Digital publishing and distribution has fundamentally changed this market. Both the books and the shelves are now electronic. Authors can now format books for e-readers in a couple of hours. Sales platforms like Amazon Kindle Direct give access to a worldwide audience with essentially no upfront costs. Supply can close to perfectly match demand as the marginal cost of creating and delivering an eBook is effectively zero. This digital revolution has caused barriers to entry to plummet while simultaneously raising returns to author entry: they now receive as much as 85% of the royalties from an eBook, compared to as little as 10% from a physical book. Previously unpublished authors now sell millions of books. The incumbent middle men – book publishers, distributors and retailers – have found their lunch devoured in one sitting. In effect, they have been disintermediated by technology and (in a delicious irony) a common language. This pattern has been replicated in the music industry. For half a century or more, the music supply chain was unchanged. New acts were discovered by large record labels who distributed physical goods (vinyl, tapes or CDs) to retailers for sale to the public. Over the past decade, the costs of copying and distributing music have fallen to close to zero. As in publishing, barriers to new artist entry have plummeted. The middle-men – music production companies and distributors – have seen their piece of the pie eaten. And as a direct result of this industrial transformation, the pie itself appears to have grown.

Meanwhile, PIs are the adjectives of this new vocabulary, describing the elements of each financial transaction. Together, LEI-nouns and PI-adjectives are key building blocks of a new common financial language. LEIs and PIs have natural counterparts in the world of product supply chains. For LEIs read GLNs – the Global Location Numbers that uniquely define nodes in the global supply chain. GLNs are ultra-flexible. They can denote something as macro as a Wal-Mart warehouse or as micro as a specific shelf in a Wal-Mart store. They provide the co-ordinates of a high-definition map of the global supply chain. For PIs read GTINs (Global Trade Identification Numbers) and the GDSN (Global Data Synchronisation Network). Together, these identifiers define not only products (such as toothpaste) but their attributes (the dimensions of the box the toothpaste is stored in). They too are ultra-flexible. These identifiers define the DNA string for everything from chocolate wafers to collateral swaps. LEIs and PIs are being cast from a similar mould to GLNs and GTINs. International efforts so far have focussed on global LEIs. These are means of capturing, in a common data string, the old banking maxim of “know your counterparty”. In today’s financially interconnected world, knowing your counterparty may be insufficient. So global LEIs aim to barcode counterparty linkages at any order of dimensionality. In November 2010, the OFR issued a policy statement on LEIs.29 This kicked-off an industry process, led by the Securities Industry and Financial Markets Association (SIFMA), aimed at settling on a single, industry-wide entity identification standard.