Revenue Mechanism for Federated Search Engines

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  • User: her aim is to search for contents/advertisement. Advertiser: its aim is to appear in sponsored links or banners displayed to targeted users.Content service provider: its aim is to produce a list of contents (organic search), given an input provided by the user. The input can be a list of keywords or a more structured query. Contents are usually extracted from databases. As in the case of Zillow, that provides contents about houses to rent and sell, and of Expedia, that gives links (e.g., flights and rooms) related to tourism. Contents can be displayed by the provider itself or by another actor.Advertising service provider: its aim is to produce a list of ads (sponsored links) that target at best the user given an input. The input can be a list of keywords or a list of contents (e.g.,web pages) and it is used to target the ads, as in the case of AdSence (i.e., Google’s advertising service provider). Ads can be displayed by another actor that uses the service.Integrated content and advertising service provider: its aim is to produce a list of contents and a list of ads. The list of ads is chosen to target at best the user. The input is a list of keywords, e.g., in the case of Google that displays organic links and sponsored links using AdWords.Content integrator: its aim is to integrate the organic search results of different content service providers. Very simple examples are meta search engines, e.g., Ecosia, that integratescontent from Yahoo! and Bing, and Ixquick that uses links from Google, Yahoo!, Exalead, Wikipedia and a lot of others.
  • Pay–per–query: a payment is required to have access to data.Pay–per–impression: a payment is required to have a link displayed.Pay–per–click: a payment is required when a given displayed link is clicked.Pay–per–conversion: a payment is required when a conversion (e.g., a transaction) is accomplished.
  • We focus our attention on Auction models.
  • General model of auction per advertising
  • is the payment rule defining the payment of advertiser a.
  • CHARACTERISTICS OF THE MOST STUDIED AUCTION IN LITERATURE- Efficient allocation: maximize the expected revenue of the auctioneerGFP: adopted by Overture in 1997GSP: currently adopted auction (by Google, Yahoo!)
  • ScenarioIN AZZURRO advertising service providersIN VERDE content service providersIN ROSSO integrated content and advertising service provider
  • Primo sottopunto: come il business model numero 1 (presentato prima)Glialtrisottopunti: come il business model 3 o 5
  • Primo sottopunto: come il business model numero 1 (presentato prima)Glialtrisottopunti: come il business model 3 o 5
  • Social choice function computes the EFFICIENT allocationTheta: set di valori e qualitàcomunicate al FSETheta –s : tutti I valori e le qualitàcomnicate al SE trannequelleriportate da service provider s
  • Social choice function computes the EFFICIENT allocationCASE1: la redistribuzione minima èquellacheva a soddisfare I vincolicontrattualitragliattori e nullapiùCASE2: calcolodellaredistribuzionepiùcomplicato, cerco di redistribuireilmassimo.
  • Social choice function computes the EFFICIENT allocationCASE1: la redistribuzione minima èquellacheva a soddisfare I vincolicontrattualitragliattori e nullapiù (indicata con t nella formula dopo)CASE2: calcolodellaredistribuzionepiùcomplicato, cerco di redistribuireilmassimo.Theta primo : unapossibilecombinazione di valori e qualitàriportate dal service provedier s
  • Social choice function computes the EFFICIENT allocationCASE1: la redistribuzione minima èquellacheva a soddisfare I vincolicontrattualitragliattori e nullapiù (indicata con t nella formula dopo)CASE2: calcolodellaredistribuzionepiùcomplicato, cerco di redistribuireilmassimo.Theta primo : unapossibilecombinazione di valori e qualitàriportate dal service provedier s
  • Revenue Mechanism for Federated Search Engines

