This is a guest post by Paolo Gorgò. To inquire about guest posts, contact the webmaster.
Hardly a week goes by without a new announcement in the financial vertical involving a data center provider. The news, actually, is that most of the times the colocation companies do not even care to put out a proper press release to inform investors about the deals.
Let’s have a quick look at Equinix.
Yesterday, the company announced the opening of the second phase of its latest London (LD5) data center. Emphasis was put on the financial exchange platform:
The campus is home to Equinix’s Financial Services offering, an active community of execution venues and other financial market participants, such as Chi-X, State Street Bank and Fixnetix, who locate in close proximity to each other to directly exchange data, speed up execution times and increase trading volumes. This new phase reflects Equinix’s ongoing commitment to meeting the growing demands of the trading community, as the adoption of high frequency trading strategies across multiple-asset classes in Europe continues to increase. Through high performance standards, consistency of service and the ability to attract key participants, Equinix continues to cement its position as the destination of choice for the financial services sector.
A few days ago, the Chicago Board Options Exchange announced that it was moving its matching engine from Chicago to Equinix’s NY4 data center in Secaucus, NJ. There’s no need to underline that this move strengthens the importance of that specific, very successful location both for the financial industry and Equinix.
Last week, the CBOE was already claiming that it had slashed its data distribution and order processing latency by more than 20 milliseconds – a result that has a deep impact in an industry obsessed by high-speed financial trading.
Almost in the same time frame, in Europe, Deutsche Börse AG announced that it was finally operating its Xetra cash market in a new data center, one of Equinix’s Frankfurt facilities.
Deutsche Börse and Equinix have already been cooperating to offer proximity services since 2006, but the move allows Deutsche Börse Group to now offer its clients co-location services from a single location for the first time.
It is no surprise that the financial industry is rapidly turning towards exchange co-location for trading solutions. It sounds like a win-win situation for all participants, and allows financial companies to concentrate on their core business, while leaving colo providers very happy to take care of hosting their servers and enjoy a very profitable revenue stream.
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