James Needham, who died Friday at 80, was the first paid chairman of the New York Stock Exchange and marked the beginning of the institution’s transition to a competitive marketplace from a sleepy club for traders.

Yet his term in office, between 1972 and 1976, was in many ways an act of futility, as his campaigns to stop the exchange from negotiating its brokerage fees and to prevent trading listed issues outside the exchange both collapsed and a more open and vibrant market emerged.

“He was on the wrong side of history,” a law professor at Columbia University, John Coffee Jr., said yesterday. “The fixed rates had been in place since the days when the exchange was beneath the buttonwood tree.”

Needham, an accountant whom President Nixon appointed in 1969 to a seat on the Securities and Exchange Commission, came to Wall Street with a reputation as an independent voice critical of the venerable system in which seat holders received a fixed fee for executing trades on behalf of clients. High fees tended to keep small investors out of the market and supported a culture in which some brokers agreed to fee-splitting and other cartellike behavior. Congress was already beginning to look into fixed fees, and in the spring of 1972, the SEC reduced the threshold above which brokerage rates could be negotiated to $300,000.

“They went to him because they wanted a Washington-savvy person,” Mr. Coffee said.

Taking over at the NYSE during a sustained recession, Needham came out against abolishing fixed brokerage fees until conditions improved. He later tried offering a deal by which the Big Board would drop fixed fees in exchange for a legal prohibition on nonexchange trading of listed shares, but Congress seemed deaf to his entreaties.

In 1975 testimony before the SEC, Needham challenged the body to meet him “on the courthouse steps” over the issue, but in the event the NYSE declined to sue.

” We got caught with our fly open,” a partner in a specialist firm told the Wall Street Journal.

Having lost on both of his signature rear-guard issues, fees and outside exchange bans, Needham’s raison d’être at the NYSE ceased to exist. In May 1976, less than four years into his six-year, $200,000 annual contract, he resigned under rumored board pressure.

“It was one of the rare times when the insiders were wrong about what was in their own longterm interest,” Mr. Coffee said, and added that within a few years Wall Street firms had the opposite problem of the ones Needham predicted: They were hampered by an inability to deal with the overwhelming volume generated by low fees. Some firms even went out of business because of the chaos, Mr. Coffee said.

Needham was raised in Queens and served in the Navy during World War II. After attending Cornell University and St. John’s University, he joined the accounting firm Price Waterhouse in 1951. In 1957, he moved to A.M. Pullen & Co., where he became the partner in charge of the New York office before being named to a four-year term at the SEC.

The appointment aroused interest at the time because he was neither a lawyer nor a prominent Republican — his highest position in the party had been as treasurer of the Plainview, Long Island, Republican Club. But he did receive a high recommendation from an influential professional association, the American Institute of Certified Public Accountants.

At the NYSE, Needham moved to extend trading hours to 4 p.m. from 3:30 and established that the exchange would be closed on all federal holidays. He also was credited with helping introduce new computer systems.

After leaving the NYSE, he worked in a variety of consulting positions and also represented America as an ambassador to the Exhibition of the International Exposition in Japan between 1982 and 1986. In 1990, he briefly campaigned for a seat in the House of Representatives. He also served on the Southampton Town Council and sat on the board of the Long Island Lighting Co. and other public companies.

In 2003, when it became public that the NYSE had paid its president, Richard Grasso, $140 million in compensation, Needham’s was among the loudest voices demanding Mr. Grasso’s — and the entire NYSE board of directors’ — resignation. “It’s time to clean house,” he told the Associated Press.

James Joseph Needham

Born August 18, 1926, in Woodhaven, Queens; died April 6 at his home in Southampton, N.Y., of myelosdysplastic syndrome, a bone marrow disorder; survived by his wife, Patricia Henry Campo; three sons, James Needham, Robert Needham, and Michael Needham; two daughters, Ravenna Taylor and Catherine Needham; two grandchildren; a brother, John Needham, and a sister, Sandra Reda. His first wife, Dolores Habick, died in 1993.