Jeff Banker, executive vice president of Interactive Data's Real-Time Market Data and Trading Solutions division, highlights opportunities for the firm, such as offering software as a service.
1. What’s the strategy of the Real-Time Market Data and Trading Solutions Group?
Interactive Data is focusing its collective resources on the areas of greatest opportunities related to wealth management and electronic trading services. We believe there are significant opportunities to grow our hosted software as a service (SaaS) approach for wealth management, as well as an open platform MSP to enable direct access to trading and market data services.
2. As the head of the division, what are some of your short-term goals for it? Long-term?
The short term goal is to have the group work together toward achieving our objectives, which include an integrated offering that combines the capabilities of our low-latency consolidated feed, PlusFeed, with the Interactive Data 7ticks network and MSP offerings, and make it available to clients across the globe. We also plan to utilize our content management and analytics platform from our Managed Solutions team to drive product extension and innovation across the company. Some of these developments are scheduled for roll-out during 2010.
Longer term, the objectives include the use of a common technology infrastructure to deliver service components, development of front-end services on a decentralized basis for their respective market segments.
3. How is the integration of 7ticks coming along? What are some of the key synergies between both companies you’re taking advantage of?
The integration is proceeding at a rapid pace, with the expectation that we will enable clients to enter our proximity network at over 12 locations, with access to execution platforms, direct and consolidated market data streams — with a single view of latency across all components.
We also recently expanded the Interactive Data 7ticks low-latency trading network to the East Coast. This expansion can enable equities and futures traders to gain more direct access to additional key equities markets by utilizing a single service provider with advanced co-location, proximity hosting, real-time monitoring and technical support capabilities for customers.
4. The company also acquired the data tools and assets of Dow Jones’ Online Financial Solutions business. Was this also integrated into the Real-Time Market Data and Trading Solutions Group?
Yes, this business is now part of the Real-Time Market Data and Trading Solutions Group, and specifically has been integrated with our Managed Solutions group. This advances one of our goals, which is to become a global leader in the hosted SaaS market data application space.
5. Interactive Data has observed that market data volumes increased by at least 90 percent annually for four of the last five years. Where do you see volumes headed in 2010?
Recently, The Financial Information Forum (FIF) released their forecasts that volumes will continue to increase under the current market structure. However, we are observing that the exchanges are applying for sub-penny pricing, which could dramatically increase the message rates and sizes.
6. What are clients demanding from you in response to this volume increase?
We believe that clients must be offered service alternatives given escalating network costs. Interactive Data offers co-location services, conflation, and related messaging filters so that we can provide the marketplace with choices related to clients’ market data requirements.
7. How does Interactive Data differentiate itself from other market data and trading technology providers such as Bloomberg and Thomson Reuters, which just acquired Aegisoft?
There are three key differentiators that we offer the marketplace:
1. We are a global data feed provider that is broadly deployed across various market segments, with flexible licensing terms to service the evolving needs of the marketplace
2. We offer direct market access for trading and market data services via a neutral ecosystem, which enables market participants to outsource their operations, or components, to our Interactive Data 7ticks platform, with comprehensive latency transparency across the stack
3. We focus on providing market data applications on a hosted SaaS platform, enabling clients to reduce total cost of ownership and receive a better application experience versus deployed solutions — which are rarely in synch with new version capabilities.
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