Federal Register / Vol. 77, No. 35 / Wednesday, February 22, 2012 / Notices 10593 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3A Member is any registered broker or dealer that 

has been admitted to membership in the Exchange. 

4 In computer networking, multicast is the 

delivery of a message or information to a group of 

destination computers simultaneously in a single 

transmission from the source. Unicast transmission 

is the sending of messages to a single network 

destination identified by a unique address. For 

EdgeBook Cloud, the protocol used is relevant in 

that the message formats vary between the Unicast 

and Multicast disseminated feeds, and subscribers 

to the Service may want to download historical data 

in the same format currently used to receive the 

real-time market data feed. 

5There is no physical delivery associated with 

this particular EdgeBook Cloud Replay offering and, 

thus, no delivery charges will apply to it. 

6Although the size of the dataset can vary from 

day to day based on market activity, the average 

size per day is 3.5GB, and the data is then 

compressed to roughly 25% of that size, or .88GB, 

based on the compression technique chosen by the 

Purchaser. The compressed data size is used for 

evaluating appropriate fees. 

7There are no physical deliveries associated with 

any of the EdgeBook Cloud Snapshot offerings and, 

thus, no delivery charges will apply to them. 

8An API facilitates information sharing by acting 

as a ‘‘go-between’’ that enables a software program 

to interact with other software. 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66403; File No. SR–EDGA– 

2012–05] 

Self-Regulatory Organizations; EDGA 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Relating to an Offering of 

a New Historical Data Feed Service to 

Members and Non-Members 

February 15, 2012. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that, on February 

10, 2012, EDGA Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGA’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange is filing with the U.S. 

Securities and Exchange Commission 

(the ‘‘Commission’’) a proposed rule 

change to offer a new historical data 

feed service (the ‘‘Service’’) to 

Members 3 and non-Members of the 

Exchange. In connection with the same, 

the Exchange is proposing to amend its 

fee schedule applicable to Members and 

non-Members of the Exchange pursuant 

to Exchange Rules 15.1(a) and (c). The 

Exchange intends to implement the 

proposed rule change on February 13, 

2012. The text of the proposed rule 

change is available on the Exchange’s 

Web site at www.directedge.com, at the 

Exchange’s principal office, and at the 

Public Reference Room of the 

Commission. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of, and basis for, 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

self-regulatory organization has 

prepared summaries, set forth in 

Sections A, B and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to begin 

offering a new Service, namely 

EdgeBook Cloud, that will allow 

Members and non-Members of the 

Exchange (collectively, referred to as 

purchasers (‘‘Purchasers’’) to obtain and 

query historical trade and quote data 

(‘‘historical data’’) representing the realtime data feed previously disseminated 

through the EDGA Exchange book by 

the Exchange. The historical data 

service will provide Purchasers with 

data in a user-friendly, flexible manner 

for specified fees. Such Service will 

include the following three separate 

offerings: 

EdgeBook Cloud Replay 

The EdgeBook Cloud Replay offering 

will allow Members and non-Members 

of the Exchange to download a 

Multicast or Unicast 4 formatted replay 

of each trading day. The downloaded 

file will contain the exact messages that 

were disseminated via the Exchange 

book feed during the day requested, 

including any orders, executions, 

cancellations and status messages. 

Purchasers of the offering will be able to 

choose to obtain data grouped by 

different periods, including a rolling 

thirty day subscription or a calendar 

month request of as many months as 

desired. The initial launch of the service 

on February 13, 2012, will provide data 

from June 2011 until the present, with 

additional releases offered thereafter to 

provide data from October 2010 to the 

present. 

The Exchange is proposing to charge 

to Purchasers a fee of $500/month for 

the rolling thirty day replay 5 and, for a 

calendar month request, the Exchange is 

proposing to charge $500/month 

requested with a cap of $2500 if less 

than or equal to 1TB of data is 

requested. If a Purchaser requests more 

than 1TB of data, it will be charged an 

additional $2500 flat fee.6

EdgeBook Cloud FlexDownload 

Purchasers of the EdgeBook Cloud 

FlexDownload (‘‘FlexDownload’’) 

offering will be able to submit 

customized queries of trade or quote 

information for EDGA, and will be able 

to specify the time and symbol 

parameters, as well as other attributes to 

be retrieved. The requested data will be 

presented in a text file that can be easily 

imported into any tool for analysis. 

