Interactive Data Corporation is stepping up its focus on Asia and a key element of what it is offering in the region and for which it says Asian demand is growing are its pricing and reference data capabilities. Interactive Data’s approach in Asia “is not at the division or product level”, according to Roger Sargeant, who leads its international business development strategy. Indeed, “there is a requirement for all our business lines”, he says. That said, he adds: “We’re seeing continuing growth in our pricing and reference data offerings, utilising our existing pricing, corporate actions, dividends and evaluations services – especially our fixed income evaluations.”
A major driver in Asia, he reckons, is that “firms are developing automated processes to replace historic manual processes, so the need for more and different types of content is also growing”. The vendor has also identified demand for its fixed income analytics, Sargeant says, as well as a “growing need for real-time content with more and better local coverage”, opportunities for its Managed Solutions business as a result of the growth of wealth management, and potential for its eSignal business driven by increasing activity in the retail sector.
Interactive Data is not in “uncharted territory” in Asia, Sargeant points out, and has a “solid base” to start from – with offices in Hong Kong, Singapore, Melbourne, Sydney and Japan. However, the vendor is certainly increasing its focus. “We’ve been building our presence in the region for a period of time as we recognise that the market will definitely mature to a position where our products and services are increasingly relevant,” he says. “There has also been a realisation that there’s a pent-up demand for our services.” The importance of Asia for the Interactive Data Business as a whole is, he reckons, “huge” – and sentiment towards the region is unchanged since recent market turbulence.
Sargeant concedes that “historically there’s been a view that the appetite for spending on data in Asia is less than elsewhere in the world” but he reckons this is changing as “usage requirements are increasing”. “As firms invest more in processes and systems’ architectures there is a recognition that they also need to invest in data,” he says, though he agrees “there may be certain markets where there are challenges around pricing until they become more developed and come to the same realisation”.
Following Interactive Data’s recent senior management restructuring (Reference Data Review, October 2007), Sargeant now has “strategic responsibility for the combined non-North America business, with a remit to develop ideas and opportunities for Europe, the Middle East and Asia”. “This will really help us make sure we’re allocating the right resources to these growth markets,” he says, emphasising that “we think about Asia-Pacific as a specific region in its own right, and for a long time have had regional headquarters in Melbourne, run by Jim Farrer. We need to take a local view, and make sure we’re providing products and services specific to the region and to the individual markets within it.”
Ensuring Interactive Data understands “completely the nuances of each market in order to tailor and make relevant” its products and services will be vital for success, he believes – along with “focusing on the markets that are most appropriate” and not spreading itself “too thinly”. Outside the developed markets, the vendor reckons India and China “will become very important”, with others of interest including South Korea, Taiwan, Vietnam and Malaysia.
On the client facing side, Interactive Data plans to build out its scale in Asia. “Interest levels in our offerings have gone up appreciably in the past 12 months and we intend to create a bigger sales force and account management team.”
The vendor is actively recruiting, notably in Hong Kong and Singapore, Sargeant says. “We will also extend some people’s remits to have a global perspective. Dan Campion (who moved from London to Hong Kong this summer in a sales role) is one of the first people to relocate and there may be opportunities for others to do so. We’ll also make sure we keep a good level of knowledge of the local marketplace, together with the necessary linguistic skills. Some of our existing offices in Asia don’t yet cover all our services; we’ll address that to ensure each office can offer all Interactive Data services.” Interactive Data is also continually looking for partnership and acquisition opportunities in markets where it makes sense, he adds – particularly when it comes to serving the needs of local Asian firms. The vendor will “round out” its product capability “to develop locally relevant products” for Asia, according to Sargeant, using development teams in either Europe or Melbourne. Additionally, some of its services in Europe “can be transported to Asia-Pacific” he reckons. “For example, we can immediately transfer our risk and analytics data service, our business entity data service and some of the reference data we have created on the back of regulatory requirements.”
Its fixed income evaluations service as it stands today “is helping to cover our clients’ needs now”, Sargeant reckons – though he recognises it will need to evolve to meet Asian clients’ developing requirements. “On the fixed income evaluations side we continue, on a global basis, to develop services for new asset classes. That’s no different in Asia, where we are focusing on credit derivatives and complex structured products, for example. We have a specialist evaluations team in Asia and to a large degree we have the product capability we need in the region. As investment strategies continue to change, clearly our capabilities will need to evolve,” he adds.