Article By:Sean Weinberg (Sean@aclion.com)

Source Article Found In New York Times:
Leftover Ad Space? Exchanges Handle the Remnants

I read an interesting article in the NYTimes today....

Joe Zawadzki’s traders spend their days in front of two computer screens, feeding their systems with data and trying to perfect their trading algorithms.

But they are not analyzing stocks. They are analyzing advertising.

What they are measuring is activity on advertising exchanges, where companies bid to place their online ads on space provided by publishers. As advertising exchanges gain popularity -- Yahoo, Google and Microsoft have all moved into this arena recently -- Madison Avenue is borrowing tactics from Wall Street. [...]For now, Mr. Zawadzki is using the exchanges to buy and sell ads instantaneously as opportunities arise — a spot market, in Wall Street lingo — but he is working on more complex trading strategies.

Of course they’re only about a year late on these developments; but the article does a nice job of explaining the exchange space, and more significantly, pointing out the future of internet advertising, namely Media Trading. Conceptually there’s no reason this won’t work. But, media trading will require a loosening of control that publishers have historically been loath to part with. And the exchanges are time consuming and still bulky. It's noteworthy to point out...

In 2007, exchanges sold about 15 percent of the remnant inventory, and about 5 percent of online display advertising overall, according to ThinkPanmure, a research and financial services company. Most of the other 85 percent was sold through networks.

For 2008-2009, we’ll see how this plays out….