Transparency???

We're off to a new year and hopefully some new and more positive attitudes towards transparency when it comes to disclosure of basic business entity information. Or perhaps not???

We've been working closely with a number of our clients over the years to verify information about firms registered in "secretive" jurisdictions (that does not mean that they leak by the way). Many of these tend to be in warm climates (although CNBC recently conducted a poll and found that the most secretive jurisdiction on the planet happens to be a little over an hour plane ride South East of Toronto where I'm writing this now - take a look http://www.cnbc.com/id/33591918/?slide=16).

The fundamental problem that we all face in trying to learn about companies we might like to transact with is that many of them incorporate in jurisdictions where they have no obligation to tell anyone else that they even exist. And if these firms don't have to publish anything about themselves, you as a financial institution or client simply need to trust what they tell you. Who's going to argue? Indeed this is one of the reasons that firms incorporate in such jurisdictions.

So the question is this. In such a huge, interconnected, leveraged and complex global economy, shouldn't we adopt some very basic yet universal standards around transparency if we are to minimize the chances or at least impact of another economic crisis? For example, shouldn't it be necessary for every registration authority in every jurisdiction to publish on a read only website, at no cost to the viewing public, the legal name and registered address of all entities registered in their jurisdiction? And shouldn't that registration authority (the one that typically has the legal mandate to prosecure the owners of a firm should they lie) also inform the public if each entity registered with them is active or not? Companies House sets a nice example of this in the UK. This information is also consolidated on Avox's www.wiki-data.com where it has been multiply sourced from various authorities.

This basic data serves as a kernel for a lot of other information however that core bit of data, if reliable and maintained in each jurisdiction by the authority with penalty inflicting power goes a long way to helping everyone converge on what is real, accurate and up to date. We call this Authoritative Source Convergence or "ASC". It's not an Avox product but a general initiative which we are working on with our clients, partners and a growing number of willing Authoritative Sources. This basic level of disclosure is vital for universal business entity identification (read "the holy grail").

Let us (and everyone else for that matter) know if you are interested in joining this initiative. We believe it can make all the difference.

Ken

FIMA London 2009

A busy week, last week. FIMA attendance was down a bit however we at least got back into the City. We missed attendees from Asia and Australia who participated last year however I suspect budget restrictions imposed in 08 had an impact on that.

It was a great pleasure for us to have Jeremy Ruston of Osmosoft spend a few minutes during the Avox presentation to give the audience insight into the power of open source software development. Jonathan Lister, an independent opensource software developer working with Avox pulled off the almost impossible by successfully demoing two live applications over the internet during the presentation (www.wiki-data.com and a custom app developed the night before using the wiki-data API - apps like these never work when you are doing live demos in front of large audiences!).

Thanks to all who joined the party at Prohibition on Tuesday night. The turnout was excellent (>200 people I'd say). Thanks to all the additional sponsors - Asset Control, EDM Council, Interactive Data, GoldenSource, S&P and SWIFT. The bash always makes our business a bit more tolerable.

Based on all the presentations, panel discussions and networking discussions last week, I see the potential for some substantial progress in the standardization and transparency around business entity data in 2010. Watch this blog over the next week or two. We've got some more things brewing.

Ken

NIF - Bark worse than Bite?

It's no secret that I've not been convinced of the "achievability" or desirability of the proposed regulatory infrastructure being proposed by the National Institute of Finance. But you know, I may be mellowing a bit. Here's why.

I bumped into an old business school/Algorithimcs alumni friend of mine in the Toronto airport on Tuesday (Dr. Dan Rosen - the brain with legs). He has been involved in NIF discussions over the past months and was actually the first person to tell me about it.

Well, I took the opportunity to suggest to Dan that NIF was behaving either arrogantly or naively or both. Dan gave me a kind but patronizing look and asserted the following.

"Ken, when the US government shut down Lehman but not AIG, they had no real understanding of whether that was the right move or not. They did not have anything to objectively measure what was the better decision." Crap, that's clear to me... "The objective of NIF is to help generate that understanding", Dan continued.

I immediately and quite cleverly (I thought) countered by shouting "Yes, but these guys are talking about splitting atoms, sending man to the moon and regulatory harmonization. The first two were easy!". Finally, I've managed to achieve some minimal sort of intellectual equity with the Ph.D. who was able to construct, graphically, Mick Jaggar's lips with a gamma graph on RiskWatch while drinking his cappucino and developing new credit risk management algorithms on his dirty napkin.

