FISD Welcomes NYSE GDLA Consultation

Members of industry association FISD’s Consumer Constituency Group have welcomed efforts by NYSE Euronext to consult end-user firms over its upcoming Global Data License Agreement, which will introduce new policy for usage reporting, unit of count, and how it charges for use of derived data and data in non-display applications (IMD, July 9).

NYSE Euronext first approached the CCG last month to communicate its proposals to members among banks, brokerages, investment firms and hedge funds, who were then given the opportunity to respond to the proposals and put questions directly to the exchange, says CCG co-chair Tristan Dehaan.

“Not only has NYSE spoken to the CCG and its members, but it has also given us a period of consultation—an extended period to shape and reshape the policy to make sure everyone is happy,” before the policy is finalized later this year and rolled out in 2013, Dehaan says

In recent months, exchanges and vendors—such as Nasdaq and S&P Indices (IMD, March 12; July 2)—have come under fire from data consumer groups for introducing policy changes too quickly. In contrast, Dehaan says NYSE’s move to engage customers in developing the new policy over a year-long time period is valuable not just to the exchange in terms of receiving feedback, but also to end-users, who typically make a one-year plan of data projects and spend, whereas data providers typically provide only 90 days’ notice—at best—of new policies and fees.

“Exchanges and vendors don’t think these [changes] up on the spur of the moment,” Dehaan says. “We’ve always said in the past, ‘Tell us at the time of development, then we can work together.’ That way, the customer feels listened to and valued, and he also has time to inform the business internally and make the necessary changes” in preparation for new requirements.

Dehaan says the CCG’s decision to present the London Stock Exchange with a Best of the Best in Excellence (“Bobbie”) award at the FISD Europe Conference in Paris in March, in recognition of the clarity of its commercial policies, played a role in encouraging NYSE to engage with customers.

“The Bobie award is purely about the fact that the LSE went to do something that had impact for the client, and they recognized this by engaging and giving end-users time to reconstruct budgets and time to implement. Mike Hodgson, [head of licensing for global market data at NYSE Euronext] saw this and understood that if a vendor is going to change something, it can either go ahead and do what it wants, or can try to do it the more sensible way and work together and create something which the customer is satisfied with,” Dehaan adds.

Looking forward, he says the CCG is hopeful that similar levels of customer engagement will be a new trend for vendors and exchanges seeking to implement fee or policy changes, and is encouraging NYSE Euronext to share its experiences with other data sources among vendors and exchanges, to alleviate fears that consulting with customers will only lead to confrontation over fee increases.