Data vendors provide different forms of data to their customers, based largely upon the industry and the specific instruments important to each industry. Financial data is distributed to companies across industries, as stock exchange indices are important to hundreds of markets. Commodity information specific to an industry may be sold to key players within that industry.
Generally, these information brokers take the raw data from a given source and put it into their proprietary systems to manipulate into more useful information. Data vendors sell this manipulated data to players within an industry who will use the data provided to make decisions. Each data vendor must decide how much data it will pull together to then redistribute to its customer base.
Financial data vendors pull together information regarding stock exchange transactions, regulatory filings, and a variety of financial instruments. These data objects are stored in the vendor’s computer systems. Once the data is manipulated and placed into the format the company sells to its client base, the data is transmitted to the client base. Most data collection and transmission occur during the off hours, as the client base uses the information for the following day’s activities.
Financial data is sold based upon how the client intends to use the information. Data vendors differentiate their data offering based upon delivery method, frequency, transfer, format, or normalization of data. Each client must determine which vendor provides data in the format that best fits the client’s use of the data. Customer service provided by each company can also influence the client base in determining from whom the client will purchase the data.
Commodity data is collected by smaller data vendors or divisions within larger data processing companies and sold to industry participants. Specialized data vendors sell to each of the commodity industries, such as electric transmission, natural gas, and petroleum trading. Some client groups purchase all commodity information for a larger area, such as energy trading, and others are interested only in one specific commodity.
Online marketers are interested in acquiring data regarding the number of visits to a particular site or the top searches completed on specific search engines. Data vendors collect this information and massage it into numbers valuable to online sales and marketing companies. Some big market participants collect so much information of their own that they can in turn sell this composite information to other companies without breaching any specific privacy policies. Consumer product organizations gain access to more detailed information regarding their client base using these services.