.

Pesach Lattin (ADOTAT)
June 09, 2025

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“Oh Look, The Walled Garden Has a Bulldozer Now”

Amazon Crashes The Trade Desk’s Party

There’s a cold wind blowing through Ventura, California, and it’s not from the Pacific. It’s the sound of Amazon’s DSP crashing The Trade Desk’s long-running rooftop party—and not politely ringing the bell, but kicking in the door wearing Prime-branded steel-toe boots.

Let’s not sugarcoat this: Amazon isn’t just playing in the sandbox anymore. It’s replacing the sandbox with a stadium, charging 1% admission, and handing out free hot dogs. And yes, insiders say The Trade Desk is nervous—very nervous. According to multiple ad execs whispering louder than they should, the mood at TTD has shifted from “we’ve got this” to “please tell me that $80 million shift to Amazon was a typo.”

Because here’s the thing: it wasn’t.

🚛 Amazon is here, and it brought receipts. Big ones. $80 million from one global auto brand. Tens of millions more from PMG’s client list. All redirected straight from The Trade Desk’s pocket into Amazon’s omnichannel embrace. Suddenly, being the Switzerland of programmatic isn’t as sexy as it used to be—not when the other guy’s offering cut-rate media and exclusive inventory wrapped in two-day shipping.

Meanwhile, Jeff Green is still publicly smiling, still insisting that independence is the future, still pointing to percentage growth numbers like they’re holy writ. But behind the scenes? You don’t start emergency Zoom calls with phrases like “Amazon problem” unless, well, you’ve got one.

📉 And Wall Street noticed. TTD’s stock dipped like a CTV impression graph at 3am. Amazon’s? Barely a blink. Because when you’re Amazon, ad margins are a rounding error and the DSP is just another weapon in your vertically integrated arsenal. Prime Video, Twitch, Fire TV, retail data, AWS discounts—they’re all part of the same tentacled monster smiling and waving at the open web while eating it alive.

Let’s pause here and appreciate the irony: The Trade Desk has spent years railing against the walled gardens of Google and Facebook—only to be ambushed by another garden that looks more like Versailles with a rocket launcher.

🧠 This isn’t a platform war. It’s a worldview collision.

TTD’s whole thesis? Neutrality, transparency, and the open internet.
Amazon’s? “Cool story, here’s Thursday Night Football and a 0% fee on O&O.”

What’s happening isn’t subtle. It’s a power move wrapped in a spreadsheet: Amazon’s pricing is weaponized, its data is hoarded, and its charm offensive is hitting agency inboxes like a flood warning. And it’s working.

So what now?

In this five-part series, we’re peeling back the curtain on the most consequential battle in ad tech right now—Amazon vs. The Trade Desk—and why the next twelve months could redefine the economics, alliances, and soul of programmatic.

In Part 2, we’ll examine how Amazon’s 1% pricing isn’t just a flex—it’s a business model that could rip the floor out from under every independent DSP still charging legacy fees.
In Part 3 (ADOTAT+ subscribers only), we’ll pit Amazon and TTD head-to-head on data, tech, and talent. Spoiler: one has the NFL, the other has UID2.
Part 4 brings us to the battlefield: agencies, brands, publishers, and Wall Street reactions—because nothing motivates like panic.
And Part 5 is the survival guide: how The Trade Desk (and any indie DSP with a prayer) can fight back without just slashing prices and praying Jeff Bezos gets bored.

Stay bold, stay curious—and watch your take rate.
Because this time, the disruptor just got disrupted.
And Amazon didn’t even blink.

Discount Domination – Inside Amazon’s 1% Fee Strategy
Amazon’s DSP isn’t just cheaper. It’s a margin-erasing, spreadsheet-breaking provocation.

Amazon has made a career out of selling things cheaper and faster than anyone else. Now it’s bringing that same brutal efficiency to programmatic advertising—armed with pricing that has rival DSPs sweating through their Patagonia vests.

At the center of the disruption: a 1% tech fee for programmatic guaranteed (PG) deals. In some cases, 0% for ads on Amazon’s own properties. For context, most demand-side platforms operate with a 10–20% take rate, with The Trade Desk’s famously hovering around 20%. Amazon’s move isn’t a discount. It’s a declaration of war.

💸 A Race to Zero – And Amazon’s Already There

Amazon’s strategy is textbook predatory pricing, but with a modern twist: they don’t need to make money on the DSP. The company can treat it as a loss leader—because the real value isn’t in the fee, it’s in keeping advertisers inside its walls. Once inside, they can be monetized six ways from Sunday: sponsored listings, AWS analytics, AMC usage fees, and—of course—the incremental lift in product sales from well-placed ads.

It’s not unlike watching Costco offer $1.50 hot dog combos in 2025: not profitable on their own, but incredibly effective at pulling people in. The difference is that Amazon’s “hot dog” is a scaled media engine with NFL inventory and retail data that every CPG marketer in America would sell their first-party cookies to access.

