VOL. XCIV, NO. 247
★ WIDE MOAT STOCKS & COMPETITIVE ADVANTAGES ★
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Sunday, December 28, 2025
MSCI Inc.
MSCI · New York Stock Exchange
Weighted average of segment moat scores, combining moat strength, durability, confidence, market structure, pricing power, and market share.
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Overview
MSCI is a global provider of investment indexes, analytics/risk tools, sustainability and climate data, and private-assets data/workflows. The Index segment benefits from de-facto benchmark status and high retention, supporting strong pricing power, though large ETF issuers can pressure fees and self-indexing is a risk. Analytics is sticky via API/application integration into portfolio and risk workflows, but competes with broader financial data platforms and portfolio systems. Sustainability and Climate shows medium-strength lock-in tied to regulatory navigation and investor-process integration, but faces methodological scrutiny and competitive multi-sourcing. Private Assets is driven by workflow embedment in private capital and real assets, with moderate switching costs and intense competition.
Primary segment
Index
Market structure
Oligopoly
Market share
23%-27% (implied)
HHI: —
Coverage
4 segments · 5 tags
Updated 2025-12-28
Segments
Index
Investment indexes and index licensing
Revenue
55.9%
Structure
Oligopoly
Pricing
strong
Share
23%-27% (implied)
Peers
Analytics
Investment risk analytics, portfolio construction and risk models
Revenue
23.6%
Structure
Oligopoly
Pricing
moderate
Share
—
Peers
Sustainability and Climate
ESG ratings, sustainability data, and climate risk analytics
Revenue
11.4%
Structure
Competitive
Pricing
moderate
Share
—
Peers
Private Assets
Private markets and real assets data, benchmarks, and workflow tools
Revenue
9%
Structure
Competitive
Pricing
moderate
Share
—
Peers
Moat Claims
Index
Investment indexes and index licensing
Revenue_share and operating_profit_share derived from FY2024 segment operating revenues and segment Adjusted EBITDA disclosed in MSCI's FY2024 earnings release (8-K Exhibit 99.1).
De Facto Standard
Network
De Facto Standard
Strength: 5/5 · Durability: durable · Confidence: 4/5 · 2 evidence
MSCI indexes are used broadly for benchmarking and as underlyings for index-linked products (e.g., ETFs), creating benchmark inertia and reinforcing adoption.
Erosion risks
- Asset managers self-indexing / in-house benchmarks
- Fee compression from large clients and passive price competition
- Benchmark or index regulation changes increasing compliance burden
Leading indicators
- Assets benchmarked to MSCI indexes and AUM linked to MSCI indexes
- Index segment Retention Rate
- Index Run Rate growth and asset-based fee growth
Counterarguments
- Top-three index providers are substitutes for many use cases
- Custom index tooling reduces differentiation over time
Switching Costs General
Demand
Switching Costs General
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
High subscription retention suggests sticky relationships; benchmark switching can require mandate, reporting, and product updates.
Erosion risks
- Index/benchmark migration during periodic mandate reviews
- Customer consolidation increases negotiating leverage
Leading indicators
- Index retention rate trend
- Renewal pricing and discounting for largest clients
- Number/value of benchmark reassignments by large ETF issuers
Counterarguments
- Some mandates can switch benchmarks at periodic review cycles
- Large clients may negotiate material fee reductions
Compliance Advantage
Legal
Compliance Advantage
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 1 evidence
Authorization as a benchmark administrator in key jurisdictions is table-stakes for regulated benchmark users and can raise the bar for entrants.
Erosion risks
- Regulatory harmonization lowering incremental advantage
- Compliance costs rising faster than pricing power
Leading indicators
- Benchmark regulation changes and enforcement actions
- Compliance and legal spend as a % of revenue
Counterarguments
- Major incumbents all meet benchmark regulation requirements; advantage may be limited versus peers
Analytics
Investment risk analytics, portfolio construction and risk models
Revenue_share and operating_profit_share derived from FY2024 segment operating revenues and segment Adjusted EBITDA disclosed in MSCI's FY2024 earnings release (8-K Exhibit 99.1).
Data Workflow Lockin
Demand
Data Workflow Lockin
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
Analytics tools are embedded in client risk/performance workflows via apps and APIs; integration plus historical model continuity increases switching costs.
Erosion risks
- Commoditization via open-source models and cloud-native analytics
- Platform displacement by all-in-one portfolio systems
Leading indicators
- Analytics retention rate trend
- Attach rate of multiple analytics modules per client
- Renewal discounting vs list price increases
Counterarguments
- Customers can multi-home across analytics providers (e.g., Bloomberg, FactSet)
- System-of-record platforms can limit a point-solution's pricing power
Switching Costs General
Demand
Switching Costs General
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
High recurring subscription retention indicates sticky usage once operationalized in risk and performance processes.
