Two seconds: that’s the lead time a select group of investors had to receive a copy of the University of Michigan consumer confidence report before other institutional investors. While two seconds may not sound like much, it was often worth millions of dollars to high-frequency traders who account for about half of all daily U.S. stock trading.

Thomson Reuters distributes the consumer sentiment report as part of an arrangement with the University of Michigan, and until this week it sent the report to a select group of clients two seconds before all other clients. Reuters reportedly paid the university an additional $1 million to distribute the data to a group of elite clients who paid the media giant $6,000 a month for the 2-second advantage. Reuters would not confirm these figures.

Following a review by the New York State Attorney General Eric Schneiderman keying off a whistle-blower complaint, Thomson Reuters is now suspending the two-second early release for selected investors.

“It is definitely a PR move,” says the Daily Ticker’s Henry Blodget. “I think they were forced into it.”

Blodget doesn’t expect the decision will do small investors any good. “The market will never, ever be safe for the little guy,” says Blodget. “So anything we do that makes it appear a little bit safer…is actually worse because then people think they are on the same playing field as the little guy.”

Indeed, the personal investor who doesn’t have a Reuters account can’t even see the University of Michigan consumer sentiment report until five minutes, or 300 seconds, after Reuters clients.

Should we assume some hedge funds or other big investors are getting data early—data that’s compiled by nongovernmental sources like the S&P/Case-Shiller home price report or the ADP jobs report?

Blodget says that it's certainly possible. ComScore, for example, sells data about websites to institutional investors like hedge funds. The Thomson Reuters story “is just the tip of the iceberg. There is so much more than that out there,” says Blodget.

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