"Ken, Ken, Ken" (Dan's impatience starting to become evident), "these guys are politicians. They have to talk that way. All NIF wants to do is help increase transparency and provide better decision support.".

Now that makes sense to me. If the NIF folks start talking pragmatically and dump the atom splitting talk, I'm in . Forget about world peace, regulatory harmonization and poltical multi-partisanship. Transparency is the single most valuable objective we can shoot for.

And wouldn't you know it, the dark knight steps up to the plate. Bloomberg, are you serious?

The plot thickens...

Dazed and confused,

Ken

New version of wiki-data is live

I’m pleased to say that the new version of www.wiki-data.com is now live. There is also a link from our website.

Features of this new version:

- It has been developed in open source software which will provide significant flexibility to clients when the client specific version of the site is rolled out.

- Every Avox ID (AVID) is a distinct URI (Uniform Resource Identifier) enabling links to and from the entity record. There are no restrictions on the use of AVID, nor are there any license fees associated with it.

- We have put more data fields into this version of wiki-data including formerly known as name, also known as name, trading status, URL and additional operational address details.

- Users can hide/show columns, sort content in columns, click the AVID and land on a company page with a google map, filter content, challenge data values, request additional data for a record and request new records.

- Limited numbers of additional data and new record requests will be processed at no charge. We will soon have a charging mechanism in place for requesting more data and new records. Existing clients will be able to apply these requests against their existing contracts if they wish.

- There is a facility called “New app ideas” at the bottom of the screen where users can suggest and vote for new functionality.

- An email support function is also included at the bottom of the screen.

We have already started working on the client specific version of this application called “my-wiki-data” which will provide clients with more visualization, query and API functionality. We look forward to getting your feedback on both this public site and the client site as it evolves. Don’t hesitate to call if you have any questions. We hope that this new capability is helpful.

Please note that the email request function on the previous version of wiki-data was corrupted and not operational during the past two weeks. My apologies if you had tried to use that capability and received no response. It is working with this new version.

Democratization of Data (or not?)

I had an interesting conversation with someone who manages corporate customer data for a major investment bank last week. She said that she had read our blog and developed the impression that Avox was attempting to democratize entity data. In her opinion (and as it turns out, in mine), this alone is likely to degrade the overall quality level of the content.

After this discussion, it dawned on me that we had better be clear about our objectives at Avox, particularly as they relate to wiki-data.com:

1) Maximize the amount of productive "challenges" received that help us to improve quality of the data in wiki-data.com. Every challenge to records with an AVID will be verified by our expert team of analysts before being applied (assuming, of course, the challenge is proven correct). The "democratization" element of this activity equates to the opening up of a chunk of our content on wiki-data.com for the world to see and for anyone to challenge. BTW, the quality improvement benefits all our data vendor partner offerings too.

2) Provide a platform for others to link to and from. Our next release of wiki-data will incorporate additional identifiers from other firms. The AVID will be part of a URI for each entity enabling the technology community to efficiently leverage a single version of the truth. This will in turn attract more usage, more challenges, lower latency and increased accuracy.

3) Create a forum for anyone to comment on data records, propose changes in public and ultimately to add "non verified" data records which Avox or other firms can verify for clients. This is the big stretch and, if I'm honest, it's the iteration of wiki-data we are least certain about.

To be clear, Avox will never provide to clients data that has not been verified according to the terms of their service level agreements. We do however regularly get asked for large volumes of business entity data to facilitate marketing campaigns for example where data quality is not as important as it is for credit risk management or regulatory compliance. This is where information on millions of entities is sometimes required but the budget for procurement of this content is meager. Perhaps in these cases it is not necessary to have an independent and rigourous analysis performed on every entity at regular intervals and the community self checking mechanism is adequate. Moreover, a global community maintained model may be a great solution for a free and universal yellow pages capability (for example). Over time, more and more of these entities will be verified by expert third parties such as Avox and assigned identifiers as the market demands.

We don't have all the answers however our aim is to give you, the user community, a platform to access and use the content cheaply and efficiently. We are looking for your views and guideance on how to shape wiki-data.com to make it a more market friendly service that represents real value for you.

BTW, keep your eyes open for v1 of wiki-data.com later in September. You can check out Jonathan Lister's blog for progress - the software is opensource.

