LSEG’s Refinitiv to deliver Real-Time Full Tick data on the cloud in 2023
The data vendor has 19 points of presence from where it will provide co-located access to the new managed services by Q2 2023.
Refinitiv, the data business owned by the London Stock Exchange Group (LSEG), will make its Real-Time Full Tick data available on the public cloud next year. The move comes as many banks and asset managers are shifting more of their applications to the cloud and demanding their vendors follow suit.
“More and more of our customers over the last year have been saying they’re moving their workloads to the cloud,” Jason West, director of Real-Time Managed Distribution Services (RTMDS) at LSEG, tells WatersTechnology. “So instead of providing them with a private cloud connection into their public cloud, they are asking us, ‘Can you build and deploy in the public cloud as well?’”
Real-Time Full Tick is Refinitiv’s full depth-of-book, real-time datafeed delivered via RTMDS. The managed Full Tick service, set to go live on the public cloud in Q2 2023, will include Refinitiv’s Level-2 data, analytics-as-a-service, and the management and maintenance of the feeds in clients’ private or public cloud environments.
Refinitiv has 19 distribution points of presence (PoPs) on its private cloud worldwide and because those are co-located with three of the top cloud service providers (CSPs)—Amazon Web Services (AWS), Google Cloud Platform (GCP), and Microsoft Azure—the real-time services can be fanned out from any of those locations.
West says the demand for real-time datafeeds in the cloud is just one of the reasons Refinitiv is moving Real-Time Full Tick to the cloud. Firms are also requesting the ability to outsource the management costs.
“The simplistic thing about managed services is you don’t have to run a datacenter anymore. You don’t have to release millions of dollars every four years for capital expenses. If you want to scale up very quickly, you can; if you want new datafeeds, you can; if you want to take ESG data or machine-readable news into a cloud environment along with our [other] data products, you can—all via one cloud provider, or multiple [cloud] locations globally,” West says.
West says another driver for the rollout is to provide flexibility to firms that want to shift more of their workloads, including their front-office systems, to the public cloud. Trading systems can more easily integrate with datafeeds if they are hosted in a cloud environment, but real-time feeds are still hard to refactor to deliver low-latency performance on the cloud.
But those clients seeking to connect their front offices with Full Tick can bring their designated CSPs along to partake in the migration plans.
“It’s like a tri-party gathering where we get together, we try to understand what they’re trying to do—what they’re trying to migrate—and then we’ll help them push it out,” West adds.
Testing the waters
Refinitiv’s Real-Time Optimized (RTO), a real-time API-delivered pricing feed that updates three times per second, is already available via AWS and can be piped directly to users’ virtual private clouds (VPCs). Over the last 12 to 18 months, the group has onboarded 500 clients to the real-time service via AWS.
The data vendor ran a proof-of-concept to offer managed services for RTO via the cloud to a tier-one bank that didn’t have an existing relationship with AWS or Google. Refinitiv was not authorized to publicly name the client.
Refinitiv took its RTO feed from AWS, ported that into GCP, and used Google’s BigQuery to develop time-weighted average price (TWAP) and volume-weighted average price (VWAP) calculations on several indexes. The tier-one bank then connected to RTMDS and pulled the analytics files via a web browser.
“We found that they were a lot quicker to come to us for this [service] than to get their internal technology teams to spend the capital to build and manage it,” West says.
The proof-of-concept took the RTMDS team five days to build, West adds, and is now live.
Cloud challenges
While the move may enable firms to streamline some capital expenditure, some warn that there is a big misconception that moving to the cloud or using the cloud means automatically cutting costs. For example, says one senior manager at a tier-one bank, while firms can expect to wind down or remove some dependency on legacy systems, the management fees for running cloud-based applications and pipes that connect to them can add up. To begin with, there are direct expenses to contend with, the senior manager says—such as the cost of compute power, the network, and the storage—while simultaneously running on-premises applications elsewhere.
“People look at that and think, ‘Should I move to the cloud to make it cheaper?’ It won’t be cheaper,” the senior manager adds. “Also look at your indirect costs: ‘How many engineers am I paying to work with all of this data wrangling, or how many circuits do I have to pay for?’”
And in some corners of the market, firms are hesitant to shift their critical workloads to the cloud, largely because of concerns about concentration risk, vendor lock-in, and year-on-year price hikes.
“They are signing multi-year contracts with the cloud providers that might come back to haunt them in future years in the form of very substantial price increases,” says Octavio Marenzi, CEO and founder of Opimas, a Europe-based consultancy firm. “Once you’ve outsourced an essential component of your infrastructure to a cloud provider, it’s very difficult to move it—it might take years to do that. In the meantime, the cloud provider can substantially increase their prices.”
Cloud vendors have not yet dramatically increased their pricing, but Marenzi says there is enough evidence to suggest that heavy reliance on one or more providers could spell bad news for the end user’s long-term bottom line. “We have seen this occur with software providers that have been acquired or have changed their pricing policies—they put in place substantial price hikes.”
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