Nanex's data is based on the SIP CTA/CQS-UTDF/UQDF feeds, which means that their timestamps are fundamentally inaccurate. This voids almost all of their research. Here's an example where their timestamps are obviously inaccurate: Nanex ~ 20-Sep-2013 ~ Einstein and The Great Fed Robbery To compare, here's my data on that day with timestamps in NJ. 

 
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News.Story|34151|8742656|MTC0ER0PLGKI|ORIGINAL|ADD_STORY|25|BFW|ENGLISH|20130918 14:00:00.000226537|0|*FED: END-2013 JOBLESS RATE AT 7.1%-7.3% VS 7.2%-7.3% IN JUNE|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,COMPANY,COMPANY,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|BFWFX,BFWRATE,BGOVBILLGO,BIZNEWS,BNK,BON,BONDWIRES,BUSINESS,CBRATES,CECO,CEN,COS,ECO,EQUITYKEY,FED,FIN,FINNEWS,FLASHG7,FRX,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,INF,MARKETS,MMK,MONETARY,MSCINAMER,MSCIWORLD,NORTHAM,RIF,SRCRANK1,UNEMPLOY,US,USECO,USGOV,1867829,%USD,%USD,AGRKEY,BGOVCODES,CMDGLOMAC,CMDKEY,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,ESG,ESGCOUNT,ESGLABOR,ESGRES,ESGSOC,FIALL,FIASST,FIRSTWORD,G10MEMB,G7MEMB,G8,GEN,INDUSTRIES,LABOR,METALKEY,MISC,NRGKEY,OILKEY,POLIRISK,RATESKEY,SPREGIONS,WORLD|100,70,100,100,70,70,100,100,100,70,99,70,100,100,99,70,100,99,100,100,70,70,97,70,100,100,70,100,70,98,100,100,70,100,100,96,70,70,100,70,96,95,99,100,99,99,100,100,99,99,96,96,96,96,96,100,100,70,70,70,99,100,91,96,99,100,99,99,100,100,100,100||
News.Story|34151|8742656|MTC0ER0PLGKK|ORIGINAL|ADD_STORY|25|BN|ENGLISH|20130918 14:00:00.001183390|0|*FED: END-2014 JOBLESS RATE AT 6.4%-6.8% VS 6.5%-6.8% IN JUNE|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,COMPANY,COMPANY,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|BGOVBILLGO,BIZNEWS,BNK,BON,BONDWIRES,BUSINESS,CBRATES,CECO,CEN,COS,ECO,EQUITYKEY,FED,FIN,FINNEWS,FLASHG7,FRX,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,INF,MARKETS,MMK,MONETARY,MSCINAMER,MSCIWORLD,NORTHAM,RIF,SRCRANK1,UNEMPLOY,US,USECO,USGOV,1867829,%USD,%USD,AGRKEY,BGOVCODES,CMDGLOMAC,CMDKEY,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,ESG,ESGCOUNT,ESGLABOR,ESGRES,ESGSOC,FIALL,FIASST,G10MEMB,G7MEMB,G8,GEN,INDUSTRIES,LABOR,METALKEY,MISC,NRGKEY,OILKEY,POLIRISK,RATESKEY,RUNEWS,SPREGIONS,WORLD|100,100,70,70,100,100,100,70,99,70,100,100,99,70,100,99,100,100,70,70,97,70,100,100,70,100,70,98,100,100,70,100,100,96,70,70,100,70,96,95,99,100,99,99,100,100,99,99,96,96,96,96,96,100,100,70,70,99,100,91,96,99,100,99,99,100,100,100,100,100||
News.Story|34151|8742656|MTC0ER0PLGKN|ORIGINAL|ADD_STORY|25|BN|ENGLISH|20130918 14:00:00.002086229|0|*FED: END-2015 JOBLESS RATE AT 5.9%-6.2% VS 5.8%-6.2% IN JUNE|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,COMPANY,COMPANY,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|BGOVBILLGO,BIZNEWS,BNK,BON,BONDWIRES,BUSINESS,CBRATES,CECO,CEN,COS,ECO,EQUITYKEY,FED,FIN,FINNEWS,FLASHG7,FRX,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,INF,MARKETS,MMK,MONETARY,MSCINAMER,MSCIWORLD,NORTHAM,RIF,SRCRANK1,UNEMPLOY,US,USECO,USGOV,1867829,%USD,%USD,AGRKEY,BGOVCODES,CMDGLOMAC,CMDKEY,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,ESG,ESGCOUNT,ESGLABOR,ESGRES,ESGSOC,FIALL,FIASST,G10MEMB,G7MEMB,G8,GEN,INDUSTRIES,LABOR,METALKEY,MISC,NRGKEY,OILKEY,POLIRISK,RATESKEY,RUNEWS,SPREGIONS,WORLD|100,100,70,70,100,100,100,70,99,70,100,100,99,70,100,99,100,100,70,70,97,70,100,100,70,100,70,98,100,100,70,100,100,96,70,70,100,70,96,95,99,100,99,99,100,100,99,99,96,96,96,96,96,100,100,70,70,99,100,91,96,99,100,99,99,100,100,100,100,100||
News.Story|34151|8742656|MTC0ER0PLGL2|ORIGINAL|ADD_STORY|25|BN|ENGLISH|20130918 14:00:00.006318805|0|*FED: 2013 PCE INFLATION OF 1.1%-1.2% VS 0.8%-1.2% IN JUNE|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,COMPANY,COMPANY,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|BGOVBILLGO,BIZNEWS,BNK,BON,BONDWIRES,BUSINESS,CECO,CEN,COS,ECO,EQUITYKEY,FED,FIN,FINNEWS,FLASHG7,FRX,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,INF,MARKETS,MMK,MSCINAMER,MSCIWORLD,NORTHAM,RIF,SRCRANK1,US,USECO,USGOV,1867829,%USD,%USD,AGRKEY,BGOVCODES,CMDGLOMAC,CMDKEY,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,FIALL,FIASST,G10MEMB,G7MEMB,G8,GEN,INDUSTRIES,METALKEY,MISC,NRGKEY,OILKEY,POLIRISK,RATESKEY,RUNEWS,SPREGIONS,WORLD|100,100,70,70,100,100,70,99,70,100,100,99,70,100,99,100,100,70,70,97,70,100,100,100,100,70,100,100,70,100,100,70,70,100,70,96,95,99,100,99,99,100,100,100,100,100,100,70,70,99,100,91,99,100,99,99,100,100,100,100,100||
