• About
    • Site Profile
    • Pam Agnew, ABC (editor)
    • Dominic Jones (editor)
  • Contacts
IR Web Report
  • Latest Posts
  • Categories
    • Web Disclosure
    • Annual Reports
    • Quarterly Reporting
    • Presentations
    • Social Media
    • IR Law
    • Governance
    • Shareholder Services
    • Video
    • Mobile
  • Book Store
  • Jobs
Browse: Home / Most US investors get PR wire releases 80 seconds after Wall Street


Most US investors get PR wire releases 80 seconds after Wall Street

By Dominic Jones on August 3, 2010

  • Tweet

A SIMPLE analysis of 100 company news releases shows that the average delay between when PR wire services release the information to Wall Street and when most non-professional investors actually have access to it on Yahoo! Finance is just over 83 seconds.

A difference in access of that magnitude is unacceptable in today’s market where company news is routinely the subject of heavy trading in the pre- and after-hours markets. It’s especially galling because companies and regulators have free or low-cost ways to easily close the access gap between Wall Street and mainstream investors.

Growing public awareness of the uneven nature of company news dissemination is likely to undermine investor confidence in the fairness of the markets and  diminish their willingness to invest. No one wants to participate in a market where some get earlier access to information than others.

Real-time web increases public awareness

That there are latencies in the PR wire dissemination system is nothing new. It is inherent in the Internet protocols and computer systems that most PR wires rely on to distribute and publish company news on a myriad different websites. Many factors can affect the time it takes for information to travel over the web, including network congestion, the size of the releases, and the speed at which the receiving systems process and publish the information.

While PR wire services like Business Wire boast about their patented simultaneous distribution technologies, the fact is they cannot guarantee that an investor waiting for a company earnings release on a public investment website will be able to access it at the same time as a professional trader looking at a Bloomberg terminal. It depends on the factors listed above, and in Business Wire’s case, on the recipient system having special software installed to decipher pre-delivered encrypted releases.

However, these inherent latencies have become much more noticeable and relevant to the investing public in the two years since websites like Google Finance and others started publishing real-time stock prices. Prior to that, prices were typically delayed by 15 minutes, so investors on public websites were less aware of Wall Street traders reacting to news that they themselves had not yet seen.

Awareness of uneven news dissemination has also grown with the advent of real-time information sharing services like StockTwits, where traders with access to professional terminals routinely post company news before the PR wire releases make it to popular investment websites.

Quantifying the latency of PR wire distribution

Trying to quantify the delay between when PR wires release company news and when it actually is published on public finance websites has been difficult and imprecise. This is because investment websites show the PR wire service time stamp on the releases they publish, even though the time shown is earlier than when the news actually appears on the public website.

Yahoo! Finance logoHowever, I recently discovered that Yahoo! Finance offers an earnings news feed that shows both the PR wire services’ time stamps and when the news is actually published in the feed. Yahoo! Finance is by far the biggest investor site on the web with an audience of 26.25 million unique visitors, by one recent estimate. Its users include most retail investors and also many financial professionals who use it alongside their professional services or from home.

By comparing the PR wire services’ time stamps to Yahoo! Finance’s own time stamps one is able to easily calculate the latency (see screenshot below). I did this for 100 news releases over a period of several days and at random times to get a fairer picture of the delays.

I chose random times and days to avoid potentially skewing the results, assuming that it takes longer for Yahoo! to process releases during busy periods, such as between 4:00pm and 5:00pm ET when many companies are issuing releases.

I also checked both full earnings releases, which are typically more than 1,000 words, and shorter advisories about upcoming earnings announcements. I did this because large files probably take longer to be processed than shorter ones.

Finally, I didn’t focus on any particular PR wire service, but took whatever was moving over the PR wires at the time. In the end, the results included releases from PR Newswire, Business Wire, Globe Newswire, Marketwire and CNW.

As I’ve already said, the average delay was 83 seconds. The fastest was 24 seconds and the slowest was 237 seconds or almost 4 minutes. The median was 80 seconds.

I didn’t calculate which PR wire was fastest or which was slowest because that wouldn’t be fair given that some PR wires were underrepresented in the list.

However, latencies were all over the map for all of the PR wires. For example, the speeds for Business Wire releases ranged from 24 seconds (the best) to 130 seconds, which was the 10th slowest. If anyone wants the results, I’ve posted a summary in a published Google Spreadsheet.

You can do your own research using the source code of the same feed I used. You have to look at the feed source, which you access in different ways depending on your browser, but right clicking on the screen should give you an option to see the source code.

These findings have important implications for companies and regulators. I’ll explore some of the issues in an upcoming post. In the meantime, let me know what your experiences are.


Dominic Jones

Dominic Jones (bio) created IR Web Report in 2001. He is a consultant to leading public companies and investor relations service providers worldwide. You can contact him via the contacts page.

Posted in Disclosure, Issues, Online IR | Tagged business, latency, pr wires, Quarterly Reporting, regulation fd, securities and exchange commission

« Previous Next »

Search the Site

Latest Stories

  • Survey finds social media gap between investors, companies
  • SEC’s social media guidance has devil in details
  • Crisis investor relations in the age of social media
  • Private meetings undermine fair disclosure, study finds
  • What makes a good annual report?
  • CEO pushes Reg FD limits on Twitter
  • For IROs, XBRL errors a wake-up call

Get Our Free Email Newsletter

Close
Note: We don't sell or rent our email list. Unsubscribe instructions come with each email.
Investor relations jobs by IR Web Report

Full Disclosure

All articles on IR Web Report are unpaid editorial. We do not charge a fee to outside contributors. Sponsors or advertisers are not automatically entitled to become contributors or receive editorial coverage. We accept contributors based on their individual expertise and experience. Contributors are required to disclose when they write about or refer to any company with which they have a business relationship, either directly or indirectly. If you believe that any contributor or IR Web Report is not living up this policy, please contact us or leave a comment on the relevant post. Editorial integrity is important to us and we take all complaints seriously.

Site Map

  • Home
  • Terms of Use
  • IR Web Report’s Book Store
  • IR News
  • About
  • Contacts

Archives

  • 2013
  • 2011
  • 2010
  • 2009
  • 2008
  • 2007
  • 2006
  • 2005
  • 2004
  • 2003
  • 2002
  • 2001

About IR Web Report

Founded in 2001, we are the world's leading source of information about online investor relations communications. Our core philosophy is that investors' needs must come first or companies' online communications efforts will fail to be effective. More about us

Follow @irwebreport
Feed Subscribe to feed

Copyright © 2001 - 2013 IR Web Reporting International Inc. By using this site you agree to the Terms of Use and our Privacy Policy.