Linux's march across the financial-services landscape has been formidable, as evidenced by Sun Microsystem's recent concerted efforts to win back the loyalty of the Wall Street community. But the decisions that several exchanges are making around Linux currently, however, show that a Linux-dominated environment is not necessarily inevitable.
A recent convert to Linux, the Chicago Mercantile Exchange is finding that the platform delivers much better returns than expected. The CME is changing the infrastructure that runs its iLink gateway - which traders use to access the exchange's Globex electronic trading platform - from Sun Microsystems servers running Solaris to Intel servers with Itanium processors running Red Hat Linux.
The CME pursued Linux for cost savings at first, says Charlie Troxel, the exchange's chief technology officer, but it was surprised to discover that the platform delivered much better performance - CME is experiencing five times the performance of Sun/Unix at one-fifth the price, says Troxel. That's why the exchange planned to replace 20 percent of its Sun servers with Linux servers by the end of 2004, and why it's now on track to replace as much as 50 percent of its Sun servers.
The exchange will continue to run its database of historical trade information on Sun servers, however. That database is used to recreate trades in the event of inquiries from customers or regulators. The system - which uses database technology from Oracle - has reliability and scalability requirements that aren't easily met by Linux, Troxel says. He adds that the number of database entries has spiked from 2 million per week two years ago to 500 million a week in December 2004.
Money Isn't Everything