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I think the delineation between trading terminal and quote and charting
service is the key one. If the quotes are on a trading terminal that the CME
is going to receive fees for trades done, then they have that income stream.
If the feed is going to a charting system, then there may not be trades
generated, thus no income. So they charge for that.
Also, I think the CME was very aggressive in going to the free quotes for the
emini contracts, currencies and newer contracts. I think this was one of the
keys to them establishing the new emini markets. However, the other
exchanges only matched the CME with limited time offers for free quotes. The
market did not move to the CME position. Thus, the CME moved back to where
the rest of the market was. Right or wrong, I can understand this
competitive stance, especially in light of the next generation trading
terminals which will have the streaming quotes.
Of course, if the CBOT had a pile of cash rather than a pile of debt, we
could have come out with a different outcome to this. They may have well
matched the CME's free quote offer. But we will never know.
Regards,
John J. Lothian
Disclosure: Futures trading involves financial risk, lots of it! John J.
Lothian is the President of the Electronic Trading Division of The Price
Futures Group, Inc., an Introducing Broker.
In a message dated 12/21/00 1:04:48 PM Central Standard Time,
sean@xxxxxxxxxxxxxxxxxxxx writes:
<< Good points John. However, many users of lower end data feeds have been
known to look at the live charting web page at quote.com when their own
feeds are down. This service will not remain available under the new plan.
The CME's biggest mistake, however, is the increase in fees from $10/mo to
$60/mo for non-professional, real-time data. The whole idea of the $10 fee
was to get the stock trading day traders to add the feed and, potentially,
trade the mini s&p and nasdaq. The discounters will tell you that this
strategy has been a success.
I have watched the merc and the board shoot themselves in the foot so many
times over the years. Let's see what the CBOT does to match this blunder.
Perhaps they could raise fees for a/c/e bonds and notes traded during the
regular trading session!
Sean
>>
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