FlexDownload is a subscription-based 

offering that permits the Purchaser to 

choose a subscription level depending 

on the amount of data (in gigabytes) it 

estimates that it will download on a 

monthly basis. If a Purchaser downloads 

more data than is included in the 

subscription, an overage charge will be 

assessed for each additional gigabyte of 

data downloaded in that month. 

Specifically, the Exchange is 

proposing to charge $750/month for up 

to and including 200GB of data, $1500/ 

month for greater than 200GB of data 

but less than or equal to 800GB of data, 

and $2500/month for greater than 

800GB but less than or equal to 1TB of 

data. For the first two levels ($750 and 

$1500/month for FlexDownload), the 

Exchange is proposing to charge a 

$5/GB overage charge for any overage 

beyond paid subscription. For the third 

level ($2500/month), the Exchange is 

proposing to charge a $3/GB overage 

charge beyond the paid subscription 

level. 

EdgeBook Cloud Snapshot 

The EdgeBook Cloud Snapshot 

offering 7 will provide standard queries 

that can be accessed on-demand directly 

by a user, or through an Application 

Programming Interface (‘‘API’’) 8 that 

permits query results to be downloaded 

into a Purchaser’s database or displayed 

on their Web site. Standard queries 

include various quote and trade 

requests, as well as a combined quote 

and trade view for a requested symbol. 

The offering is subscription-based; the 

subscription level will be determined 


srobinson on DSK4SPTVN1PROD with NOTICES
10594 Federal Register / Vol. 77, No. 35 / Wednesday, February 22, 2012 / Notices 

9A Hit is defined as a query for a symbol/day. 

10An Activity Level is a multiplier that is related 

to the total quantity of quotes and trades, on the 

Exchange, of a given security relative to the 

quantity of quotes and trades of all other securities 

trading on the Exchange. Activity Levels are High 

(3), Medium (2), or Low (1), and are determined on 

a monthly basis pursuant to a review of the 

previous three month’s activity for the security. For 

a security to be considered Level 1, the combined 

quotes and trades on the Exchange must be less 

than .05% of the total quantity of quotes and trades 

on the Exchange for the calendar month. For a Level 

2 security, the combined quotes and trades on the 

Exchange must be greater than .05% and less than 

.25% of the total for the calendar month. Finally, 

for a Level 3 security, the combined quotes and 

trades on the Exchange must be greater than .25% 

of the total for the calendar month. The security 

Activity Levels for each of the three previous 

months are then averaged to create the final 

Activity Level multiplier for the security. Direct 

Edge will notify Purchasers in advance of any 

changes to the percentage bands. Activity Levels are 

posted on the EdgeBook Cloud Web site so 

Purchasers may determine their potential costs for 

requesting data prior to doing so. 

11See infra, footnote 14. 

12 15 U.S.C. 78f(b)(4). 

13The Exchange notes that this statement is in no 

way intended to relieve Purchasers of their 

obligations with respect to maintaining books and 

records pursuant to applicable securities laws. 14See Nasdaq Rule 7022. See also www.nyxdata.

com for information regarding NYSE OpenBook 

History and ArcaBook FTP, historical data products 

offered by the NYSE and NYSE Arca, respectively. 

See also Securities Exchange Act Release No. 55790 

(May 21, 2007), 72 FR 29565 (May 29, 2007) (SR– 

NASDAQ–2007–039). See also Securities Exchange 

Act Release No. 52112 (July 22, 2005), 70 FR 43917 

(July 29, 2005) (SR–NASD–2005–060). See also 

Securities Exchange Act Release No. 63351 (Nov. 

19, 2010), 75 FR 73140 (Nov. 29, 2010) (SR–Phlx– 

2011–154). See also Securities Exchange Act 

Release No. 61885 (Apr. 9, 2010), 75 FR 20018 (Apr. 

16, 2010) (SR–BATS–2010–002) (order approving 

proposed rule change to offer certain BATS 

Exchange Data Products). 

