28 Feb 2017 Counting the Cost of Consolidation Claims
Despite the promise of synergies that accompany any merger or acquisition, and the tendency toward consolidation in the data industry, overall data costs continue to rise for end-user firms. Joanne Faulkner investigates whether M&A save money for end users, or just for the shareholders of the companies involved.
Consolidation among vendors, brokers and exchanges is nothing new. As one industry consultant put it, the landscape has changed greatly since the “crisis years” of 2007 and 2008. Then, it was “everyone for themself,” whereas now “the ‘sharing economy’ has expanded into mergers and acquisitions, where it is considered best to pool resources rather than compete with finite resources.”
The reality is that the financial data industry, like any other, is filled with competitive forces. Companies that face burning out on their own are often snapped up for their assets, or are simply allowed to fade away.