2nd UPDATE: NASDAQ OFFERS FREE, REAL - TIME STOCK-PRICE DATA

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2nd UPDATE: Nasdaq Offers Free, Real-Time Stock-Price Data
Dow Jones
June 02, 2008: 03:19 PM EST

(Updates throughout to note it is a one-month trial program, adds comments from Nasdaq executive, context on dispute over access to market information and latest share prices.)

By Doug Cameron

Of DOW JONES NEWSWIRES

Nasdaq OMX Group Inc. (NDAQ) announced plans Monday to provide free, real-time stock-price data through online vendors such as Google Inc. (GOOG) as part of a one-month trial program, a move that comes amid a debate over access to stock- market information.

Retail investors had been limited to price data with a 15-minute to 20-minute delay from the major U.S. equity exchanges, which derive a large part of their revenue from charging institutional clients and online brokerages for more- detailed information.

Under the pilot program announced Monday, Nasdaq will allow its online partners to redistribute real-time stock-price data this month, at no cost to the online partners or the end user. After that, Nasdaq will charge the vendors up to $150,000 per month for the right to distribute the real-time data, leaving the partners to determine whether they will continue to provide the information free of charge.

NOTE: NASDAQ IS A WELL RESPECTED COMPANY IN THE STOCKMARKET INDUSTRY.

Nasdaq said it will provide "last quoted price data" for stocks on its own bourse, the New York Stock Exchange and the American Stock Exchange. Professional traders will still be charged for "depth of book" data such as trading volumes at particular prices.

Adena Friedman, Nasdaq OMX's executive vice president, said the move was " overdue," claiming to be the first U.S. stock exchange to offer free, universal access to real-time data.

The move comes more than a year after efforts by Nasdaq and the NYSE to publish free price data foundered amid opposition from some online vendors represented by the NetCoalition, an industry lobby group. The U.S. Securities and Exchange Commission has also failed to sign off.

Nasdaq has refiled to the SEC for permission to provide free, real-time quotes. Meanwhile, NYSE, a unit of NYSE Euronext (NYX), said Monday its own plans to offer free data have been awaiting approval from the SEC since January 2007. The SEC didn't return calls seeking comment on Nasdaq's latest move.

"We have returned (to the idea) as a pilot project," Nasdaq's Friedman told Dow Jones Newswires, noting that Nasdaq will waive charges to its online partners during June.

In addition to Google, vendor partners for the free data include business TV channel CNBC, a unit of General Electric Co. (GE), Xignite, an online quote service, and WSJ.com, a unit of News Corp. (NWS), which also publishes The Wall Street Journal and Dow Jones Newswires.

Friedman said the pilot would allow online vendors to develop a business model for providing the service. After June, Nasdaq will charge online vendors $100, 000 a month for access to data from its own platform, plus $50,000 a month for prices from NYSE and the Amex.

Friedman said the last quote price data had become an "innocent victim" of a wider debate at the SEC over ownership and access to depth-of-book data. She described the new initiative as "a safe way to start."

Nasdaq Doesn't Expect Revenue To Suffer

Nasdaq's move also reflects intensifying competition in the U.S. cash equities market, with Nasdaq and NYSE Euronext losing market share to electronic rivals such as Kansas City-based BATS Trading.

BATS last week launched real-time price quotes via Yahoo Inc. (YHOO), though it said it had never charged for data as part of its pitch to undercut trading costs on established exchanges. BATS has lifted its share of U.S. equities trading above 10% and is applying for regulated exchange status, with plans to launch a European platform later this year.

"We believed that market data - including full depth of book, not just last quotes - should be free to investors," said Randy Williams, a BATS spokesman.

Nasdaq OMX generated 22% of its revenue from market data related to its U.S. and European exchange platforms in the first quarter of 2008, its second-largest business segment after issuer services, which accounted for 23%. U.S. equities trading fees accounted for 16% of sales in the quarter.

NOTE: NASDAQ'S MONEY MAKING SCHEMES ARE NOT ONLY EFFECTIVE BUT ALSO BENEFITS IT'S CO PLAYERS..

Friedman said the trial wasn't expected to have a negative impact on revenue. Nasdaq plans to launch a similar trial for data from its European exchanges this month.

Nasdaq shares were recently down 3.7% at $33.73, in line with a broader downturn for exchange sector stocks.

-By Doug Cameron, Dow Jones Newswires; 312-750-4135; doug.cameron@dowjones.com

(Shara Tibken contributed to this report.)

(END) Dow Jones Newswires
06-02-08 1519ET
Copyright (c) 2008 Dow Jones & Company, Inc.

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