US Labor Dpt Changing Data Reporting Rules

It was in that month that Senior Labor Department Adviser for Communications Carl Fillichio discovered that two major news services had installed fiber optic circuits into the room used for the data lockups despite a well-advertised department prohibition of the super-fast data lines, which are milliseconds faster than copper-based circuits.

"Unfortunately, it has come to my attention that, contrary to this ban, certain organizations have installed unauthorized fiber technologies," Fillichio then wrote to all the news media participating in the lockups. "Such lines must be removed no later than Friday, August 27 (2010)." They were removed, but subsequently he found a third firm appeared to him to be attempting to do the same thing.

The offending fiber optic circuits were disabled and removed from Labor Department premises, yet the episode may have left lasting scars and apparently was interpreted by Fillichio and others at the Department as a breach of trust.

Some reporters working in the lockup room for the news services involved said they were not aware of any fiber optic installations, that if there were any, they were apparently done by their technical departments in an effort to gain a speed advantage without the reporters' knowledge. Others attributed the errant installations to misunderstandings between the Department and news service technicians.

Even after the fiber optic circuits were removed, the Department apparently began considering whether a new security upgrade was needed that could control algo feeds and their special high-speed technologies that were outside the expertise of anyone on the department's technical staff.

The Labor Department had no comment on this scenario, nor on any aspect of the coming changes.

But last month CNBC reporter Eamon Javers reported the Labor Department had hired Sandia Laboratories to analyze data lockup security, including data circuit installations. Sandia is one of the contractors which provide high-priority security services to government, including to some nuclear production and storage facilities.

The Labor Department later confirmed the CNBC story to MNI, but said no particular incident triggered the in-depth security analysis.

The vendors of such "algo" services include Bloomberg, Thomson-Reuters, Thomson-IFR, Dow Jones, The Bond Buyer and Need to Know News, owned by MNI, which in turn is owned by Deutsche Boerse, the Frankfurt equivalent to the New York Stock Exchange.

Typically only the top set of headline numbers from any report, such as the change in payrolls in the jobs report, the unemployment rate and important revisions, are included in an algo feed. There is no accompanying text or commentary or words of any kind. At the customers' end, the raw numbers are used by trading computers within thousandths of a second, having been programmed ahead of time how to react to various possible outcomes.

The difficulties the new Labor Department dissemination process might pose for algo feeds were not brought up April 16 by Department officials or the news media representatives when Fillichio hosted a teleconference to discuss the rule changes.