You realize we are talking futures at the CME, and not equities, right? Do you actually know anything about the substance of the lead market-maker programs at the CME? As far as lining up to buy memberships/seats, every prop firm (in the Chicago, futures sense) has one. But you only need *one*. DE Shaw and RenTech only need one (slight exaggeration.... They have more than one, but not many more.) The demand for seats were driven historically by locals, thousands of little guys with a few hundred thousand in the bank.
I would say a few factors : low volume/slow market since MF collapse, more pit traders leaving and the availability of "free" electronic memberships for firms. Belonging to the IIP program like I do just cost a one-time 2K fee and then you only pay around 30 cents more per lot than true members.
You realise that you also get a rebate for providing liquidity on futures markets right ? But there's a limit on it, per month. On equities there is no limit on the rebate. That's why the rebate on the equities is known, and the rebate on the futures market is rather unknown. glad I could help.
Thanks for "helping". There are only a few market-makers in the few markets in which there's even a LMM program. And almost all of these market-makers are, well, traditional market making firms. NONE of these are "HFTs" by any stretch of the imagination. They live off of ask/bid, in the old fashioned sense. And the CME does make accommodations to attract market-makers, but cash rebates simply don't apply. (I'm actually not aware of ANY CME market in which you get paid, by the CME, for making markets.) What incentives do you get? You get priority fills from the fill engine (depending on instrument). You get rebates from some Globex fees. But you're STILL paying for clearing fees, so you are still net negative on every single commission.
Oh, and to bring things back on topic.... These market makers have nothing to do with the seat/license issue we have been talking about. There are probably 10-20 MM firms out there, total. There are thousands (tens of thousands?) of CME members.