I read the paper on the iPad – but I still get a kick out of being quoted in print (see page B6 of today’s NY Times). But I digress…
It looks like the European’s aren’t as into the proposed NYSE/Deutsche Borse merger as the Americans are. Although details are not yet available, it seems likely they’re concerned with the tie up of Liffe and Eurex creating a near European monopoly on futures trading. But in my opinion, that ignores how global the derivatives markets are. CME has 98% of futures volume in the US. This certainly makes it hard for new futures exchange to get much traction (ELX keeps trying and Liffe US seems to be getting somewhere), but since CME competes on a global rather than a regional stage they’re certainly not resting on their laurels or over charging customers. My comments in the paper:
Kevin McPartland, head of fixed income research at the TABB Group, said the European regulators were looking at the impact on a regional level, while antitrust authorities in the United States — who saw a combined entity competing globally with rivals in New York and Singapore — had taken a more global view in granting their approval.
If the companies were told to sell Liffe as a condition for approval, he said, “it would look a lot less appealing.” But he added: “There are enough potential compromises that they could work through most concerns.”
Read the full story at NYTimes.com (or on page B6!).
NYSE announced recently that they’re launching a cloud computing platform aimed at financial services firms. I must admit I think they’re on to something. About a year ago I suggested in a TabbFORUM video that if someone was to create a cloud environment aimed at financial services (ideally with the backing of the relevant regulators) it could be very successful. It seems the NYSE is going in that direction. And as I mention in this article, Silicon Valley seems to have gotten over the credit crisis and now wants to ramp up selling to Wall Street again:
“In the last six months we’ve seen very very strong renewed interest in financial services from big tech firms,” says Kevin McPartland, an analyst at Tabb Group in the US. “It’s like the Silicon Valley-Wall Street partnership.”
NYSE’s new Mahwah data center is finally set to go live this coming Monday. It will only be for a few stocks, but after years of working, waiting and talking about the project its exciting to see this big investment (and risk) for NYSE get moving.
The only signage noting the property’s high-profile tenant is a plaque near a buttonwood, McPartland noted.
The plaque notes the data center “houses the most technologically advanced financial marketplace in the world.”
“It could have just as well been Area 51 or CIA headquarters,” he wrote. “Fences, cameras, guards and ID scanners are everywhere, yet the buttonwood trees and picnic tables out front made it feel like a nice place to spend an afternoon.”
Read the full article at NorthJersey.com
The New Buttonwood Tree – Literally
Also posted on TabbForum.com
The only thing in the entire 17-acre facility with the letters N-Y-S-E is a small plaque surrounded by buttonwood trees in front of the main entrance. Even after passing through several security checkpoints, some with good old-fashioned guards and the rest with ID scanners, only employees or the best fintech geeks would be able to see where they were. As NYSE Euronext’s new Mahwah data center goes hot on August 9th, it is clearly ripe to be the new center of the US equity markets.
The level of security takes you aback even before you approach the non-descript entrance. From the road it looks more like a prison than the future hub of US capital markets – and I mean that in a good way. It could just as well have been Area 51 or CIA headquarters. Fences, cameras, guards and ID scanners are everywhere, yet the buttonwood trees and picnic tables out front made it feel like a nice place to spend an afternoon.
Only a small portion of the 400,000 square feet is built out yet, but the amount of fiber optic cable we saw once inside the pod that will house nearly all of NYSE Euronext’s US matching engines was mind boggling. Unfortunately we weren’t allowed to go near the customer cages that already had equipment and into the room where the 100G fiber optic cables sit that will ultimately transmit every single NYSE Euronext order coming in from the outside world. But clearly this is a facility designed to move around a LOT of data.
Another cool feature was the living room-sized touch screen TVs surrounding the servers that let technicians see everything from literal hot spots to a map of server cabinets. If a power outlet was to go out or a single server was to overheat, someone could be on it in seconds. Some of this data will be made available to customers in real time, too. It was clear that no expense was too great in their quest to create the most sophisticated data center on the planet.
My visit to Mahwah is my fifth trip to NJ in recent months to see a financial services data center, and all were worth the trip. No matter how strong your technical background, it doesn’t all come together until you see it live and in living color. In the end, business models will ultimately drive the success of exchanges and data center providers, not the type of trees planted out front. However, perception is reality and this certainly points NYSE Euronext in the right direction.