Sponsored by SIX Financial Information
Different Feeds for Different Folks
Over the past 15 years, the datafeeds landscape has changed beyond recognition. Once the preserve of only the largest firms with the most demanding requirements in terms of volume and performance, with most capital markets participants relying on terminals to meet their data requirements, the efficiency and speed advantages of both consolidated and direct feeds won over users at large and small firms alike.
On the direct feed side, this was largely driven by two factors: trading firms wanting faster and direct sources of data to support evolving algorithmic trading operations, and exchanges looking for new revenues, bypassing traditional consolidators with their own direct feed infrastructures. And despite these efforts, consolidated feed use has also grown as trading operations become more globalized and firms began demanding access to markets where direct feeds are either impractical or simply don't exist.
But if speed was the driving factor for feeds, the current focus is on flexibility and performance, where "performance" covers a multitude of factors beyond just speed, including reliability, capacity management and cost. So firms must not only invest in high-performance infrastructures to handle these datafeeds, but also in sophisticated monitoring systems to measure speed, uptime and other factors─though unlike in the past, when these were used by small business units running alongside enterprise systems, high performance is now the standard. "Speed has become an expectation, not a driver," says Adam Honore, chief executive of financial technology business strategy consultancy MarketsTech LLC.
However, over the same period, attrition and mergers have meant that the once-booming market for data distribution platforms and ticker plants has shrunk significantly, with much of this infrastructure business consolidating around a de facto incumbent, and only a few smaller technology companies providing competing platforms─though usually with limited capabilities.
Increased data availability has inevitably led to commoditization, and so in addition to datafeeds, firms are now looking at analytics that can deliver additional value and insight into the raw data. And with more analytics being presented via apps to serve the needs of an increasingly mobile workforce, new delivery mechanisms, APIs and cloud data marts are a logical next step for many data consumers─though participants in this report's Q&A say these will coexist with, rather than replace, the current generation of datafeed solutions.
Bill Murphy, CTO of Blackstone, once again joins the podcast to discuss the private equity firm's new offices, designed to house its innovations team.Subscribe to Weekly Wrap emails