Bloomberg has responded to the European Commission’s decision to accept proposals from Thomson Reuters that open its Reuters Instrument Codes (RICs) to greater market use, by welcoming the change, but warning that compliance is critical if an open market for consolidated real-time data feeds is to be created.
The company stated: “In a press release issued today [20 December 2012], the European Commission announced that it has adopted a decision to implement commitments intended to remedy competition concerns relating to Reuters Instrument Codes (RICs). While details will have to be reviewed when the commitments themselves are published, we welcome the Commission’s efforts to promote competition and transparency in what has been a non-competitive market. As Thomson Reuters’ two prior proposals to the Commission fell far short, we hope that today’s order creates an open market, and that the appointment of an independent trustee ensures compliance.”
Bloomberg would not be drawn further on precisely how it considered the previous proposals “fell far short.” But like Thomson Reuters and despite its existing commitment to open symbology, it is most likely back at the drawing board considering how the change to RICs licences will impact its position in the market and its competitive stance vis-à-vis Thomson Reuters.
While Thomson Reuters spent this year working with the Commission to reach an agreement on RICs licences that would open the market for consolidated real-time data feeds, Bloomberg has spent the year extolling the virtues of open symbology and set down markers that other market data vendors will find it difficult to contest if they too are too offer true open symbology solutions.
An example of Bloomberg’s commitment to open symbology and its adoption in the market is the early 2012 addition of the Financial Industry Regulatory Authority (Finra) to a growing list of organisations recognising and using Bloomberg open symbology. The nod from Finra was seen by financial firms as another step along the way to using open rather than proprietary symbologies designed to improve market connectivity and transparency, while reducing users’ costs.
At the time of the Finra agreement, Peter Warms, head of Bloomberg’s open symbology group, described his role as ‘spreading the gospel of open symbology’. He said: “Finra was among the organisations at the top of the list to approach. The market was keen to use open symbology to report to Finra and conversations with the regulator soon made clear the benefits of including it. This is a significant splash for us in terms of gaining traction in fixed income markets and we hope to see a ripple effect beyond fixed income as other organisations see the step Finra has taken.”
Warms described hundreds of clients using Bloomberg Global Identifiers (BBGIDs), which are part of the Bloomberg Open Symbology (BSYM) campaign, including exchanges such as NYSE, ACE, FTSE, Osaka and Bermuda, and third parties such as Asset Control, Flextrade, GoldenSource, Imagine Software and Murex.
No doubt the list has lengthened through the remainder of the year, giving Bloomberg, Thomson Reuters and others in the market data community much to think about following the Commission’s decision on RICs and ahead of a year when regulatory, cost and practical implementation issues will lead many market participants to increase their scrutiny of market data.