  High frequency trading has led to widespread efforts to reduce information
propagation delays between physically distant exchanges. Using relativistically
correct millisecond-resolution tick data, we document a 3-millisecond decrease
in one-way communication time between the Chicago and New York areas that has
occurred from April 27th, 2010 to August 17th, 2012. We attribute the first
segment of this decline to the introduction of a latency-optimized fiber optic
connection in late 2010. A second phase of latency decrease can be attributed
to line-of-sight microwave networks, operating primarily in the 6-11 GHz region
of the spectrum, licensed during 2011 and 2012. Using publicly available
information, we estimate these networks' latencies and bandwidths. We estimate
the total infrastructure and 5-year operations costs associated with these
latency improvements to exceed $500 million.
