Commentary

Anne Plested
Traders Magazine Online News

Bottlenecks Ahead

Anne Plested, head of Fidessa's EU Regulation Change programme, has written a short blog arguing that although we should be thankful that ESMA have taken a pragmatic approach to moving things along, more bottlenecks could appear in the future.

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February 1, 2004

Handheld Combat May Soon Erupt at the NYSE

By Peter Chapman

An agreement between the two biggest suppliers of wireless handhelds on the floor of the New York Stock Exchange could lead to a showdown later this year.

NYFIX and the New York Stock Exchange both provide Big Board floor brokers with order management technology. Now the two have agreed to make their systems interoperable, enabling independent brokers to use one handheld instead of two. The implementation is expected to take six months.

Currently, many brokers carry and pay for two devices - a NYFIX system and the NYSE e-Broker - to receive orders and dispatch reports to their upstairs customers. That's both a physical and a monetary burden, traders complain.

The deal will allow an upstairs trader, using NYFIX technology to send an order to an e-Broker. And it will permit an upstairs trader using a system that routes to the BBSS, the New York's order management system, to forward an order to a NYFIX handheld. About 300 NYFIX and 600 e-Broker devices are in use on the floor.

Floor brokers will be able to dump one of their handhelds. That will lead to a battle for market share between NYFIX and the New York.

NYFIX claims it will benefit from the competition. As a private firm it can react to changing customer needs more quickly than can the Exchange, says Dennis McGilvray, NYFIX's executive in charge of floor operations.

The Big Board says it welcomes the competition because floor brokers will benefit. But it does plan to introduce a new custom-built handheld device. "We want the best technology on the floor," said Roger Burkhardt, the New York's chief technology officer.