Last week Liffe, London's financial futures exchange and the third biggest in the world, delivered a hammer blow by deciding against joining Globex. The exchange felt that membership of Globex would have prevented it from expanding its own trading system.
Liffe's decision was the second major setback for Globex, which was developed at great cost by Reuters but has yet to live up to initial expectations.
The future of the system was first thrown into doubt last month when the Chicago Board of Trade, the world's biggest futures exchange and one of Globex's original supporters, decided to pull out. Not surprisingly, Reuters subsequently pinned its hopes on Liffe. But that bid also failed after Liffe found the terms too restrictive.
So far only Matif, the French exchange, and the Chicago Mercantile Exchange, a much smaller counterpart to the Chicago Board of Trade, use Globex. Although Reuters won a significant victory by clinching DTB, the German exchange, last week, it still faces a tough battle to turn the loss- making venture into a success.
Globex is one of the new generation of financial products on which many believe Reuters' long-term growth depends. It was launched in mid- 1992 to provide an after-hours electronic screen-based system for trading futures and options.
The hope was it would win subscribers from the world's important futures markets, creating a round-the-clock trading facility spanning the globe.
The system enables dealers to see best prices for futures contracts and to trade on screen. In return, the company receives a monthly rent per terminal and a fee per transaction.
But with the Chicago Board of Trade and Liffe turning their backs, the system has made slow progress in winning backers - so far about 350 terminals have been installed, compared with a potential market of thousands. This is partly because after-hours trading has not been as popular as expected, with trading volumes lower than hoped for.
Brian Rusling, an analyst with Yamaichi International, the Japanese securities firm, estimates that Globex's revenues could increase by about half to pounds 15m this year. But it will have to grow rapidly for several years before revenues make an impact on Reuters' overall pre-tax profits, expected to top pounds 500m this year.
'Globex is a revolutionary idea and these things take a long time to develop. The company has said that Globex will eventually make a significant contribution to its revenues, but to do that revenues would have to rise to between pounds 150m and pounds 200m a year,' he said.
Meanwhile, Globex faces growing competition. Both the Chicago Board of Trade and Liffe are planning to enhance their own systems and extend after-hours trading on their existing systems.
Liffe and the Tokyo International Financial Futures Exchange are also in talks to link some of their trading activities.
In the US, the Chicago Board of Trade is negotiating an alliance with Bloomberg Financial Markets, a rival to Reuters, to trade its financial contracts on Bloomberg terminals after hours.
But despite the recent setbacks, Reuters is putting on a brave face and hopes to win customers elsewhere, particularly in the Far East.
'We are in discussions with several exchanges and hope to win backing from Singapore next quarter,' a spokesman said.
'The prospects for Globex are still good, though it can take a lot of time to build a high level of liquidity on the system,' he admitted.
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