• by Erik Sass  @eriksass1, October 5, 2006

As the U.S. media industry experiments with an online platform for buying and selling media, a Chinese company, Sun New Media, has already launched a similar system, called TradEx, to facilitate media transactions.

The fee-based system, open only to members, allows users to trade a wide variety of media, ranging from TV spots to newspaper ad space. In addition to membership fees, Sun will also take a small commission from each online sale. Since the launch of the system in the second quarter, over 500 media buyers and advertisers have signed up for the exchange--a promising start.

In fairness to American companies, the new clearinghouse received a big boost from its partnership with the Chinese government. From previous work, the company already enjoyed relationships with China's media networks, local and provincial TV stations, cable stations and publishing associations. It also negotiated exclusive partnerships with China's key government regulatory agencies, including the China Periodical Management Center, which oversees all print media transactions.

A large part of China's faster pace is due, ironically, to the streamlining effect of an authoritarian system. Corruption is rampant and many needed reforms are falling by the wayside, but if the government takes an interest in a project, it fast-forwards the process. Although China is still nominally communist, the technocrats who run China are intensely interested in information technology and e-commerce to bolster Chinese competitiveness in the international economy.

TradEx's rapid progress contrasts somewhat with more leisurely efforts to set up an online exchange, called Adsdaq, by the American media industry. At the behest of leading advertisers--including Julie Roehm, Wal-Mart's senior vice president for marketing communications--eBay pitched the concept to the Association of National Advertisers' Television Advertising Committee in January, and presented the idea again in a more public form during the ANA's Financial Management Committee meeting in Naples, Florida, in May.

The Adsdaq initiative looks fairly substantive: The task force has floated a $50 million budget for the test phase. But the idea is not without controversy. Some of the largest national advertisers are opposed to the idea. Also, it's still being vetted through the ANA, which is conducting additional surveys of its membership to gauge support. A formal steering committee has yet to be organized.