15 15 U.S.C. 78f(b)(5). 

based on the number of ‘‘Hits’’ 9 a 

Purchaser will use within the month. 

The number of Hits can increase based 

on the number of days or the Activity 

Level 10 of the security. The Activity 

Level is high, medium or low, based on 

the average quotes and trades per day 

(reviewed over a three month period), 

and relates to a multiplier that increases 

Hit quantity. For example, if a Purchaser 

queries a symbol for two days, the 

Purchaser would be charged for two 

days (or two Hits) multiplied by a high 

Activity Level of three, for a total of six 

Hits. If a Purchaser uses more Hits than 

subscribed to for two consecutive 

months, the Purchaser’s subscription 

will be automatically upgraded to the 

next level for the upcoming month. 

However, the Purchaser will be able, at 

any time, to request a downgrade or 

upgrade to any other subscription level. 

As described in the Exchange’s fee 

schedule, the Exchange is proposing to 

charge $100 per 500 Hits per month, 

$250/2,500 Hits per month, $500/10,000 

Hits/month, $750/50,000 Hits per 

month, and $1,000 per 250,000 Hits/ 

month. 

Historical data can be used to support 

many applications, including financial 

market research and analysis, backtesting of new trading strategies to gauge 

effectiveness, and quality control checks 

of changes to trading or data 

dissemination software. The Exchange 

proposes to make the Service readily 

available to its Members and nonMembers to download historical data 

through secure Internet connections. To 

compensate the Exchange for the costs 

of storage and data dissemination 

associated with providing the Service, 

the Exchange proposes to charge users 

monthly fees for the ability to download 

and query the historical data. The 

proposed fees vary based on the type of 

offering provided, as set forth in Exhibit 

5, and as described above. Furthermore, 

historical data can be retrieved in many 

forms, including an FTP download, a 

distribution to an Amazon S3 account 

or, for some of the subscription levels, 

a delivery of an external disk drive 

through postal mail and, if the 

Purchaser requests external disk drive 

delivery, it will be charged at cost for 

the media and the delivery charge. All 

such fees and costs relate to the 

provision of the Service offerings, i.e., 

the ability to query the historical data in 

the manners offered. The data itself 

remains available at no cost to Members 

and non-Members of the Exchange. 

Additional Discussion Regarding the 

Proposed Historical Data Services 

In adopting Regulation NMS, the 

Commission granted self-regulatory 

organizations (‘‘SROs’’) and brokerdealers increased authority and 

flexibility to offer new and unique 

market data services to the public. The 

Commission believed this authority 

would expand the amount of data 

available to consumers, and also spur 

innovation and competition for the 

provision of market data. EdgeBook 

Cloud appears to be precisely the sort of 

market data service that the Commission 

envisioned when it adopted Regulation 

NMS. The Service will offer Exchangespecific data in a new form not 

previously available to market data 

consumers, yet in a manner similar to 

that provided by other market centers.11

It will allow market participants to 

purchase a Service that may be used to 

query historical data from the Exchange 

while at the same time enabling the 

Exchange to better cover its 

infrastructure costs and to improve its 

market technology and services. Finally, 

EdgeBook Cloud will better enable 

market participants to conduct 

Exchange-specific analyses to meet their 

needs. 

The Exchange intends to implement 

the proposed rule change on February 

13, 2012. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the objectives of Section 6 of the Act in 

general and furthers the objectives of 

Section 6(b)(4) 12 in particular, as it is 

designed to provide for the equitable 

allocation of reasonable dues, fees and 

other charges among Members and nonMembers using its facilities. First, the 

Service is optional and fees charged for 

the Service will be the same for both 

Members and non-Members. Second, 

the Service will be provided in a variety 

of packages, including on an ongoing or 

an as-needed basis, intended to allow 

purchase of such access in the manner 

that best meets the needs of, and is most 

cost efficient for, the Purchaser. The fees 

reflect the differing offerings that any 

Purchaser may choose. In addition, 

higher fees are associated with 

increasing amounts of data (i.e., more 

gigabytes) requested by the Purchaser of 

the Service or more hits/month, 

depending on the Service, as described 

above, as increasing amounts of data 

requested require the Exchange to 

utilize more infrastructure/storage to 

accommodate the Purchaser’s requests. 

