CME Eyes Summer Data Protocol Switch

The group announced it was evaluating binary alternatives to its existing FIX/FAST data compression standard in May 2012, in response to a lawsuit filed by IXO/Realtime Data against exchanges and vendors utilizing the standard’s data compression algorithms, and based on the emergence of new protocols that surpassed the performance of FIX/FAST.

CME plans to roll out MDP 3.0, which leverages the Simple Binary Encoding (SBE) format developed by industry standards association FIX Trading Community, late in the second quarter or early in the third quarter this year. The launch will include a six-month grace period where the two standards will run side-by-side to allow customers sufficient time to test and cutover to the new compression standard, says Brian McElligott, managing director of market data and information services at CME Group.

“When we changed to FAST seven or eight years ago, it was the latest and greatest encoding technology, but now binary is more in tune with how much messaging we’re requiring and what our customers are requesting,” McElligott says. “[The switchover] will require some effort on the customer side. They will receive new specifications from CME and will have to write to those, but it will make the delivery of our data much more efficient, and also gives us a better framework to incorporate new functionality into the datafeed down the road, such as analytics and deeper views of our market.”

The binary compression will reduce the amount of bandwidth required to carry single market data messages, though official performance figures are not yet available.

Meanwhile, in addition to how clients access its real-time data, CME Group also plans to enhance the way customers access its historical data, by introducing a new cloud-based service to complement its existing FTP file delivery mechanism. McElligott says the exchange is currently reviewing emerging technology for how it delivers—and how customers access—its historical data, such as cloud services, applications and mobile access.

“The immediate opportunity for us is our historical data, but maybe there is potential to do something around real-time data, too. We already store all the data, and we will continue to store it—not locally here, but in the cloud so that customers can download what they need when they need it, and not duplicate the storage requirements,” he says.

Non-Display
Separately, last week, the CME notified clients of changes to its non-display policy that include a new tiered pricing model for  non-display licenses, after introducing a flat fee of $670 per subscriber for usage of data from its CME, CBOT, Nymex and COMEX markets in November.

Firms with a small number of users subscribing directly to CME data will be charged a license fee of $375 per month per exchange, while firms whose non-display data access is managed by a data vendor will pay $170 per month per exchange.