Forefront Communications

The Financial Technologist Magazine: Will Cloud Services Providers Storm the Capital Markets?

HPR

Amanda Perrucci

Amanda Perrucci

No incumbent in any industry is truly safe these days. From Uber threatening taxis to Casper waking up the mattress business and Amazon replacing all kinds of brick and mortar retailers, technologically savvy newcomers up-ending the status quo is now commonplace. The logical next question should be: Why should the capital markets be any different?

Cloud technology is not just about moving applications  to a central provider’s data center; rather, it is a collection of systems and development approaches that provide a singular and universal computing environment. All technology frameworks and applications are destined for this environment as it usually represents the most efficient and often final stage for both.

Currently, trying to decipher a problem in a large bank’s capital markets infrastructure is like an archaeological dig. Over time, what happens with banks in their technology stacks is a terrible drive to complexity on three axes—time, geography and asset class.

As you cut through the crust of technological layers you might find that in the early 2000s whoever was head of IT thought C++ was the solution to everything. Then they were replaced by a Java devotee and the most recent layers were built by a true believer in Python and their team. Multiply this across different regions—Europe, AsiaPac and the Americas—and again by asset class, with some solutions developed in-house, others by vendors, it becomes unmanageable. Fixing it seems impossible. How are you going to take all these mission-critical systems off-line and rebuild from scratch?

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