Ken

Wiki-data development with BT/Osmosoft

It's been a while since my last post but we have been busy working on wiki-data. Some of you will know that we have been in discussions with the open source software group at British Telecom. It's a subsidiary called Osmosoft comprised of some frighteningly clever technologists with impressive credentials and serious talent.

A group of us from Avox including senior management from our Wrexham office, our sales team including Brett Hodge who came over from Australia and myself spent a day with Osmosoft last week. They affectionately refer to these as "HackDays".

Within the space of 10 hours, this team, led by Jeremy Ruston, the Osmosoft founder, put together a brand new (I mean built from scratch) version of wiki-data with some great interactive functionality. We provided the guys with a very large dataset which they used as a base. By the end of the day, we had a platform where every AVID had its own URI (uniform resource identifier) so that anyone can link to or from it, addresses of companies are now linked to Google Maps so you can visualize where firms are based (we quickly found one in Iraq!), anyone can begin a comment string on an entity and yes, we even had an online edit function (we are going to need to figure out how to govern that one before releasing it!).

If you are interested, your best bet is to have a look at Michael Mahemoff's blog where you will find detailed descriptions of the process and outcome as well as a video of me and Paul Downey of Osmosoft running you through the platform before we ran to the pub for pints. Just click on the link (embedded in the heading) at the top of this post.

Or if you prefer: http://softwareas.com/wikidata-hackathon-wikidata-a-wiki-of-companies-data.

I'll keep you posted on what will be rolling out and when. We are extremely excited.

Ken

Who's Got the Entity Data Standard?

It's been an interesting month with many articles and editorials in publications such as Reference Data Review, Inside Reference Data, Global Investment Technology and Securities Industry News to name a few all raising the issue of standards in the business entity data space. There is no shortage of contenders. SIIA is pushing IGI (Issuer, Guarantor ID). SWIFT is considering a role by expanding BIC coverage and addressing the non-uniqueness of the BIC. Factset has made past announcements of their intention to make a public standard available. Other major data vendors such as Bloomberg, ThomsonReuters and D&B already have broad coverage. The European Central Bank is working on a data utility. So is Financial Intergroup's Allan Grody. And so is the Dubai International Financial Centre (DIFC). Avox has an initiative S&P called the CABRE (Cusip, Avox Business Reference Entity). We've also recently launched a free business entity directory (www.wiki-data.com). And of course there are the industry working groups including the EDM Council, JWG-IT and FISD all talking about standards.

This is all looking pretty positive, isn't it??? (NOT!!!).

Let's be honest here. Every commercial firm in this space would love to own the global standard for business entity identification. Think about it. The entire planet "theoretically" would have to pay you and only you for the right to get an authoritative picture of a business entity. Just think of the monopoly play here. Millions of customers needing millions of pieces of information every day. One year's profit would pay off the US national debt.

At least that's what many buyers of such information believe. It's not quite that profitable a picture. Here's why.

There can never be a monopoly provider of this data. The function that all of the above mentioned firms play is that of data aggregator. Some firms use automated matching to provide a consolidated picture, some use manual analysis and all the others a combination of both. The sources we go to are the same that anybody can go to directly.

The sources used typically include national and state business registries, regulatory authorities and tax authorities. All these organizations have an obligation to make information available to the public (although some of them have decided to put a rather hefty price tag on some important data). Some data is not publicly available and various vendors have secured rights to it but by an large, nobody had universal access to everything (the Google guys are trying...).

So where is all this spaghetti going to get us? In my opinion, it's going to get us to where you want to go. Competitive forces are pushing all vendors to be more innovative, cost effective and customer focused. A perfect world in the Avox view is one where everyone works off of the same underlying basic content that uniquely identifies a business entity. The ID becomes a secondary issue but remains important of course.

Some vendors are working to this objective. You won't be shocked to hear that Avox is one of them however a number of firms we have spoken to are also "chilling out" with respect to relinquishing value of the basic data.

Please believe me when I say that Avox does not expect to be able to solve the whole problem on our own when it comes to business entity identification. We can't. But we can help facilitate a quicker convergence onto a standard by being open and "influencing" other firms to be open.

If you buy into this view, let your vendor partners know. The sooner we connect, the sooner you can connect and that's when everyone can get on with the business of efficiently generating returns for customers.

Your Data Geek,

Ken