[ I N D E P T H | C O N S O L I D A T E D T A P E ]
data contributor , a costly and time-consuming process .
The new proposal is set to remove this stipulation and ensure high quality data through requirements for market data contributors to submit their data to CTPs using harmonised templates . As for the mandatory contribution rule , it has been communicated that ESMA-authorised CTPs should collate these individual data sources , with exclusions for some SME ’ s being discussed .
The business case There has been a historical lack of a consolidated data source in the fixed income market , alongside a monopolistic environment when it comes to venues and execution platforms . Owing to this , buy-side firms have regularly been charged high fees for valuable transaction data – to which they have contributed , essentially paying to buy back their own data .
Speaking to The TRADE , Paul O ’ Brien , founder and chief executive of data sharing network Glimpse Markets , explained that this has understandably led to frustration from these firms
“ It ' s critical the buy-side are informed about their data rights , so they feel empowered to use their data in creative ways .”
PAUL O ’ BRIEN , FOUNDER AND CHIEF EXECUTIVE , GLIMPSE MARKETS and emphasised the importance of the buy-side being in the driving seat when it comes to how data is used currently , and going forward .
It remains to be seen as to whether high costs for the provision of data will remain part of the status quo under the new proposed set up . Venues and APA ’ s hold much of the information necessary for a consolidated tape and are therefore key to a CT ’ s potential offering .
A key hurdle for the builders of the CT is centred around the idea that without real guidance , or indeed incentives , the entities holding a vast amount of the data could slow the market and demand potentially high costs for the provision of this information , effectively maintaining the – what many believe to be unfair – status quo .
This notion hinges on how the CTP will function empirically . They need data – a lot of data , and for good or for bad , those holding the majority must be enticed for lack of a better word . Not to compensate these players will understandably risk the quality of the data itself .
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