So yes, Amazon can afford to charge less. The question is whether anyone else can afford to ignore it.

🧮 The Math No CFO Can Ignore

For advertisers, this is more than a flashy headline. It’s real budget pressure. At a 1% fee, an agency buying $10 million in media through Amazon saves as much as $1.5–$2 million compared to the same buy through a platform charging 15–20%. That’s not theoretical; that’s the kind of delta that gets line items moved, especially when procurement teams are circling like hawks.

As one exec put it, “Telling a brand CMO you’re saving them 10% in fees with no apparent performance hit? That’s a career-making slide.” And if that wasn’t enough, Amazon is sweetening the pot: bonus impressions, AWS perks, flexible billing. It’s not just cheaper—it’s easier.

This has already triggered large-scale budget shifts. Multiple agencies report clients reallocating significant CTV and display dollars away from The Trade Desk and toward Amazon’s platform. And while TTD’s public posture remains confident, it’s clear the math is changing faster than its messaging.

🧠 The Cost of “Cheap”

Of course, there’s a counter-narrative—and The Trade Desk is pushing it hard.

Jeff Green, never one to flinch publicly, has made it clear that the company has no intention of slashing fees to compete with Amazon on price alone. TTD’s defense is rooted in differentiation: it’s a neutral, objective platform with sophisticated bidding, robust optimization, and reach across the entire open web. It doesn’t own media. It doesn’t steer spend toward its own content. It doesn’t trap you inside a walled garden.

The subtext? Amazon’s “free lunch” comes with a side of surveillance capitalism.

And they’re not wrong—there are trade-offs to buying through Amazon. Advertisers may find themselves inside a black box, reliant on Amazon’s measurement and attribution tools, with little visibility into how campaigns actually perform across third-party sites. Some brand marketers, particularly in categories like retail and grocery, are wary of handing over even more data to a competitor that already controls product search and shelf space.

But it’s a tough sell to say “we’re more expensive, but principled” in a market where every dollar is under scrutiny.

🏭 The Economics of Disruption

The bigger story here isn’t just about Amazon vs. The Trade Desk. It’s about the economic model of DSPs and how quickly it’s being unraveled.

For years, DSPs were able to justify high fees based on complexity—data ingestion, algorithmic optimization, integrations, support. But PG deals, the fastest-growing segment in CTV and video, are often straightforward pipes: one buyer, one seller, no auction logic. The technology doesn’t need to be expensive. And now Amazon’s pricing is making that obvious.

Independent DSPs are being forced to answer a hard question: what are we charging for, and is it still worth it? Some will drop fees to stay competitive. Others will double down on performance and platform features to justify their price. A few may shift toward subscription or service models, unbundling fees from media altogether.

What’s clear is that Amazon has cracked open a long-avoided industry conversation—and once advertisers see what’s behind the curtain, they’re unlikely to forget it.

🧨 The Takeaway

Amazon’s 1% fee strategy is more than a marketing play. It’s a direct attack on the economic foundation of independent ad tech—and a remarkably effective one. While The Trade Desk continues to argue that premium platforms deserve premium pricing, the market is signaling it wants options. Cheaper ones. Transparent ones. Options that don’t come wrapped in 20% margins and PowerPoint slides about “objectivity.”

For now, TTD is holding the line. But the line is moving. Fast.

🚨 What You’re Missing in ADOTAT+
“It’s Not a War for Ad Dollars—It’s a Knife Fight in a Server Room”

Let’s be blunt: If you’re reading just the free stuff, you’re getting the trailer, not the movie. The real showdown between Amazon and The Trade Desk isn’t just about CPMs or polished earnings decks—it’s about who owns the future of advertising infrastructure.

Here’s what you’re not seeing unless you’re on the inside:

🧠 A forensic breakdown of Amazon’s first-party data advantage—how they know what you binge, what you buy, and whether you floss after.

📊 The truth about Kokai and Koa—The Trade Desk’s algorithmic brain trust and why “over-engineered for the open web” is both a flex and a liability.

💼 Hiring wars and talent stacks—While Amazon throws bodies (and AWS credits) at agencies, TTD is cutting fat and hoping engineers out-code brute force.

🌍 Ideological warfare—Amazon wants you in its lovely walled garden, complete with NFL streams and machine-learned recommendations. The Trade Desk wants to be Switzerland, but it’s feeling more like a well-meaning Amsterdam start-up in a world of data superpowers.

🔍 And the table. Oh, the table. Side-by-side stats so sharp they could slice through a bundled attribution model.

You want to know who wins this fight? You want to know where the smart money is going? Then don’t just lurk—subscribe. Because while other folks are out here reading LinkedIn hot takes and quoting Q1 revenue growth like it’s gospel, ADOTAT+ is pulling the receipts.

👉 Join now. Read what the C-suites are quietly screenshotting.
Stay bold. Stay curious. And know more than you did yesterday.

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The 1% That Hurts: Amazon’s Assault on Ad Tech’s Middlemen

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