FiNETIK – Asia and Latin America – Market News Network

Asia and Latin America News Network focusing on Financial Markets, Energy, Environment, Commodity and Risk, Trading and Data Management

Letter from Hong Kong

Last week’s Inside Market Data Asia conference should make vendors sit up and think. Not only is Asia growing in leaps and bounds (and not just in China and India), but it is crying out for better, more suitable products. And it seems clear that they need both local and global vendors to supply them.

That’s because the local vendors can offer local data, timeliness and a deep understanding of the local market. The global vendors, though, have breadth of information and global resources on their side.

A panel of local and global vendors acknowledged this. Stephan Stadelmann of Finetik Partners says, “A global ! vendor has global coverage and a greater financial budget, but in terms of domestic needs is usually not as flexible as local vendors.”

Yet the panel agrees that local and global vendors can be complementary, especially-as Reuters’ Alex Hungate says-in local markets in which a big player might not want to compete.

From the local vendor’s perspective, says Stephen Lai of Singapore’s NextView, “you can’t grow in Asia without [working with] global vendors,” especially if the local vendor wants to move beyond its home market.

In addition, they agree that Asia is a fragmented market, and vendors can’t apply a one-size-fits-all strategy (an issue that was also discussed by the last panel of the day). As Darren Bishop of Tullett Prebon Information says, in the past, vendors based their Asian strategies on Japan. But, he points out, the Japanese market is completely different from, say, the Chinese market. Now vendors are beginning to understand that.

Another theme that developed at the show is a global one: information is useless if it’s not delivered or packaged in a useful way.

In the morning keynote, Micah Green, president of the Bond Market Association, says that while there is more and more data available-thanks to business scandals, customer demand, technological developments and globalization-the key is making it useful.

For example, he cites one firm whose second-largest expense is its Bloombergs. But those Bloombergs are sacred, because they don’t simply deliver data-they are communications tools, as well as being used for analytics and processing. Green says Bloomberg’s competitors have begun to look at and market their products differently, to show how they can support a user’s business.

This trend is also being driven by increased transparency, which has in turn lowered profit margins on trades. “How do you raise your profits?” Green asks. “You have to reduce your costs.” As a result, firms are applying technology to their data to improve processing and risk management, which then lowers costs and improves profits, even when margins are falling.

S. Swaminathan, CEO of Indian vendor Iris, echoed this theme in his afternoon address. Vendors need to take their data and develop applications around it to serve their customers. “[They say] there’s an information overload,” he says. “There’s not too much information; it’s, ‘can you give me the information I want, how I want it and when I want it?'”

Swaminathan suggests that both local and global vendors apply this advice, particularly to India, which is expecting a huge inflow of domestic investment over the next five years. He notes that this is also a great opportunity for Indian companies and the Indian people: “Until now, we were a factory for the world, we never met the customer, so the benefits flowed to someone else. Today, we are working with the customers.”

By Samara Zwanger
Source: Inside Market Data: November 21, 2005 Vol 21 No9

Filed under: FiNETIK News, News, , , , , ,

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