With the INET Integration Underway, Nasdaq's CIO Looks to Crossing Networks Next
The Nasdaq Stock Market
One Liberty Plaza 165 Broadway
New York, NY 10006
SIZE OF FIRM:
Approximately $2.1 billion in average daily volume.
PREVIOUS POSITIONS:
Nasdaq, SVP in charge of application services. CIBC World Markets, managing director and head of e-commerce. Merrill Lynch: VP; various positions in the corporate and institutional client group technology division, including head of financial futures and options and prime brokerage technology, and regional head of Merrill Lynch Canada.
EDUCATION:
M.B.A from the Schulich Business School at York University in Toronto.
WHO WAS YOUR MENTOR?
Gary Rasmussen, former CIO of Merrill Lynch Canada. He was really a true visionary and understood the value of IT and how to align the IT organization as a strategic business partner.
WHAT WORK EXPERIENCE HAS HAD THE MOST LASTING IMPRESSION ON YOUR CAREER?
Relocating from Merrill Lynch Canada in Toronto to New York to head up a new organization responsible for the Corporate Institutional Client Technology Group. This was a unique opportunity to build a team from scratch and implement a global, multi-asset class sales platform.
Top 3 Current Projects
Integration of INET
Objective:
The integration of INET, acquired in December 2005, with Nasdaq's existing trading systems, Nasdaq Market Center and Brut, to create a single order book. The goal is to replace the Nasdaq Market Center and BRUT with the INET platform and innovate off a lower-cost platform. INET is an extremely fast platform and can be leveraged for trading both Nasdaq and NYSE-listed stocks.
Implementation of Technology Road Map
Objective:
A multiyear initiative aimed at producing the most-cost-effective operation in the industry. Through activities such as aggressive streamlining, simplification and consolidation of our technology infrastructure, Nasdaq has reduced technology costs by more than half since 2001 and expects to continue this trend over the next 18 months.
Nasdaq Crossing Networks
Objective:
Nasdaq is launching an IPO cross to set a single price for IPOs. Nasdaq expects to launch the first IPO cross this year. We also are looking at introducing an intraday cross, which will have three crosses a day as a mechanism for traders to better execute block trades. The focus is on rolling that out this year and making it available to both the buy and sell side.
2007 Initiatives
Crossing Networks
Continue to expand on crossing networks.
Proprietary Data
Looking at launching various new analytics products under the recently launched Nasdaq Market analytics product suite.
Data Center Consolidation
Plans to consolidate data centers from the current seven down to two. With our virtual data center model, we are partnering with a third party to provide the facilities and facilities management; we provide our own operational management. This entails setting up the server infrastructures and network connectivity into the data centers and running them in parallel before doing a final cutover.
Vitals
IT Budget:
N/A
Size of Technology Team:
N/A
Percent of IT Projects Outsourced:
Minimal outsourcing. We use external resources for staff augmentation, but ongoing management and support is internal. Most development is in-house due to proprietary nature of applications.
Key Technology Partners:
N/A
Success Metrics:
There are specific metrics to look at cost efficiency, revenue or market share growth, and also metrics for reliability and quality. Metrics are measured and tracked and, in turn, are tied into our compensation plan and the firm's overall goals and objectives.
The dramatic growth in demand for speed and transaction throughput of our systems coupled with the need for greater efficiency for low-cost infrastructure demanded by our customers is going to continue to drive innovation. Since 2001, Nasdaq's systems, through our own efficiency improvements, have reduced average transaction processing time down from 1 second to less than a millisecond -- even as we have increased our peak transaction rates more than thirtyfold. This trend will continue, driven by the continuous growth of algorithmic and black-box trading, and the implementation of Reg NMS.
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