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Tuesday, May 29, 2007

Data News #2007 - 39
Reminder: NASDAQ Provides Guidance on Level 2 Pricing

Please Route To:
  • Direct NASDAQ Data Feed Subscribers
  • Market Data Administrators

Summary:
  • As announced in NASDAQ Vendor Alert #2007-014, NASDAQ is in the process of migrating customers from the NASDAQ Quotation Dissemination Service (NQDS) data feed, which will be retired on August 31, 2007, to the new Level 2 data feed.
  • The new Level 2 data feed will be subject to the current Level 2 (NQDS) fees for NASDAQ-listed data as well as OpenView Basic fees for non-NASDAQ listed data.
    • Level 2 data feed subscribers are now responsible for the OpenView User Fees, beginning May 1, 2007.1
    • NASDAQ will begin assessing OpenView Distributor Fees for Level 2 distributors in October of 2007.

Overview:
As announced in NASDAQ Vendor Alert #2007-014, NASDAQ® recently introduced a new Level 2® data feed, which features the NASDAQ market participant top-of-file quotations with actual share size for non-NASDAQ listed issues (OpenView BasicSM data) as well as for NASDAQ-listed issues (legacy NQDSSM data).

As the new Level 2 data feed includes both legacy Level 2 (NQDS) and OpenView Basic data, NASDAQ is assessing both the current Level 2 (NQDS) fees as well as the current OpenView Basic fees for firms that distribute the non-NASDAQ listed data in addition to the NASDAQ-listed data. NASDAQ plans to file with the Securities and Exchange Commission (SEC) for a simpler, harmonized pricing schedule for the new Level 2 data feed once NASDAQ’s other pending fee filings have been approved.

Fee Schedule:
For the new Level 2 data feed, NASDAQ is assessing both the current Level 2 (NQDS) User Fees and the current OpenView User Fees, effective May 1, 20071:

NASDAQ Service Level Monthly Fee (per user)
Level 2 (NQDS) $30 - Professional
$9 - Non-Professional
OpenView Basic
(Top-of-file only)		 $6 - Professional2
$1 - Non-Professional

For the new Level 2 data feed, NASDAQ will assess the current OpenView Distributor Fees in October of 20071:

NASDAQ Service Level Monthly Fee
Direct Access - Allows distributor to access the data feed via an extranet provider or direct connection to the NASDAQ data center $1,000
Internal Distributor - Allows distributor to provide the data to internal subscribers only $500
External Distributor - Allows distributor to provide the data to internal subscribers as well as to all of its controlled subscribers. This includes end-user subscribers but does not include distribution to retransmission data feed subscribers $1,250

Reporting Obligations:
Beginning with the service month of May 2007:

  • Distributors must report each subscriber that receives full Level 2 data (NASDAQ-listed and non-NASDAQ listed) as both a Level 2 subscriber and as an OpenView subscriber.
  • Data feed providers must report each data feed that receives full Level 2 data (NASDAQ-listed and non-NASDAQ listed) as both a Level 2 data feed and as an OpenView data feed.

Contact Information:

1 Firms that take the new Level 2 data feed but verify that they do not use or distribute the non-NASDAQ listed data are not liable for the OpenView Distributor or User Fees.
2 NASDAQ has filed with the SEC to reduce the OpenView Basic Professional User Fee to $5/month.


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