NYSE Resolves Dispute Over Real-Time Quotes

from the coming-to-you-in-real-time dept

Back in November we mentioned the story of various online finance sites complaining to the SEC about the high prices that stock exchanges were charging for access to real time-quotes. It clearly seemed like the exchanges were missing the big picture, by trying to make as much money as possible upfront by selling the quotes, as opposed to seeing the long-term value of giving out more useful data to the public. It appears now that the impasse has been resolved, with the NYSE coming to terms with Google and Yahoo on a price for real-time quotes. For $100,000 per month, these sites will be able to redistribute the real-time data to their users free of charge. That still seems like a lot of money, and indeed the Wall Street Journal and MarketWatch (both owned by Dow Jones) don't think the price is worth it. It is possible that the Journal and MarketWatch just don't think there's much need for it, since presumably a high percentage of their readers have access to the data through an online brokerage account. Even with the new agreement, it still seems like the exchanges are shortsighted to nickel and dime the online finance sites over this data.
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  1. identicon
    Lee Furnival, 12 Jan 2007 @ 1:13pm

    Reality Check

    Ok, a few thoughts here...

    With regard to the first reply, the thought that you could, for only $100,000, hire people to watch and report live trades is absolutely ridiculous! Consider the following:

    Assume you pay an entry-level data entry rate of $3,000 per month, and assume a 15% employee burden for taxes and very minimal benefits. For $100,000 you would be able to hire at most 29 employees, not counting any other expenses whatsoever.

    The reality is that 29 employees would not even be able to keep up with a single stock such as AAPL, let alone the thousands of security instruments on the US exchanges. For example, AAPL yesterday (1/11/2007) had 228,387 trades reported during market hours only. This is approximately 10 trades per second. At this rate, not even 10 employees could keep up with this trade volume.

    I agree with the 2nd poster - if you need real-time quotes you will have different tools to use already and thus any delayed quoting on Google or Yahoo is irrelevant.

    Posts 3, 4 and 5 - you guys are forgetting that the fact that it is not cheap, or free, to maintain all of the systems to provide the data. It's not like they can just open up a few ports on a firewall somewhere and let everyone get the data the want! The thought that simply because the exchanges facilitate the trades they can automatically deliver data on those trades to anybody who wants it in real-time for free, or at negligible costs, is extremely naive. Furthermore, the implication that since the companies are publicly traded the exchanges should deliver data at no charge is ludicrous. This is like saying that since you own your car, you would expect a tow truck driver to tow your car for free, after all it's your car, right? That is crazy. Obviously the tow truck driver needs to be compensated for the work that he/she does even though you own the car, just as the exchanges have every right to be compensated for work they do, which includes designing, building, and maintaining the data systems that allow the public market to even exist.

    I do however agree with the comment about short sale information, that is bogus and they should report that as trades happen.

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