    1. 1. Designing a Revenue Mechanismfor Federated Search Engines<br />Laura Bonetti, Sofia Ceppi, Nicola Gatti<br />Politecnico di Milano<br />Presenter:Marco Brambilla<br />marco.brambilla@polimi.it<br />marcobrambi marcobrambi<br />
    2. 2. Outline<br />Aim <br />Existing revenue mechanisms<br />Business models + microeconomic models<br />A revenue mechanisms for FSE<br />Motivation<br />Model definition<br />Requirements<br />Properties<br />
    3. 3. Federated Search Engines<br />Search paradigm<br />that integrates search results<br />from heterogeneous<br />domain-specific<br />content providers<br />
    4. 4. The Problem<br />Designing a suitable<br />revenue mechanism<br /> Business model<br />who pays and when<br /> Microeconomic model<br />how the optimal payment can be computed<br />
    5. 5. Actors<br />User<br />Advertiser<br />Content service provider<br />Advertising service provider<br />Integrated content and advertising service provider<br />Content integrator<br />
    6. 6. Payment Scheme<br />Pay-per-query<br />User / integrator pays for content <br />Pay-per-impression<br />Advertiser pays for each impression<br />Pay-per-click<br />Advertiser pays for user clicks<br />Pay-per-conversion<br />User / advertiser pays when a transaction is made<br />
    7. 7. Microeconomic Models<br />Pricing models<br />Define the best price at which a service can be sold<br />Capture static situations<br />The optimization problem is solved offline<br />Auction models<br />Define how some resources are allocated and how much players have to pay<br />Capture dynamic situations<br />The optimization problem is solved online<br />
    8. 8. Auction Model for Advertising<br />
    9. 9. Auction Model for Advertising<br />Allocation Function<br />Possible Allocation<br />Advertisers<br />Bids that ad a can submit<br />Payment<br />Rule<br />
    10. 10. Auctions Characteristics<br />Efficientallocation<br />The allocation maximizes the cumulative expected revenue<br />Pay-per-click payment scheme<br />Most known:<br />Generalized First Price<br />Generalized Second Price<br />Vickrey-Clarke-Groves (VCG)<br />
    11. 11. Business Model for Federated Search<br />Q1: date of arrival<br />Q2: date of departure<br />Q3: transfer user prefers<br />Q4: departure city<br />Q5: activity to do<br />Q6: preferred activity date <br />Q7: arrival city<br />QUERY<br />Q1 + Q2 + Q3 + Q4 + Q5 + Q6 + Q7<br />Content <br />Advertising<br />TRANSPORT<br />Content<br />service provider<br />ACTIVITY<br />Content<br />service provider<br />RESTAURANT<br />Content service provider<br />HOTEL<br />Advertising service provider<br />RESTAURANT<br />Advertising service provider<br />RESTAURANT<br />Advertising service provider<br />
    12. 12. Business Model Requirements<br />Heterogeneity<br />Integration of different business models<br />Redistribution<br />Every actor must receives an appropriate monetary incentive<br />Flexibility<br />According to the specific online search application<br />
    13. 13. Business Model Design (1)<br />Multiple business models:<br />FSE uses a content service provider to have access to data <br />  pay-per-query<br />FSE uses an advertising service provider <br /> pay per click or pay-per-conversion<br />FSE uses an integrated content and advertising service provider <br /> pay per click or pay-per-conversion<br />
    14. 14. Business Model Design (2)<br />Redistribution:<br />Payment redistributed among all the involved actors<br />The appropriate monetary incentive is defined by means of constraints in the microeconomic model<br />Flexibility:<br />We allow the change of the actors and their interactions (see microeconomic model)<br />
    15. 15. Microeconomic Model for FSE<br />For the FSE we need a novel microeconomic model<br />to capture the integration of advertisement<br />to find the appropriate redistribution<br />This model must determine:<br />the optimal payments between the FSE and all the advertising service providers<br />
    16. 16. Microeconomic Model Definition<br />Auction model with redistribution scheme<br />The bidders submit the qualities of the ads in addition to the values<br />The FSE need to have all the information about the ads to be in the position to target at best the ads for the user extracting the maximum revenue from the advertisement<br />
    17. 17. Microeconomic Model Requirements (1)<br />Individual rationality<br />Each actor expects a non-negative utility<br />Weak budget balance<br />The FSE’s revenue expected must be non-negative<br />Incentive compatibility<br />No actor gains more by misreporting its true valuation<br />
    18. 18. Microeconomic Model Requirements (1)<br />Allocative efficiency<br />The allocation maximizes the cumulative expected revenue<br />Redistribution<br />The revenue must be shared over the actors without violating the requirements<br />Flexibility<br />The model must work with potentially different constraints due to different contracts<br />
    19. 19. Microeconomic Model Design<br />The model is an extension of the VCG mechanism<br />REDISTRIBUTION<br />Two computational phases:<br />Phase 1: list of ads to display and payment without redistribution<br />Phase 2: redistribution<br />
    20. 20. Microecon. Model Design – Phase 1<br />The social choice function:<br />VCG payments:<br />
    21. 21. Microecon. Model Design – Phase 2<br />Case 1: The FSE is a private entity <br />Minimum redistribution<br />
    22. 22. MM: Model Design – Phase 2<br />Case 1: The FSE is a private entity <br />Minimum redistribution<br />Case 2: The FSE is a no-profit entity<br />
    23. 23. MM: Model Design – Phase 2<br />Case 1: The FSE is a private entity <br />Minimum redistribution<br />Case 2: The FSE is a no-profit entity<br />Priority over the actors<br />Contract<br />A possible report of service provider s<br />
    24. 24. MM: Properties<br />Pay-per-impression<br />Undominated redistribution scheme<br />It is not possible redistribute more revenue without violating the incentive compatibility property<br />Average percentage of the redistributed revenue: Experiments on Webscope A3 Yahoo! Dataset = 70%<br />Impossibility of total redistribution<br />It is not possible to redistribute all the revenue to the service providers<br />
    25. 25. Conclusion<br />FSE requires a new revenue mechanism<br />Heterogeneous and flexible revenue mechanism for FSE that:<br />Satisfies some desirable properties<br />Allows for redistribution of FSE’s surplus<br />Future work<br />Complete evaluation <br />Merging of ads belonging to different lists <br />Relations between organic and advertized links for FSE<br />
    26. 26. Designing a Revenue Mechanism for Federated Search Engines<br />Laura Bonetti, Sofia Ceppi, Nicola Gatti<br />Politecnico di Milano<br />Questions?<br />

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