EBS to Charge Clients Directly For Its Data

LONDON--EBS, a consortium-backed interbank broking service, has started charging clients directly for its EBS ticker, sources say. The data is currently distributed via Bridge, Telerate and Reuters.

In addition, sources say EBS has notified qualifying banks of the new charges, and clients will be charged a site fee, which will vary according to the size of the site. Sources tell Inside Market Data that many banks are not willing to pay for the data and will be switched off.

These clients, according to a source, include Fortis Bank in Brussels, Den Danske Bank in Denmark and New York, Bank of New York--New York and London--and Bank of Scotland in London. A spokesperson at EBS declines to make any comment.

EBS has requested that Bridge and Reuters remove these clients' access to EBS data as of Feb. 28. A Telerate spokesperson confirms that Telerate has received notification from EBS stating that certain clients will not be paying.

A spokesperson at Telerate says, "We have only just received official notification from EBS about their charges, and we are evaluating the situation." Telerate received notification from EBS almost two weeks after the charges went into effect, on Feb. 1, a source says.

One source at Bridge says that this is not a fair deal, as Bridge will carry and distribute the EBS data, turn clients on and off, but not get a share of the price as it does with other third-party optional services.

EBS could be charging for its data to level the market data playing field before launching its own market data system (IMD, Feb. 12). If clients can get its data free of charge from Bridge, Telerate or Reuters, then they may not take up EBS' new market data service.

Other EBSclients who are scheduled to be switched off at the end of the month are Brown Brothers Harriman, New York; First Union, Charlotte, N.C.; Prudential Bache, New York; and AIB, London, New York and Zurich.

EBS is currently working on Project Hazelnut (IMD, Feb. 5), the super-secret project that will take foreign exchange prices from EBS' member banks along with traded prices from its system and consolidate them into a market data service.