Erosion risks
- Budget pressure leading to vendor consolidation
- Functionality overlap with competitors reducing differentiation
Leading indicators
- Gross retention and churn in Analytics
- Sales cycle length / renewal friction
Counterarguments
- If analytics becomes a standard feature in core platforms, point solutions face pricing pressure
Sustainability and Climate
ESG ratings, sustainability data, and climate risk analytics
Segment called 'ESG and Climate' in FY2024 disclosures; renamed 'Sustainability and Climate' in 2025 reporting. Revenue_share and operating_profit_share based on FY2024 segment numbers.
Data Workflow Lockin
Demand
Data Workflow Lockin
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 1 evidence
Sustainability and climate data is often embedded into investment processes and regulatory reporting, making provider changes operationally costly once adopted at scale.
Erosion risks
- ESG methodology controversies and regulatory scrutiny
- Standardization reducing differentiation across providers
- Political backlash lowering client demand in some regions
Leading indicators
- Segment retention rate and new subscription sales
- Regulatory deadlines driving reporting adoption
- Product multi-adoption per client (ratings + climate + screening)
Counterarguments
- Clients can multi-source ESG data and arbitrate ratings
- Standardized disclosures can commoditize parts of the data stack
Compliance Advantage
Legal
Compliance Advantage
Strength: 2/5 · Durability: medium · Confidence: 3/5 · 1 evidence
Regulatory compliance (e.g., registered investment adviser status for a unit) can increase credibility for certain clients, but is not unique among large providers.
Erosion risks
- Compliance becomes baseline across major competitors
Leading indicators
- Regulatory actions affecting ESG ratings providers
Counterarguments
- Regulatory status may not translate to pricing power or durable differentiation
Switching Costs General
Demand
Switching Costs General
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 1 evidence
Retention is high but reflects a more contested market than Index/Analytics.
Erosion risks
- Client ESG budgets shrink or shift due to regulation/politics
Leading indicators
- Churn following methodology changes
- Segment growth vs peers' disclosed growth
Counterarguments
- ESG data can be substituted with alternative sources and internal research teams
Private Assets
Private markets and real assets data, benchmarks, and workflow tools
Corresponds to 'All Other - Private Assets' in MSCI segment reporting; includes the Real Assets and Private Capital Solutions operating segments. Revenue_share and operating_profit_share based on FY2024 segment numbers.
Data Workflow Lockin
Demand
Data Workflow Lockin
Strength: 4/5 · Durability: durable · Confidence: 3/5 · 1 evidence
Tools support mission-critical LP/GP workflows (terms, company operating performance, risk), making replacement disruptive once embedded.
Erosion risks
- Data integration standards and APIs enabling easier vendor switching
- Consolidation as platforms acquire private-market data providers
Leading indicators
- Private Assets retention rate trend
- Private market AUM growth and benchmarking adoption
- Workflow module adoption (monitoring, reporting, risk)
Counterarguments
- Clients may rely on multiple vendors and internal data
- New entrants can target niches by asset class or region
Switching Costs General
Demand
Switching Costs General
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 1 evidence
Retention is lower than other segments but still high, consistent with sticky subscriptions and integrations in private asset tools.
Erosion risks
- Price competition in private-market data products
- Client preference for one-stop platforms
Leading indicators
- Renewal discounting and churn in Private Assets subscriptions
Counterarguments
- Some private data products are easier to swap than benchmarks; switching friction can be moderate
Evidence
$16.5 trillion ... benchmarked to MSCI indexes
Large benchmarked AUM supports 'de facto standard' and benchmark inertia.
Largest client ... BlackRock ... 10.3%
Shows a major ETF issuer's economics are tied to MSCI index-based fees.
Index retention ... 94.7%
High retention supports switching-cost and procurement-inertia dynamics for recurring subscriptions.
UK FCA ... benchmark administrator ... BaFin ...
Regulatory authorization supports compliance-based barriers to entry for benchmark administration.
Index segment total operating revenues for FY2024 were $1,596,145 (in thousands).
Showing 5 of 11 sources.
Risks & Indicators
Erosion risks
- Asset managers self-indexing / in-house benchmarks
- Fee compression from large clients and passive price competition
- Benchmark or index regulation changes increasing compliance burden
- Index/benchmark migration during periodic mandate reviews
- Customer consolidation increases negotiating leverage
- Regulatory harmonization lowering incremental advantage
Leading indicators
- Assets benchmarked to MSCI indexes and AUM linked to MSCI indexes
- Index segment Retention Rate
- Index Run Rate growth and asset-based fee growth
- Index retention rate trend
- Renewal pricing and discounting for largest clients
- Number/value of benchmark reassignments by large ETF issuers
Curation & Accuracy
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