News.Story|34151|8742656|MTC0HK0PLGMA|ORIGINAL|ADD_STORY|25|BN|ENGLISH|20130918 14:00:00.009225881|0|*FED FORECASTS 2016 GDP GROWTH OF 2.5%-3.3%|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,COMPANY,COMPANY,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|BGOVBILLGO,BIZNEWS,BNK,BON,BONDWIRES,BUSINESS,CECO,CEN,COS,ECO,EQUITYKEY,FED,FIN,FINNEWS,FLASHG7,FRX,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,INF,MARKETS,MMK,MSCINAMER,MSCIWORLD,NORTHAM,RIF,SRCRANK1,US,USECO,USGOV,1867829,%USD,%USD,AGRKEY,BGOVCODES,CMDGLOMAC,CMDKEY,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,FIALL,FIASST,G10MEMB,G7MEMB,G8,GEN,INDUSTRIES,METALKEY,MISC,NRGKEY,OILKEY,POLIRISK,RATESKEY,RUNEWS,SPREGIONS,WORLD|100,100,70,70,100,100,70,99,70,100,100,99,70,100,99,100,100,70,70,97,70,100,100,70,100,70,100,100,70,100,100,70,70,100,70,96,95,99,100,99,99,100,100,70,70,100,100,70,70,99,100,91,99,100,99,99,100,100,100,100,100||
News.Story|34151|8742656|MTC2003TCF0H|ORIGINAL|ADD_STORY|25|BN|ENGLISH|20130918 14:00:00.529130774|1|*FED WANTS `MORE EVIDENCE' OF GROWTH PROGRESS BEFORE TAPERING|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|ALLHOT,BB,BFWFX,BFWRATE,BGOVBILLGO,BIZNEWS,BON,BONDWIRES,BRNEWS,BUSINESS,CECO,CEN,CMDGLOMAC,ECO,EQUITYKEY,FED,FINMIN,FINNEWS,FLASHG7,FOMC,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,HOT,INF,LABOR,MAJOR,MARKETS,MSCINAMER,MSCIWORLD,MTGEKEY,NORTHAM,SRCRANK1,TIMECO,TIMENI,TOP,TRE,US,USECO,USGOV,UST,7372630,AGRKEY,BGOVCODES,CBM,CMDKEY,COS,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,ESG,ESGCOUNT,ESGLABOR,ESGRES,ESGSOC,FIALL,FIASST,FIRSTWORD,FISUB,G10MEMB,G7MEMB,G8,GEN,METALKEY,MISC,NOB,NRGKEY,OILKEY,POLIRISK,RATESKEY,RUNEWS,SPREGIONS,USB,WORLD|100,100,100,70,100,100,70,100,100,100,70,99,100,70,100,99,70,100,99,70,100,70,70,100,70,100,100,100,70,70,100,100,100,100,100,70,100,100,100,100,70,70,70,100,70,70,100,100,70,100,70,100,100,70,70,70,70,70,70,70,100,100,70,70,70,70,99,100,100,100,70,100,100,100,100,100,100,70,100||
News.Story|34151|8742656|MTC22R6TTDSP|ORIGINAL|ADD_STORY|2345|BFW|ENGLISH|20130918 14:01:39.232043369|0|*FED REFRAINS FROM QE TAPER, KEEPS MONTHLY BUYING AT $85 BLN|PLAIN|||<<excluded at user request>>|||TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,PERSON,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC,TOPIC|BFWAS,BFWCRDAS,BFWCRDEU,BFWCRDUS,BFWCRED,BFWEU,BFWFX,BFWMORUS,BFWRATE,BFWRTAS,BFWRTEU,BFWRTUS,BFWUS,BGOVBILLGO,BIZNEWS,BON,BONDWIRES,BUSINESS,CBRATES,CECO,CEN,CMDGLOMAC,ECO,EQUITYKEY,FED,FINMIN,FINNEWS,FLASHG7,FOMC,FXKEY,G7ECOS,GBN,GLOBALMACR,GOV,GOVMISC,HEADS,INF,LABOR,MARKETS,MONETARY,MSCINAMER,MSCIWORLD,NORTHAM,SRCRANK1,TRE,US,USECO,USGOV,UST,16339176,AGRKEY,BGOVCODES,CBM,CMDKEY,COS,CREDITKEY,DEBTKEY,ECOINDIC,ECOSTAT,ESG,ESGCOUNT,ESGLABOR,ESGRES,ESGSOC,FIALL,FIASST,FIRSTWORD,FISUB,G10MEMB,G7MEMB,G8,GEN,METALKEY,MISC,MTGEKEY,NOB,NRGKEY,OILKEY,POLIRISK,RATESKEY,RUNEWS,SPREGIONS,USB,WORLD|100,100,100,100,100,100,100,100,70,70,70,70,100,100,100,70,100,100,100,70,99,100,70,100,100,70,100,99,70,100,70,70,100,70,100,100,70,70,100,98,100,100,70,100,70,70,70,100,70,70,100,100,70,100,70,100,100,70,70,70,70,70,70,70,100,100,100,70,70,70,99,100,100,100,100,70,100,100,100,100,100,100,70,100||
1. Nanex's data is incorrectly timestamped at 14:00:00.001, giving them the impression that it takes 1 millisecond for the data to reach NJ from DC. Observe that I received the news at 14:00:00.000226537, within 227 microseconds of the release. If the same quality of delivery is used, it's possible to receive the same packet in Chicago in under 1.6 milliseconds after I receive it in NJ, not 5 milliseconds as Nanex claims.

