There are more than 60 equity market operators and some 90-odd data feeds in Europe.
"Imagine you've got all the major data vendors having to capture all those feeds, understand the logic of the feeds and try to normalise the output in order to have a coherent output for the end user," said Marc Berthoud, executive director, SIX. "The point is, for those 90 feeds there is no chance for the data vendors to have a fully converging educated guess of the data normalisation process."
MMT promises to change all that.
Instead of having to produce individual best guesses on the normalisation process, vendors would know that there was a standard in place for all trade messages. Trades of a similar nature would get flagged in a similar way and the data vendors could consume all the data in an automated way. No local reinterpretation. No guessing. No fuss.
"So in terms of reducing the costs of data consumption, the mid-term perspective is a huge reduction in the expenses," Berthoud said. In absence of something like MMT, vendors typically would have to employ squads of specification experts and developers to understand the logic of various feeds.
Beyond making life easier for vendors -- and by extension the clients of those vendors -- MMT has a number of other attractive features. Perhaps chief among them is how it provides an example of how the industry can work together, offering valuable lessons at a time when many in the financial community want to pursue industry-led solutions rather than finding themselves subject to regulatory cudgels.
As industry collaborations go, MMT is more the exception than the rule.
"I think it's fair to say it's been relatively rare," said Andrew Allwright, head of regulatory strategy for trading at Thomson Reuters, when asked whether there were many other instances like MMT. "It probably reflects the fact that there are common interests in terms of delivering a standard set of trade identifiers. Delivering a standard set of trade identifiers is something that really isn't against anybody's interest and is in everybody's interest."