In early March 2020, the United Kingdom’s Financial Conduct Authority (FCA) announced they are undertaking a review of the value of market data, and analytics consumed and used in financial markets, and are inviting submissions to explore 3 specific topic areas:

  1. Trading data

2. Benchmarks & Analytics

3. Market data vendor services

This is an initiative to be welcomed if the intention is to create a balanced view of the role that market data plays within financial markets, the dynamics between data sources, Intellectual Property creators, and the market data vendors which act as the interface between the sources and the data consumers. It must not be another attempt to just look at costs, without objectivity or understanding the consequences, that were the features of the recent ESMA (please read article at and Optimus reports.

Given London’s role as the global financial centre, what the FCA review produces will be paid attention to by a wide audience, so it is important the contributor submissions reflects this.

What the FCA is going to discover is that:

• The world of market data is a far more complex than a simple Rubic’s cube

• More time is needed for submissions, the 1 May 2020 cut off date is too soon to gather enough information from the broadest spectrum of potential respondents, especially in the current environment

• There are 8 main areas that should be addressed which I have listed below


The FCA’s consultancy remit is so incredibly broad they need to be broken down into 8 important digestible elements that define the relevance of market data industry to the financial markets so achieving credible inputs which produces findings that have a positive effect. Each of these 8 could easily be a study in themselves.

The 8 riddles flow in order:

1 .Just how important market data is to the efficient functioning of global financial markets, for instance when Bloomberg and Refinitiv go down (and they do), then it becomes ‘Panic Stations’

2. The impact of data ownership and intellectual property rights (IP), where companies that own data IP are more valuable and successful than straight aggregators

3. The marketplace for data is so large and diverse that trying to establish where competition does exist and where it does not, lacks transparency and is a challenge. The sheer range of datasets, their attributes, and usage purposes has never been truly mapped, despite attempts, and maintaining a current database is next to impossible

4. The difficulties in sourcing data from multiple content suppliers then standardising/normalising that data into a common and shared environment. This in turn leads to a quantitative versus qualitative debate, when certain data of unknown provenance start to trigger automated events in trading, risk, reporting and other mission critical applications

5. Growth of micro-monopolies in key areas, i.e. Evaluated Pricing, and RegTech

6. That in benchmark indices, ‘brand’ has greater value than the function in usage, with resultant profit margins

7. When financial institutions rely on the same data, they are forced to compete with better analytics and data management tools from pre-trade through to post trade, and regulatory reporting. Value add tools and efficiency then becomes more important than the raw data, shifting the point of competition downstream

8. Barriers to entry into market data are breaking down as the cost of investment in infrastructure drops, and more data sources are coming online with newly acquired global accessibility, opening up competition from source to consumption


As already noted the cut off date for submissions is the 1 May 2020. Given the global nature of financial markets and the market data industry that supports it, the widest possible range of submissions from British and non-British interested parties would be beneficial.

For further information:

FCA Announcement

FCA Paper can be downloaded at

Profit & Loss Magazine Article

Things to look out for:

• Regulators shifting from defining how market data is being used, to being far more detailed on what data is being used

• Licence regime for market data distributors. One for sources, especially in OTC markets, other than already regulated entities, is going to be to be to much of a challenge, so regulators will rely upon the vendors to police the sources in terms of data quality

• The role of technology, whether legacy systems locking clients into long term relationships, or new tech which allows competition to flourish

• Whether market data contracts terms and conditions are fair, or appropriate, in terms of financial market cycles 

• Inevitably cost of data, though it would be preferable if this is put into the context of usage, and the fact that data consumers don’t subscribe to market data out of the goodness of their hearts, but to make money out of it, in multiple ways