2. None of the legitimate electronic traders had early access to the news. Observe that the only thing I knew in time to react to the move was "*FED: END-2013 JOBLESS RATE AT 7.1%-7.3% VS 7.2%-7.3% IN JUNE". The "secret sauce" is in the mathematical models that I have to make sense of this. I deliberately hid the fields that matter, but I left enough fields in the data to show that it's not magic or insider information, but hard-earned research.

There's no speed advantage from the data feed whatsoever - even if I shared my data feed with everyone else in the public, 99.999% of them would only have reacted to "*FED WANTS `MORE EVIDENCE' OF GROWTH PROGRESS BEFORE TAPERING", timestamped at 14:00:00.529130774, an entire 529 milliseconds after the scheduled announcement.

Eric's recommendations in Flash Crash Analysis - May 6'th 2010 - Part 1 - Empirical Analysis - Answers - Nanex and Nanex - Flash Crash Analysis - Flash Crash Summary are uninformed.

Regarding his first suggestion, it's fundamentally impossible for the public feed to display the timestamp simultaneously as the match takes place with the present exchange architecture. I think he has some vague idea that they should eliminate the round trip on the order channel, which has unintended latency consequences that we waste a lot of time solving. I agree that this is a good idea as it would make for a simpler API to develop against, and therefore reduce latencies and improve the market quality across in general. I feel, however, that Eric's motive for suggesting this is so that data vendors do not have to pay that extra $28,550 per month for exchange licenses; I doubt this will achieve the intended goal, as the license fees for the SIP feeds will undoubtedly increase if unchecked. You can do this and make the SIP feeds free too - but that will become a cost on taxpayer money. You can't have the best of all worlds.

Regarding his second suggestion, sure, I absolutely agree. But whoever's under the impression that this will reduce public costs is gravely mistaken. The growing bandwidth requirement is a function of several factors, a few are good reasons, and a few (such as liquidity rebates, and this), are bad.