FISD General Membership Meeting

1

• FISD General Membership Meeting
• March 3, 2005

2
Overview of Program

• FISD Operations and Governance Update - Tom
  Davin, FISD/SIIA
• Business Issues Agenda - Tom Davin, FISD/SIIA
• Best Practice Recommendations Service Level and
  Communications
• Claire Pons, Thomson Financial Kevin Morgan,
  Reuters
• Securities Processing Automation FISD Agenda
  Update
• Mike Gillott, Chair, FISD SPA Committee James
  Hartley, FISD/SIIA
• Break
• Transparency Obligations Directive Mark Hynes,
  PR Newswire
• Romanian Currency Redenomination Phil Walker,
  Reuters
• The Next Generation Protocol FisdMessage - James
  Hartley, FISD/SIIA
• FISD Member Survey Preliminary Results Tom
  Davin

3
FISD Governance

• Election of new Chair and Vice-Chair
• Chair John Bottega CSFB
• Vice-Chair Sara Banerjee - Telekurs
• Integration Group Liaison with SIIA Board
• Executive Committee Vacancy
• Vendor representative needed
• Nominate any employee of a vendor member of the
  FISD
• Nominations due March 11, 2005
• New member will be chosen by Executive Committee
  in March
• Constituent Committees reforming
• Exchange, Vendor, and User groups

4
FISD Operations

• Pacific Rim Activity
• New Members
• Member survey
• Planned meeting schedule
• Monthly newsletter

5
Pacific Rim Activities

• September 2004 visits to Pac Rim members and
  potential members throughout region
• Tokyo
• Osaka
• Seoul
• Hong Kong
• Singapore
• Sydney
• Discussion of FISD agenda and liaison with
  standards groups
• Next steps
• Explore idea of annual one-day conference at
  Pacific Rim location
• As early as Q1 2006

6
New FISD Members

• American Stock Exchange
• CAPCO Reference Data Services
• CMS WebView
• IBM
• MicroRose
• Solace Systems
• TAP Solutions
• Xaware Software

7
2005 FISD Schedule

• February  - NYC Issue Brief
• February  28 - March 1 - London General Mtg./XML
  Conference
• May  - Europe Issue Brief
• June 23 - NYC General Meeting in conjunction
  with SIA
• October 10-12 - Rome World Financial Information
  Conference
•  
• November 8 - Chicago FISD Issue Brief (in
  conjunction with FIA)
• November/December - Europe Issue Brief
•  
• December - NYC General Meeting and Holiday party

8
Business Issues Agenda

• Market Data Administration Conference
• New initiative Business Issues Policy and
  Procedure Standards (BIPPS)
• Best Practice Recommendation on Service Levels
  and Communications Procedures

9
FISD Newsletter

• Monthly summary of completed and upcoming FISD
  and SIIA activities
• E-mail distributions
• Provided to all FISD member contacts and other
  interested parties
• First Issue sent in January, February issue sent
  last week
• Need Feedback

10
Market Data Admin Conference

• November 9 in NYC
• Over 100 attendees from major players
• Vendors
• Exchanges
• Users
• Consultants
• Strong positive feedback on program

11
Issues Identified

• Contract Standardization needed
• Policy Standardization needed
• Electronic reporting VRXML etc.
• Electronic Invoicing needed
• Business Models drives admin complexity

12
Contract Standardization

• Wide variety of exchange distributor contracts
  (100)
• Compliance difficult
• Approvals of new systems can take months
• Difficult to change in response to evolving
  business realities
• Exchanges wishing to make progressive changes
  often face protracted negotiations with
  distributors

13
Policy Standardization

• Vendors and users would like more consistency
  across exchanges on a variety of data
  distribution policies
• Top priorities
• Delay interval
• Unit of count
• Timing for reporting and billing
• Subscriber agreements
• Other important areas
• Non-display/Blackbox usage
• Derived data
• Streamline Exhibit A process

14
Electronic Reporting/VRXML

• VRXML implementation headaches
• More and better documentation needed
• All-or-none file failures can be obscure
• Several media currently used
• VRXML
• VARS
• Excel
• Regardless of system, garbage in, garbage out
  still applies

15
Electronic Invoicing

• Electronic invoicing standard is very desirable
• For both vendor and exchange invoices
• New standard may not be necessary
• Existing commercial standards may fit the bill
• Standard should be developed/chosen based on the
  interests of all constituencies

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Business Model

• Technology has outstripped business models
• Underlying exchange and vendor business models
  unnecessarily complex
• Complexity of business model causes
• Complexity of administrative burden
• Inadvertent non-compliance
• Enterprise license models are desirable

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Potential FISD Initiatives

• Update FISD Model exchange contract and promote
• Develop Best Practice Recommendations for
  exchange policies
• Retool, refocus VRXML working group
• Create group to work on choosing/developing an
  electronic invoicing standard
• Priorities?

