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December 1, 2001

Happy Ending For Macgregor Saga? Abandoned' Customers Watch Closely

By Peter Chapman

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  • Happy Ending For Macgregor Saga? Abandoned' Customers Watch Closely

Buyside order management king Macgregor is betting its new platform will cure its schizophrenia.

The system - Macgregor XIP - is both an upgrade and a rebranding of the Macgregor Financial Trading Platform (MFTP). But, more importantly, it is a replacement for Predator, MFTP's sister product. After struggling for the past two years to support two order management systems, Macgregor hopes to migrate Predator users off Predator and onto XIP.

In addition to simplifying its own life, Macgregor expects the move to mollify some upset customers. Many feel Macgregor has abandoned them to devote itself to the larger group of MFTP customers.

Ever since Macgregor bought its larger competitor, Merrin Financial, in May 1999, it has been responsible for two distinct order management platforms. MFTP, then known as the Merrin Financial Trading Platform, is the industry leader with 51 installations. Predator, Macgregor's creation, has 22.

Despite assurances by Macgregor at the time that it would incorporate the best of both systems into each other, the traffic has been mostly one-way. MFTP users got Predator's well-regarded connectivity capabilities, for example, while Predator users were left with an outdated database.

Macgregor CEO Steve Levy denies the firm has neglected its Predator customers, pointing to the recent release of version 2.3 as an example of its "extensive" support. Still, he does acknowledge Macgregor has stopped marketing Predator.

Levy admits Macgregor has not been able to meet all of the demands of its Predator customer base, but pledges the wait for XIP will be worth it. "We took a very deliberate approach," Levy said. "We wanted to make sure we understood every aspect of how our customers would be using the new system before we started providing the migration path."

Although version 1.0 of XIP will roll out early in 2002, Predator users will not receive the necessary migration tools until the release of version 1.1 in the third quarter. And because of the long lead-time involved in any large systems switch, it will likely be years until the last Predator user converts. Some may never. Version 2.0, due out in early 2003, will mark the end of the upgrade process.

Predator users generally applaud Macgregor's move. "We see it as a positive," said Mike Thorfinnson, COO and CFO at Toronto's TD Asset Management. "But it is something we have expected for some time." Thorfinnson is encouraged by MFTP's better "underpinnings" - specifically its database - and its fixed income capabilties.

A consultant agrees. "Steve is finally moving the user base forward," said John Clark, a principal at Cutter Associates of Duxbury, Mass. "It's the right thing to do." A consultant's stamp of approval is critical for small software vendors as buyside traders and their technologists often lack the time or resources to properly evaluate all of the offerings.

Cutter does in-depth product research and evaluation for 40 money management firms in its consortium, the Technology Council. It has consulted on about 25 installations of order management systems in the past three years.