Those with short-term information are the ones who benefit most by increases in the time taken to disseminate information. Let's say some fund's AI parses and interprets a favorable article 25 ms before anyone else. They start simultaneously buying stocks in NYC while writing puts and buying calls in Chicago.

Moisture in NJ slows down news from Chicago to NYC by 2 ms.

Automatic market making algorithms in NYC, in the absence of evidence from the options markets, bet on mean reversion and don't adjust their bids and asks as quickly as they would had information arrived from Chicago.

In those 2 ms, two investors each sell 100 shares a penny cheaper than they would have otherwise to the institutional investor with the news-reading AI.

A retired teacher and traditional hedge fund manager are each $1 poorer and someone writing a newsreading bot is $2 richer than they would have been had NJ been drier.

The individual stories are pretty boring, but millions of times a day, a small short-term information edge is slightly more valuable. Sure, 99% of the time both the winners and the losers are institutional investors. However, if you just look at a retail investor (or some institutional investor representing mostly retail investors), they're almost never on the side with a short-term informational advantage.

On the one hand, it's 99% just institutions winning and institutions losing. But, when you zoom in on those 1% of cases where an unwitting retail investor got lucky or got unlucky, there's a bias in their luck due to their lack of valuable short-term information.

On the other hand, those 2 ms might also mean that if a big retirement fund is unloading $10 million in stock to a bank, that bank has an extra 2 ms to simultaneously start selling the stock and get short in the options market before the low-latency market makers adjust prices. Maybe this means the bank is willing to bid $2 higher for the retirement fund's block trade.

In any case, the actions of the HFTs have both positive and negative knock-on effects for ordinary retail investors, even if other HFTs account for the vast majority of the HFTs' profit margins. Sometimes the short-term information comes from the outside world, and sometimes it comes from institutional investors trying not to telegraph their moves on behalf of retail investors.