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Priority Identified - BIPPS

• Develop and promote Best Practice Recommendations
  for exchange policies
• Working group established in January
• Approximately 20 members
• Business Issues Policy and Procedure Standards
  (BIPPS)
• Delay interval
• Unit of count
• Timing for reporting and billing
• Subscriber agreements
• Next step is promotion of BIPPS Recommendations

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Delay Interval Recommendation

• Delay interval should be 20 minutes or less
• Delay interval should be in five minute
  increments i.e., 5, 10, 15, or 20 minutes
• Iterative process
• Any significant delay renders data
  non-competitive with real-time
• Exchanges with intervals lt 20 minutes should stay
  in place

20
Unit of Count

• End-user
• Natural person that receives data
• Traditional market data usage
• Device-based entitlement acceptable
• Simultaneous Log-in should be
• Prevented
• Recorded, Reported, and Paid for

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Subscriber Agreements

• Preferred Recommendation
• Allow vendors agreement to cover and protect
  exchanges
• Alternative Recommendations
• 2) Consolidated Agreement
• AND
• 3) Electronic Execution

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Reporting and Billing Timing

• Recommendation not completed
• Key elements
• No pro-ration
• Snap-shots based on mid-month populations
• Reporting submitted by end-of-month
• Invoicing at beginning of next month
• Monthly reporting and billing
• Billing in advance vs. billing in arrears
• Self-invoicing

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Best Practice Recommendations

• Working group seeking to provide exchanges with
  BPR on several key areas
• Service Levels
• Response Times
• Communication Procedures
• Working Group Representatives
• Claire Pons, Thomson Financial
• Kevin Morgan, Reuters

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FISD Member Survey
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Member Survey

• Seeking feedback from members on
• Satisfaction/Value of membership
• Relevance of current agenda
• Ideas for new activities
• Scheduling
• Survey logistics
• All 100 FISD members
• Online survey
• Administered via e-mail 15 Feb 2005

26
Demographics

• 30 respondents
• 70 from North America
• Equal balance among vendors, exchanges and users
• Global interest

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Preliminary Results

• Overall satisfaction
• 61 Satisfied or Very Satisfied
• Strong Support for Pacific Rim activity
• 71 wanted to see extension of FISD activities
  into Pacific Rim
• 50 of supporters thought it was Very Important
• Engage now on existing issues and agenda
• No consensus on strategy for meetings or
  organization

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Events

• Relevance of FISD events confirmed 70 for all
  events
• General Meetings
• Conferences
• Issue Briefs
• World Financial Information Conference
• Meeting frequency is right
• Balance between North America and Europe is right

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Communications

• Valuable communications media
• FISD.net (77)
• Division electronic newsletter (65)
• Single topic e-mails (62)
• UPGRADE magazine
• 60 receive
• 70 of those read it
• More financial data content needed

30
Business Issues

• Best Practice Initiatives are Very Relevant
• Service Levels and Communications (79)
• BIPPS (72)
• Other relevant activities
• Redistribution Working Group (76)
• Electronic Reporting and Billing (72)
• Contract (79)

31
Securities Processing Automation

• Reference data and standards activities relevant
• Data Model/Vocabulary (61)
• Instrument Identification (57)
• Entity Identification (61)
• MDDL (50)
• High Dont Know, N/A for fisdMessage (35)

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Other Activities

• Government Affairs
• EU Directives (59)
• SEC Regulations (65)
• Networking (90)

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Themes from Open-end Responses

• More interaction and engagement with
  non-Executive Committee members
• Complete discrete projects, dont let them run on
• More global focus Asia, Latin America
• More support for MDDL

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Next Steps

• Not too late to respond
• Contact FISD if you need a copy of the survey
• Final Results will be analyzed by Operations
  Advisory Committee
• Report back to full membership in Q2