Unfavourable market conditions and a dearth in big mergers, acquisitions and flotations has forced City institutions to find cost reductions beyond large lay-offs and frozen bonuses. And the biggest winners are smaller companies with an affordable choice of financial data vendors.

One area for savings is the cost of financial news, market data and analysis. Institutions looking for savings mean the new suppliers to this market have finally managed to get a toe in the door.

The market data industry comprises four sectors - equities, fixed income, foreign exchange and commodities, plus three user sectors - trading, investment and retail. There is no one global leader in all the sectors, Reuters lead foreign exchange, Bloomberg fixed income and ILX equities.

Bridge Information Systems went bankrupt last year during a period of technology consolidation among financial services firms and a trend toward fragmentation in the financial services marketplace. The bankruptcy led to a major reshaping of the industry. As a result Reuters, Bloomberg and Thomson Financial are attempting to strengthen their position.

Over the last couple of years the net has come of age. It is now secure and reliable. In particular, the advent of application service provision technologies means users can interact with fast and powerful software applications which run elsewhere across the net - making them more robust, secure, reliable and cost-effective.

New providers are offering comparable market data solutions to a wider range of businesses at a fraction of past costs.

Traditional strategy holds that the only way to tackle markets dominated by major players is via niche markets but technology has changed the rules of the game making premium financial information more accessible.