This excerpt taken from the NDAQ 10-K filed Mar 14, 2005.
Cost of Revenues
Cost of revenues were $55.8 million for the year ended December 31, 2004. Pursuant to EITF 99-19, Nasdaq has recorded execution revenues from transactions executed through Brut on a gross basis in revenues and has recorded expenses such as liquidity rebate payments as cost of revenues as Brut acts as principal. Nasdaqs other execution revenues will continue to be reported net of the liquidity rebate as Nasdaq does not act as principal.