Wall Street & Technology is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.


01:59 PM
Connect Directly


.NET? J2EE? Brokerage firms try and decipher the Web-services landscape.

Microsoft and Sun Microsystems are at it again. For sometime now they have been competing in the Web Services space - each hopeful to emerge as the provider of choice. Financial-services firms say both Microsoft's .NET and Sun's J2EE have their benefits - which makes the challenge of which to choose that much more difficult.

When Luca Giachino, vice president of SunGard Trading and Risk Systems, wanted to create Web access to Panorama - his firm's straight-through-trading, portfolio-analysis, risk-management and processing solution used by more than 120 financial institutions - his developers built the connection using components of Microsoft's .NET architecture rather than a Java-based solution.

The key reason? "We are a Microsoft shop," Giachino says of his division of SunGard, which he notes is a "very large company" where different divisions use different technologies. "Very few organizations have the luxury of starting a project straight from scratch," he says. "You have to deal with the past and where you came from."

Using Visual Studio .NET, Microsoft's rapid application-development tool for building next-generation Web applications, Giachino says his developers were able to build "better software in a short amount of time. We found it useful," he says.

The result was Panorama KnowledgeFactory, a Web-based data-analysis and reporting solution that is Web-server independent and scalable to meet high volumes. The system speaks to the existing Panorama application, negating the need for SunGard to rewrite code to support Web access. "The good thing is we didn't have to change the Panorama application."

.NET is Microsoft's vision of building Web services to allow applications to share data and communicate using standard Internet protocols.

It's in competition with Sun Microsystems' Java 2 Enterprise Edition (J2EE) for control of Web services, a market that is expected to take off in the coming years as brokerages seek more interoperability among their internal and external systems.

Factor in the possible move to one-day settlement and the need to build straight-through processes, which has financial institutions examining their technological infrastructure, and it has many chief information officers pondering where, if at all, .NET fits into the equation.

That's certainly the case at Edward Jones. Larry Steele, chief technology officer at the St. Louis, Mo.-based firm, has been studying .NET while attending a recent seminar where, "We went through the development environment. One of the compelling things I saw was their mobile-devices strategy," he says. Rather than having to deal with individual carriers, MS provides an interface into the different carriers' infrastructure. "Typically, you have to do that yourself," he says.

Rich Malone, chief information officer at Edward Jones, explains that his brokerage is "looking at its entire architecture," promoting a cursory examination of .NET. Edward Jones is primarily a UNIX environment featuring Solaris, Java and Cobalt. "We're not a big Microsoft shop."

However, he notes, "Our architecture has evolved over the last 20 years" and you need to continually "take a fresh look. We're doing our homework," he says.

Malone says there is much tire kicking going on when it comes to .NET. In talking to other CIOs at brokerage firms, he says, "some are intrigued by it," others "don't have a whole lot of knowledge" about .NET and, like his firm, are learning about it. "People are still in the education mode."

Suresh Kumar, chief information officer at Pershing, says that after examining .NET versus J2EE, he thinks that the "Java language itself is a lot more developer friendly."

As well, "The Java language is a lot more mature and there's wider acceptance in the user community."

However, he sees a role for .NET in developing front-end applications to "take advantage of MS Windows. It's a lot easier" and can provide a "tightly integrated environment." However, that can also be a bad thing, in terms of hardware, because there's single-vendor dependence, compared to Java, which is supported by multiple vendors and there's also a "lot more hardware."

Another criticism of .NET versus Java is that Java supports languages that can run anywhere, while .NET is confined to Windows. "The .NET approach is a windows-only approach," and there are issues about its ability to "scale up into very high volume-type environments," explains Stefan Van Overtveldt, director for technical marketing at IBM WebSphere, a Web services-development platform steeped in J2EE.

Non-Microsoft firms that want to switch to a .NET Web services environment are going to have to "make a big investment redeveloping a lot of their applications to run on Windows," he insists. For example, "a lot of companies have major investments in building directory servers," which is like a phone book for applications. ".NET means having to rip out these directory servers and replacing them with Microsoft Active Directory."

Kumar notes that brokerages tend to be either Microsoft centric or UNIX centric, with the latter focusing on Java. Because Pershing deals with both types of firms, "We're looking at both (platforms) and investing time in both. They do have their advantages." Besides, he notes, "Competition among vendors is always good."

Another concern, Van Overtveldt says, is security. Java, he says, provides a "very tight" environment for security. Giachino notes that security is one area where people are "pointing a finger," but he calls the concerns "debatable" and Microsoft officials at a recent .NET seminar indicated that security is a high priority for the company.

Microsoft also touts .NET as a means for lowering the cost of development and speeding up the development process, which Giachino has seen first hand. "The tools give us good time to market and are fairly easy to use. Edward Jones' Steele, however, is not so sure. "I've not found anything that says we're going to reduce complexity. There's more moving parts, more pieces."

That's not to say .NET won't find a home in brokerages. Already Credit Suisse First Boston uses the .NET framework to reduce the cost of deploying and supporting desktop applications. Investment bank Dresdner Kleinwort Wasserstein has used .NET technology to build an internal Web site for managing IT projects, which replaced a Java application, and to build BrokerPulse, an online-investor-relations service that tracks IPOs, new issues, and share ownership.

Baseline Magazine recently reports that 70 percent of companies are using some type of Java development tools when building e-business applications, compared to 33 percent who use Microsoft.

Malone says there's "no doubt Microsoft has a big presence in our industry. I don't doubt whether this product will have a place. Whether there's a place at Edward Jones is not determined."

Register for Wall Street & Technology Newsletters
Exclusive: Inside the GETCO Execution Services Trading Floor
Exclusive: Inside the GETCO Execution Services Trading Floor
Advanced Trading takes you on an exclusive tour of the New York trading floor of GETCO Execution Services, the solutions arm of GETCO.