Financial Ecosystems Proliferate

Terry Flanagan

The data center has become a linchpin of the financial industry, with companies tapping providers in the cloud, mobile and network ecosystems, as well as niche communities within financial services.

“The most striking thing is the breadth of the participants that we have in ecosystems, across classes and across geographies,” Stewart Orrell, senior director, global enterprise at data center provider Equinix, told Markets Media. “We are making it easy for clients to connect not within our own data centers but others as well.”

Equinix has announced that multiple new customers have joined its financial services ecosystem. Its financial services customers include over 175 exchange and trading venue deployments. Today, 20% of Equinix’s revenues come from the financial vertical.

Bolsas y Mercados Españoles recently opened a new point of Presence (PoP) in Equinix London IBX LD4 to allow investments firms access to the Spanish operator. Traiana, a provider of post-trade and risk-management services has been a customer of Equinix for one year and has a point of presence (POP) in New York (NY4) where many of its customers are also co-located. Based on its experience in NY4, Traiana is considering POPs in Europe, Asia and South America as demand increases for its services.

“Its services and ecosystem are a unique selling point for us, particularly as we look to increase our presence globally in anticipation of other global exchanges and jurisdictions requiring the same pre- and post-trade services we’ve developed for U.S. markets,” John Burchenal, global head of strategic business development at Traiana, said in a release.

Equinix provides co-location for several platforms such as BIDS, Liquidnet and IEX that facilitate institutional or block-order flow. Having a financial services ecosystem in a neutral co-location facility such as Equinix delivers a mutual benefit to the platforms and their participants, according to Orrell.

“It’s a self-perpetuating system. We have a privileged view into the patterns of interconnection between the different ecosystems,” he said. “When we look at them, we see this breadth of connectivity that they have.”

The trend is to outsource data applications, whether to co-location provider like Equinix or to cloud service providers. “What we’ve seen in the last 4 or 5 years is people looking more at applications, and where it makes sense to put those applications,” said Orrell. “When you start to put applications into the cloud, actually how you access that becomes different; co-location makes more sense because then you can access networks and access cloud providers more directly. Obviously if you’re a trading participant, you want to be where the other trading participants are.”

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