Dr. Joe Recommends: Digital Advertising Contracts Traded on NASDAQ?
By Dr. Joe Webb
Published: March 30, 2017
Yes, that headline is correct as explained in a recent article. It’s the New York Interactive Advertising Exchange. Its founders were interviewed recently and explained the business. In a nutshell, and in my words: advertising is the delivery of audience access at a particular time and place and circumstance, in a specified format, which make contracts for those attributes sellable and tradeable in an open market.
In one article, an interviewee makes a mistake claiming that this trades contracts like stocks because are commodities. Not so fast. Commodities are commodities, not stocks, and commodity contracts are legal obligations to deliver a commodity or service at a time or place. Stocks have no obligation to perform at all; they are just a share of ownership.
It will never happen, but these kinds of contracts would be good for the USPS. They would fight this, of course, but this would be good for all involved. We could finally learn the market price of postage! (We’ve never known what that is because prices are imposed; and you don’t want me writing about Lysander Spooner again, do you?) and USPS could get premiums for heavy mailing periods by identifying delivery constraints for certain days and time periods. Slow periods or slack times would be sold at lower prices. Specific delivery times could be sold at premium prices. Heavy buyers could lock in prices at market rates, not by preferred rates from lobbying the PRC. This would be fairer to smaller users. Prices would be set by market conditions and demand, not by costs. Workloads could be balanced by these contracts. Even geographic deliveries may differ in price based on any number of factors.
This will never happen with postal prices, but the New York Interactive Advertising Exchange will be an experiment worth watching.