Further, to the extent subscribers do 

subscribe to/purchase the Service, they 

will avoid the costs of storing the data 

themselves.13 Third, the revenue 

generated by the Service will pay for the 

development, marketing, technical 

infrastructure and operating costs of an 

important tool for market participants 

and researchers to use for purposes of 

analysis and testing. Profits generated 

above these costs will help offset the 

costs that the Exchange incurs in 

operating and regulating a highly 

efficient and reliable platform for the 

trading of U.S. equities. This increased 

revenue stream will allow the Exchange 

to offer an innovative Service at a 

reasonable rate, consistent with other 

SROs who provide market data 

products.14

The Exchange also believes that the 

proposed fees are consistent with 

Section 6(b)(5) of the Act,15 which 

requires, among other things, that the 

Exchange’s rules not be designed to 

unfairly discriminate between 

customers, issuers, brokers or dealers. 

The Exchange believes that the fees 

proposed for the Service are equitable 

because the Service is purely optional 

and because the data itself can be 

obtained at no cost whether or not a 


srobinson on DSK4SPTVN1PROD with NOTICES
Federal Register / Vol. 77, No. 35 / Wednesday, February 22, 2012 / Notices 10595 

16On a daily basis, a real-time data feed is 

disseminated by the Exchange. Members and nonMembers of the Exchange can opt to gather such 

data and use it to create an historical record 

themselves rather than subscribe to the Service for 

the purpose of obtaining and querying historical 

data. 

17 15 U.S.C. 78s(b)(3)(A). 

18 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires the Exchange to give the 

Commission written notice of the Exchange’s intent 

to file the proposed rule change, along with a brief 

description and text of the proposed rule change, 

at least five business days prior to the date of filing 

of the proposed rule change, or such shorter time 

as designated by the Commission. The Exchange 

has satisfied the five-day prefiling requirement. 

19See supra note 14. 

20For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

21 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3A Member is any registered broker or dealer that 

has been admitted to membership in the Exchange. 

Member or non-Member subscribes to 

the Service.16 Purchase of the Service is 

not a prerequisite for participation on 

the Exchange, nor is membership to the 

Exchange a prerequisite to purchase of 

the Service. Only those Purchasers that 

deem the product to be of sufficient 

overall value and usefulness will 

purchase it. Moreover, the fees will 

apply uniformly to all Purchasers of the 

Service irrespective of whether the 

Purchaser is a Member of the Exchange. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The proposed rule change does not 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange has not solicited, and 

does not intend to solicit, comments on 

this proposed rule change. The 

Exchange has not received any 

unsolicited written comments from 

members or other interested parties. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not significantly affect the 

protection of investors or the public 

interest, does not impose any significant 

burden on competition, and, by its 

terms, does not become operative for 30 

days from the date on which it was 

filed, or such shorter time as the 

Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 17 and Rule 19b– 

4(f)(6) thereunder.18

The Exchange has requested that the 

Commission waive the 30-day operative 

delay. The Commission believes that 

waiver of the operative delay is 

consistent with the protection of 

investors and the public interest 

because the proposal will give 

Purchasers the ability to better organize 

and sort historical trade and quote data 

and is substantially similar to those of 

other exchanges.19 Further, waiver of 

the operative delay would provide 

access to historical trade and quote data 

without delay. Therefore, the 

Commission designates the proposal 

operative upon filing.20

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

EDGA–2012–05 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–EDGA–2012–05. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. All comments received will 

be posted without change; the 

Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–EDGA– 

2012–05 and should be submitted on or 

before March 14, 2012. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.21

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–4008 Filed 2–21–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66402; File No. SR–EDGX– 

2012–05] 

Self-Regulatory Organizations; EDGX 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Relating to an Offering of 

a New Historical Data Feed Service to 

Members and Non-Members 

February 15, 2012. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that, on February 

10, 2012, EDGX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGX’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange is filing with the U.S. 

Securities and Exchange Commission 

(the ‘‘Commission’’) a proposed rule 

change to offer a new historical data 

feed service (the ‘‘Service’’) to 

Members 3 and non-Members of the 


srobinson on DSK4SPTVN1PROD with NOTICES