By Chris Murphy, Wall Street and Technology
22 October 2004
It used to be mostly a joke. But when talking these days about the time it takes to get information about a security – when millisecond measurements are standard and the word “microseconds” even occasionally pops up – Archipelago CIO Steven Rubinow is serious when he says he looks first to the laws of physics. “In planning some of our more foundational kind of architecture, we just start with the speed of light and start backing off from that,” Rubinow says.
Rubinow has led the technology effort as Archipelago made the switch from being an ECN to functioning as a fully electronic exchange. Technology has been a linchpin for the organization from the start, and its speed and reliability have helped Archipelago survive in a competitive market.
One of the biggest challenges is in meeting customers’ ever-increasing demands for speed. Already, response times from the most time-sensitive customers are measured in double-digit milliseconds, and the clear path is to get to single-digit milliseconds. It’s why a handful of customers have located their servers, which hold programmatic trading software, in Archipelago’s data center, where the company rents space to organizations that want to shave even the time information loses in transit. It’s also one reason Archipelago plans to move one of its matching-engine systems to its New York data center: Some New York customers wanted their servers in-house, but they didn’t want to lose even the time – that’s 24 milliseconds today – it takes to round-trip a request to Archipelago’s Chicago headquarters.
The obsession with speed doesn’t end with location. All of Archipelago’s critical applications are hand-coded to maximize performance. “We pick apart every part of the process to see where we can make it as fast as the physics allow,” Rubinow says.
Recruiting is one of the few processes around Archipelago that’s actually fairly slow, especially to find programmers as the company looks for a close cultural fit when adding to its 100-person IT staff. They do most of their programming in C and C ++, whereas a lot of hot programmers would rather work in Java; new hires need to show an appreciation for the financial industry and the demands of speed and efficiency; and they need to be willing to react to a fast-changing industry, which means programming is often done by iteration, with requirements changing constantly through feedback from business analysts and customers. “You can’t be a great coder in the corner,” Rubinow says. “The communication distance between the ultimate end-user of the system and the guy writing it is tiny. There might be one or two people in that chain.”
For Archipelago to grow, Rubinow says the company needs to do “new things” – which he acknowledges as intentionally vague, with a nod to more carefully disclosing policies since Archipelago went public this year. His technology challenge will be to integrate new business offerings into Archipelago’s systems, but without adding complexity and cost that crush the speed, efficiency and flexibility that brought Archipelago to the dance. “I think we’re going to embark on things very few if any others have done, so we don’t have a lot of models to copy,” Rubinow says. “So they’ll be fascinating, but challenging.”