2020 Outlook: Anthony Amicangioli, HPR
Anthony Amicangioli is Founder and CEO of Hyannis Port Research.
What was the highlight of 2019?
Last November HPR launched Omnibot, the industryâ€™s first networking device that integrates direct market access, risk management, data delivery and latency capture functionality into a single multi-application switch. This is a key step into advanced cloud infrastructure systems.
In 2019, we saw Omnibot become an essential technology for the capital markets. Larger sell-side firms are currently engaged in an asymmetric technology race with the market makers who have their roots in high frequency trading. By simplifying and unifying market participantsâ€™ back ends and positioning data center architectures on par with cutting-edge technology firms, Omnibot helps them level the playing field.
What surprised you in 2019?
In 2019, we saw cloud continue to become more pervasive and integral to the capital markets future. However, what surprised us at HPR is that although the desire to implement cloud strategies is there, cloud migration is not simple, and firms are struggling to craft cloud strategies to drive their businesses.
Despite technological advances, modern cloud systems require expertise in numerous technology specialties, such as high-performance computing, advanced data-center network systems and chip/FPGA design. While the leading cloud providers are strong in these areas, most critical financial applications cannot be placed on public cloud infrastructure as they have highly specialized requirements. This has presented a daunting technology management challenge for the incumbent financial services companies grappling with their cloud strategies.
What are your expectations for 2020?
Cloud adoption has clearly been a major theme over the last few years, and we expect to see it only accelerate in 2020.
In 2019 we saw the cloud space evolve in several different ways. On one hand, tech giants like Google are reconfiguring their offerings in order to work with financial services institutions by taking an industry-specific approach to service-level agreements. On the other hand Bank of America is an example of financial institutions moving deeper into the cloud is. According to a recent interview given by their CEO, Brian Moynihan, their cloud strategy has allowed the firm to reduce their server count by more than two-thirds, from 200,000 to 70,000.
2020 will be a deciding year for financial institutions. The industry is reaching an inflection point where firms who do not start adopting cloud soon will fall even further behind those who have, splitting the industry into two camps â€“ the winners and the losers.
Firms are accelerating the buildout of digital transformation strategies.
Expect to see several new entrants in the equity exchange landscape.
CEO sees big potential for financial innovation in digitized assets.
Capital markets will continue to integrate and globalize.
SFTR implementation and the demise of LIBOR will be key themes this year.