More than four-fifths of all financial services institutions believe there are savings and efficiencies to be gained through coordination and rationalization of data management activities supporting front- through back-office functions, according to a survey of around 100 reference and market data managers conducted by A-Team (publisher of A-Team Insight) through September. Indeed, over 30 percent already have a centralized approach to management of data across the enterprise.

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Today’s CIOs have substantially different job functions than their 1990s equivalents, according to a new report from the Tabb Group. The study – Value Management: Aligning IT to Assure Success – surveyed CIOs at 12 firms ranging from small to large within the financial services sector. It found that CIOs spent much of their time aligning IT with business, making technology more a strategic partner for senior management than in the past. Indeed, only 27% of respondents named technology as a key issue, stressing instead legacy or infrastructure issues. “Partnering with the business,” by contrast, was seen by 92% of those surveyed as their most important function.

A survey published last month by portfolio management systems vendor QED Information Systems, found that almost 90% of the 34 firms surveyed considered an integrated system important to their overall business strategy. Encouragingly for QED, which stresses its low-maintenance, high-integration platform, Q2, 74% said they weren’t currently using such a solution. But the survey also underscored some of the realities of the current business environment. For one, 91% said that the majority of their 2003 technology budgets were spent on maintenance or incremental upgrades to their existing systems rather than on new implementations. Indeed, 80% said they hadn’t significantly updated or deployed a new portfolio management system in the past 12 months. Finally, 53% said they didn’t expect to update their system in the next 12 months. Of course, this could be a glass half full or half empty, depending on your viewpoint. QED vice president of sales, Keith Brodhead, also cites the long sales cycle for these systems, ranging from nine to 12 months.

The need for low-latency market data delivery infrastructures, as outlined in last month’s Insight, has been borne out by a Tabb Group report that predicts meltdown if firms don’t significantly reinvest in their data infrastructures. Pushing the Envelope: Redefining Real-time Transaction Processing in Financial Markets, published this month, reckons algorithmic and black box trading are “pushing market data speeds through the roof to the point where market data tick volumes are beginning to push 2,000 to 3,000 ticks per minute or more for highly liquid securities.” (The U.S. Securities and Exchange Commission’s proposal for Regulation NMS could force the New York Stock Exchange to adopt such systems, see Transaction Networks & Technologies, February 2004.)

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We had to do a double take when we read recently in the Wall Street Journal that Thomson Financial was a newcomer to the business of research integration. After all, didn’t Jeff Parker invent the concept with his First Call service, sold to Thomson more than a decade ago? And didn’t Thomson scoop up perhaps its closest competitor – the Institutional Brokers Estimate Service (I/B/E/S) – through its purchase of Primark a few years back, leaving only Multex as the only viable alternative in the space?

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You know what we think about this. A very good friend of ours is a corporate lawyer, who shakes his head every morning while reading the Wall Street Journal at breakfast.

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Yowzer!When New York Attorney General Eliot Spitzer blasted a shot across the bows of the major Wall Street investment banks, challenging them to shape up their research conflicts of interest or ship out, it wasn’t only the banks that were alarmed. Spitzer, a pit bull who makes the prosecutorial Rudy Giuliani look like a Jack Russell Terrier, means business. And so the Big Wall Street Firms took notice when he told their lawyers that he was willing to “dig through e-mails for the next five years” to uncover evidence of wrongdoing in research unless they support his efforts to reform the business.

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After years of life in the backwater, the middle- and back-office data business is now becoming as dynamic as the front-office data business was in its heyday of the 1980s. According to A-Team Consulting’s latest report – Securities Administration Data: The Essential Piece of the STP Puzzle – the business is now worth half a billion dollars and is growing at a pace.

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