Will media become a commodity? Google and the search marketing industry that grew up around it think so. Creators of Web 2.0 content applications like Digg and Reddit think so. Today, we learn that eBay also thinks so — MediaPost reports that they pitched an electronic trading system for buying and selling media. And who solicited that pitch? None other than the Association of National Advertisers — so Big Advertisers think media is a commodity, too!

Google was the first to figure out how advertising can be a science rather than alchemy — contextual placement and pay-per-click bidding brought seamless efficiency and rigorous accountability to a process that has traditionally been one part flawed data (Nielsen, etc.), one part relationships (media seller corting media buyer), and three parts guess work (Wanamaker’s “half of my advertising is wasted but I don’t know which half”).

ANA’s stated rationale for seeking an “eBiz” solution for media buying is greater efficiency and transparency:

But while the eBiz efforts are designed to weed out the time-consuming and labor-intensive steps involved in Madison Avenue’s current paper-based buying systems, the initiative being championed by Roehm–soon to be senior vice president of marketing communications at retail giant Wal-mart–goes a step further, seeking to create a so-called open market structure, in which all of the information between buyers and sellers is transparent.

The problem with a stock-trading model for media buying is that it assumes there is a reliable, standardized data set, like corporate financial reporting, on which the market can make rational decisions (which isn’t to say corporate accounting is always reliable or that Wall Street is always rational!). Before Google, media buying was based on syndicated audience measurement, e.g. Nielsen — where the accuracy of the data has always been suspect — and on more qualitative (subjective) measures, e.g. the audience’s relationship with the show or magazine, how “hot” the property is, whether the context fits the brand (why you won’t see Mercedes in People), and the pseudo-science of reach and frequency.

Google’s AdWords demonstrated that contextuality can trump all these traditional measures. There’s no reason why smaller, transactional companies who are less concerned about brand shouldn’t view media as a commodity and take a media-agnostic approach to advertising.

But Google soon found that this doesn’t work with the big brand advertisers. When you’ve worked hard to build a brand, you don’t want it showing up in a bad context, because that badness has a tendency to rub off. That’s why they adapted the AdWords program to give advertisers control over where their ads appear and the ability to buy by impressions rather than clicks — which effectively concedes that pure technology-driven market efficiency may not be achievable in advertising. Google has also had a rough time with their print advertising program, because buying print media has always been much more about storytelling than efficiency.

So can eBay (or someone) build a truly efficient electronic marketplace for media, which could further open up the game to content creators of every size and shape (i.e. bloggers and the like)? Only if the Big Advertisers are willing to play, and that will only happen if there is some industry standard for evaluating the options, i.e. which stock should I invest in? Brand-building advertisers with long purchase horizons (e.g. luxury cars) can’t buy based on clicks, so the Google model isn’t going to work for the whole market.

What technology companies don’t understand about advertising and media is that audience matters — that’s what advertisers are buying. And context matters, especially when it comes to brands. Whoever can come up with an efficient way to factor reliable measurements for audience and context into an electronic marketplace for media buying will have the next AdWords (and all the cash that goes with it).

(And for everyone who wants to see Citizen Journalism projects like Bayosphere be commercially viable — focus on the media commodity conundrum. If there’s going to be journalism, citizen or otherwise, somebody’s got to pay for it.)