Best in Cloud: Connexus Cloud

IPC Systems won Best in Cloud (Connexus Cloud) at the 2022 Markets Choice Awards.

Traders Magazine caught up with Ganesh Iyer, Chief Marketing and Strategy Officer, IPC, to learn more.

Ganesh Iyer

What is your reaction to winning the Award at the 2022 Markets Choice Awards?

We are proud and delighted that Connexus Cloud has been awarded “Most innovative cloud-based market data delivery” in this year’s Markets Choice Awards. It also represents a recognition of the hard work and effort that the IPC team has put in to designing and launching a product that – like all our products – delivers real value at the cutting edge of innovation, for our clients.

Connexus Cloud has become an industry mainstay, establishing its position as an unparalleled trading platform connected to more than 7,000 capital markets participants across 750 cities in 60 countries worldwide. From buy-side firms to trade lifecycle providers, financial market participants globally rely on Connexus Cloud for smooth trading operations every day. As the needs of the industry continue to evolve, Connexus Cloud will be there to facilitate, making a continued impact on the industry.

Please tell us about Connexus Cloud and its most important features.

Digital transformation and the everyday integration of technology in our lives has had an impact on financial workplace cultures and structures, compelling them to be much more flexible, mobile, innovative, and to a certain degree, deconstructed; hence, market participants can’t afford to have connectivity issues interfering with generating alpha, sourcing liquidity, or mitigating risk. With this objective in mind, the IPC Connexus Cloud Managed Network-as-a-Service (NaaS) for data, voice and enterprise connectivity enables financial firms to trade faster, become more agile, and enhance competitive advantages.

IPC’s Connexus Cloud provides thousands of sub-ecosystems throughout the trade lifecycle, regardless of communication method and spanning multiple asset classes – equities, fixed income, currencies, commodities – and their derivatives, such as futures, options, forwards, and swaps.

The Connexus Cloud suite of mission-critical managed solutions includes Connexus Extranet, Connexus Ethernet, Connexus WAN for managed virtual private network (VPN), a full suite of voice services through Connexus Voice, and Connexus Crypto for enabling instant access to liquidity for the global crypto-exchanges. Additionally, one of our newest offerings, Connexus ALPHA which provides ultra-low latency connectivity, is underpinned by Connexus Cloud. All services are delivered over unified access. Connexus Cloud is protocol-agnostic and supports FIX messages, transaction standards, unicast/multicast market data, all trader voice circuit types, as well as other industry protocols.

How to accelerate and capitalize on Cloud adoption?

Cloud adoption is about more than just a change in technology infrastructure and platform, and a cost-cutting exercise. To truly realize the full benefits of the cloud, firms must adapt their culture and mindset to embrace new ways of working with new technologies. There’s a need to adopt the mindset of the challengers: agile, customer-centric, service-focused and constantly delivering new functionality and value. This can be a significant change in itself for firms.

Those financial markets participants who have been most successful in their cloud migrations and in embracing new technology typically exhibit some common characteristics. Their approach to cloud adoption and its benefits is driven by the board and business, from the top-down; it’s not relegated to a “technology initiative.” They have a high degree of integration between their business and technologists, and an increased blurring of the traditional lines of demarcation between the two.

What trends do you see in Cloud technology?

The transition to cloud technologies for trading companies won’t be entirely smooth sailing. There is the potential for new trading regulations to be implemented, while the possibility remains that COVID-19 once more disrupts the way in which people work. What’s more, in order for solution providers to supply unified access, it is necessary for them to be open source. However, with this comes concerns around data storage and regulatory compliance that arise from disrupted workflows, for example where to store voice recordings if members of staff are away from their desks. As trading firms continue adopting an increasing number of cloud solutions, hurdles such as cultural boundaries, operational issues and technology concerns will remain in place.

However, despite these potential challenges, there are no signs that this cloud adoption in the trading world will slow down. In fact, an increasing number of trading activities are likely to be moved into the cloud in the future. This belief is backed up by Chief Information Officers (CIOs), who, as per the 2021 Celent Thrive to Survive survey, believe there will be large-scale changes by 2025, with 78% of respondents anticipating the near or full adoption of cloud by 2025.

How Cloud-based SaaS can bring higher value in digital transformation for Financial Markets?

Cloud adoption can act as a “gateway” to the suite of fourth industrial revolution technologies that includes big data, enhanced automation techniques, distributed ledger technology, and AI / ML, and to all the corresponding benefits these can bring in terms of digital transformation. Cloud-based SaaS introduces models for consumption – and provision – of data and services that can evolve as the trading firm itself evolves over time – flexibly, at lower cost, and at speed.

A report published by the Association for Financial Markets in Europe (AFME), entitled “The Adoption of Public Cloud Computing in Capital Markets” cited the following key benefits of cloud adoption for financial market participants:

· greater business agility and innovation;

· improved overall cost management;

· increased operational efficiency;

· enhanced client experience and service offerings; and effective risk mitigation;

· a key technology with the potential to radically transform the financial services industry;

· a core building block for enabling adoption of other new innovations and technologies.

What is your outlook for Cloud computing?

Initially, IPC sees a steady transition to the use of cloud services, given the trading industry is quite conservative due to its heavily regulated nature. In the long term, however, globally distributed trading networks will come to the fore. Adding to this, order capabilities will transition to the cloud, followed by core matching services, alongside a step-by-step shift away from physical data centers taking place. In the future, 24/7 trading will become commonplace. This is already in place in other markets, with the exception of capital markets, and those who choose to ignore the trend do so at their own peril. The footprint of the data center may become smaller, while there will be a need for a multi-cloud approach so as to mitigate the danger of having fragmented cloud providers. This gives institutional players a potential exit strategy.

Looking ahead, it is unclear what approach users will take when it comes to accompanying their trading infrastructure and enterprise requirements. It isn’t readily apparent how cloud trading solutions will continue to evolve and develop, in terms of managing the volume of market data which is produced and consumed by capital markets participants on a daily basis. The key barometer for trading institutions, as well as the overall industry, will be what happens with the adoption of cloud by exchanges.