Traders Might Suffer Latency Due to PrimeXM/CNS Fee Dispute
Clients who use MT4 VPS by brokers such as FXCM Mena, Forex.com (UK) and LMAX may face slower connectivity on
Forex Magnates has learned that the CEO of Commercial Network Services (CNS), Barry Bahrami, has contacted a number of FX brokers to inform them that a fee dispute between the Virtual Private Server (VPS) provider and PrimeXM might lead to additional latency for their clients’ VPS.
PrimeXM supplies FX brokers with an aggregation engine and access to liquidity providers. Some broker’s MT4 servers are located at PrimeXM and CNS provides the hosted virtual desktops for the traders. PrimeXM has been directly connected to the CNS network in New York and the U.K, on a service called “ON NET”.
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ON NET is a close proximity connection that provides the ability for traders to host their VPS on the same data location as their brokers, thus enabling <1MS latency. The offering is popular among EA traders wishing to ensure their orders are sent to brokers ahead of other customers using similar strategies.
Typically, the cost of connecting each network in a mutually beneficial peering arrangement is split down the middle (the data center charges a fee). However, according to Mr. Bahrami, instead of splitting the monthly cost for the PrimeXM x-connects in NY and UK, CNS has been paying the full fee as a courtesy from the start.
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About a day ago, CNS were notified by PrimeXM that they intend to charge a flat monthly fee to all external hosting providers that utilize PrimeXM’s network as of July 1st. This does not include the cross connect fee. CNS believes that any fee to PrimeXM is unreasonable, given the great mutual benefits it claims the ON NET connectivity provides.
Mr. Bahrami warned that unless PrimeXM changes their position, ON NET connectivity to these brokers will be terminated on August 1st. Traders utilizing these brokers will still be able to connect to their broker, however latency is expected to increase to somewhere between 1-1.5ms. He further cautioned: ” PrimeXM has threatened to cut the x-connects this coming weekend, but are now setting the date as August 1.”
According to the company’s online records some of these brokers include; ADS Securities, Armada Markets, Bank Direct FX, Benchmark Group, Blackwell, DCFX, Divisa Capital, Ethos, FinFX, Finotec, ForexFS, FXCM Mena, Forex.com (UK), GoMarkets, LMAX, Sensus Captial Markets, Synergy FX and Traders Trust.
CNS urged the brokers involved to contact PrimeXM to protest their fee hike “as the brokers are PrimeXM customers and are in the best position to make PrimeXM understand the errors in their decision.”
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Not having the ON NET connection will increase the latency by a whopping 1-2ms, mainly because CNS will already have other nearby connections. The only people who might be affected by the latency would be High Frequency Traders who need ms/ns co-location connection speeds. So basically 99% of the retail forex community should be unaffected. Another drawback is that ON NET provided direct connection in such a way as to bypass normal internet connection. So if the normal internet were to have problems, it could possibly result in more latency. This is very unlikely though due to the redundancies of… Read more »
I general I would never do business with CNS after this
Any guy that is that cheap and under handed to resort to press on this I would have a hard time trusting
As a client of CNS I find their attitude hugely disappointing.
Primexm is offering them access to an elite bouquet of Forex Brokers.
They should stop behaving like a little brat by using their clients to conduct unfair bullying and work with Primexm on reasonable business terms.
I see On Net as a Marketing Factor for CNS. Hey Traders, we do have super quick lines…
But in practice 1 or 2 ms +/- Latency does have no effect, especially trading on MT4.
I’m interested to know what the $$ fees were that seemed to cause such a ruckus.