By Mauricio Gonzalez Evans
It is no surprise that entitlement management is a chief concern of market data consumers such as asset managers, hedge funds, investment banks, etc. Every data provider, whether it be LSEG, Bloomberg, ICE, Tradition, or others, have a different entitlement system with different user interfaces. In some cases, they only provide “honesty statements” because the tools they deliver are inadequate to properly track data usage. Data consumers are forced to build platforms and hire a team of people to keep control of the data sets they have today. And when the data providers come knocking to check on usage, the result is often contentious and expensive for the data consumer. Why would any consumer ever consider bringing in additional data sets or consider changing data providers if the existing world is already untenable? This keeps costs high, services levels low and stalls innovation.
At BCC Group, our Point of View is that the data consumer should not have to worry about entitlement management. This should table stakes for any platform you own. The business user should only be concerned about getting the right data in the right place at the right time to achieve alpha. BCC Group has spent a great deal of time studying and building the ONE Platform, our flagship product, to manage entitlements properly.
We have learned that there are five (5) key challenges:
| There is limited control over which consumers have access to data inside an application. |
2. Vendor API | When data is delivered into applications directly using a vendor API, without using a distribution platform or an intermediate on-behalf service, there is little or no control over which user has access to data. |
3. Paying for unused data | Usage control is not possible if connections to data consumers go into applications, tools, and databases directly and do not use a distribution platform. |
4. Reporting | There is no standardized reporting across all data sets. Reporting is minimal or insufficient with most data providers. Especially for those that do not provide a distribution platform with entitlement control. |
5. Centralized Management | Turning on and off data access for all vendors and, most importantly, enforcing them. |
In summary, there is insufficient control over data distribution, limited enforcement, and numerous reporting loopholes. This situation is forcing data consumers to be locked into their current providers and unwilling to explore alternatives. Entitlement done correctly saves money and enhances the consumers ability to achieve alpha.
What are the challenges implementing entitlement systems and enforcing permissions?
Old Software Code – the original developers have left or retired. Existing multi-user applications must implement on-behalf entitlement per user. To do so, the internal (server-based) data delivery must be enhanced with permission checks. This allows entitlements to be enforced. Market Data developers for the old software code are hard to find.
Limited Entitlement Inquiry - There is no place to lookup entitlements. With no central service to lookup, for a user and for all vendors, there's no chance to enforce or control.
Mixed Payment Scenarios - Different entitlement payment scenarios. Look-up is required. Bloomberg uses EID, LSEG PROD_PERM & PEs, and entitlement per exchange is challenging.
Charge Per Inquiry - Services may be charged per request, per instrument, per connection, etc.
Development Chaos - Developing against multiple different vendors at different times in the history of a company produces chaos with different API versions for the same vendor. In some cases, multiple vendor APIs are programmed into the same server-based application. The complexity to change a market data service backend to enforce entitlements across different vendors simultaneously leads to basically a full rewrite. As mentioned in point 1, it is already a problem to find skilled market data developers with specific knowledge of one vendor API. Imagine having two or more.
How can this innovation hampering dilemma be solved. Three simple steps to change the market data world:
Install a Multivendor Entitlement Control Service (MECS), with an on-behalf permission lookup service. It is also available as a service, from any cloud.
Install a Multivendor Market Data Distribution Platform that supports all market data vendors, thus leaving the vendor API problems to the platform. The platform vendor has only one job to do, to keep vendor APIs up to date. Because technology providers do not sell data, all data vendors are happy to cooperate. Separating technology from data is also in the interest of data vendors.
Adapt all existing applications to use this new ONE API. In some cases, it is even better to write applications from scratch, making them cloud native or even to run them on-premises
If only one of the "Five key issues with entitlements" applies to your market data universe, then we should talk. We should also connect, if you desire to consolidate an existing platform into the ONE Platform.
Please Contact: bill.bierds@bccgi.com or Alexander.Gonzalez.evans@bccgi.com
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