KX Systems JA Redacted.pdf

FAR 13.501(a) Sole source acquisitions.

5. Demonstration that the proposed contractor’s unique qualifications or the nature of the acquisition requires use of the authority cited.

KX Systems is the primary developer and copyright owner of a financial time series database and platform known as “KDB+” based upon the “K” software, originally developed by Arthur Whitney for Morgan Stanley and spun off in 1993. K is an APL-based vector programming language, with “KDB+” being the binary format with which K saves tabular data as a database.

The “q” language is the 4th iteration of the KDB+ language with a somewhat simplified syntax.

KDB+, which uses the Q language, is an industry standard for saving time series financial data in a columnar format, and was designed to accelerate queries in a situation where disk space, networking, and multi-processor availability is limited. KDB+ can efficiently sweep billions of rows of data in seconds.

Since 2015, the SEC has used multiple versions of the Q software, database, and language (from

3.2 up to 4.). The SEC stores approximately 300 TB of market and Registrant data in KDB+. Q is used by developers, examiners, and quantitative consultants to ingest datasets of up to100 Billion lines in size to do analyses related to customer execution quality, trade data and other analytics.

The SEC has a need for software to replace the functionality of the KDB+ software currently in use. The software must have the capability to meet the SEC’s need for reading extremely large cold CSVs and other archival data and to allow modifications and corrections to this data, to allow joining of market data, and to allow a sorted, partitioned, optimized result to be stored to disk, so that later analytics can quickly retrieve data relevant to analytics questions asked by Exam review. Moreover, the software must work effectively with existing SEC code base and avoid the need for redevelopment, conversion, and data migration.

Only Insights Data Enablement Pack can ingest, process and store extremely large datasets accurately and efficiently to meet the SEC’s requirements. Insights Data Enablement Pack has the unique capability to meet the SEC’s need for reading extremely large cold CSVs and other archival data, and includes the ability for required modifications and corrections to this data, to allow joining of market data, and to allow a sorted, partitioned, optimized result to be stored to disk to be retrieved later for further analytics. Furthermore, use of Insights Data Enablement Pack software will eliminate the need for extensive code base redevelopment as well as the conversion, and possibly data migration, of the existing data in using another solution that does not fully-satisfy the SEC’s requirements. Specifically, the complex code baseline rewrites could lead to functional issues within the applications, impact operability (uptime) and result in an inability to perform timely data analytics that are critical to examinations, and take an estimated two years to fully redevelop and convert the existing data leading to an unacceptable gap in mission critical support to the SEC.

KX Systems Inc. does not currently utilize any distributors or resellers, so Insights Data Enablement Pack software can only be purchased as a sole source directly from KX Systems Inc.

6. Efforts to ensure that offers are solicited from as many potential sources as possible.

In accordance with FAR 5.203(a), a special notice to award a sole-source contract to KX Systems Inc for Insights Data Enablement Pack Software was posted. No vendor indicated interest to the special notice.

7. Determination by the Contracting Officer that the anticipated cost to the Government will be fair and reasonable.

The Contracting Officer determines that the cost to the Government will be fair and reasonable.

The proposed methods to determine whether pricing is fair and reasonable may include, but need not be limited to, the proposal analysis techniques in accordance with FAR 13.106-3(a)(2).

8. Description of the market research conducted and results or statement of the reasons market research was not conducted.

Other database software or other alternatives to database software, such as Shakti, Spark, ORC, HDF5, Postgres, Pandas, Dask, were researched between 2021-2022, including options available as cloud only-versions (such as Presto SQL). The SEC found that all of these alternative technologies would require substantial rewrites of major code bases and/or reloading of all previous data, in addition to big data migration. In addition, the cloud migration for EXAMS analytic work has not progressed sufficiently to permit full scale shift to the cloud. Thus it has not been possible to demonstrate that any other technology can operate at the scale which Insight Data Enablement Pack software (KDB+) provides to the existing projects which EXAMS must support.

9. Other supporting facts.

None.

10. A listing of the sources, if any, that expressed in writing an interest in the acquisition.

The only source that expressed an interest in this acquisition is KX Systems Inc.

11. A statement of the actions, if any, the SEC may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required.

The Commission’s information requirements are ongoing and future acquisitions of similar services will be advertised. OIT will continue to evaluate new software solutions as they become available.

Furthermore, as discussed in Section 8 of this justification, the SEC will continue to conduct market research to remain informed on marketplace innovation and offerings, and also to ensure that the current technology in use provides the best value in addressing SEC requirements.