Sun was chosen by the Archipelago leadership team wanting an exchange trading system that would be capable of handling a 300% increase in trading volume. As the nation's first totally open, all-electronic stock exchange, the Archipelago Exchange (ArcaEx) began transitioning Nasdaq-listed stocks from its Electronic Communications Network (ECN), which currently interacts with approximately 1 in 4 Nasdaq shares traded, to the new trading platform on February 14, 2003. Since Archipelago has seen share volume grow from 30 million shares per day in 1999 to approximately 400 million shares per day today, a trading system that could handle accelerated growth was critical.
"To achieve our goal of becoming a fair, efficient and open marketplace for all investors, we need to provide an exchange platform that is reliable, scalable and fast. It's no secret that Sun has the expertise and systems to handle the volume that we see today and the volume we anticipate tomorrow," said Putnam, who will be partcipating at Sun's Worldwide Analyst Conference today. "That's why we were able to replace hundreds of servers with just a handful of Sun Fire systems and still improve overall performance."
"Archipelago required the type of availability that a traditional exchange would require, and then to really win, they required an aggressive timetable. Nobody thought that Archipelago and Sun could get the system into production so quickly," said McNealy. "What they've done here is tighten their security, improve their efficiency, and maximize their readiness to grow. I like to think of Archipelago as a poster child for Wall Street."
The enhanced electronic exchange will now run on a range of Sun Fire [TM] servers, including Sun Fire V880, V480 and 4800 servers. The enhanced system must accept and book orders at 5,000 orders per second, and provide up to 500 simultaneous customer connections. The maximum number of orders in a day required for the system is 15 million. The maximum number of trades per day is 10 million with15,000 events at its peak.
"Over the last four years, ECNs have fundamentally changed the competitive landscape in the U.S. securities industry. After much uncertainty over the last six months, we have entered a new period of market consolidation with the emergence of only a few powerful market hubs providing strong liquidity, and through this, opportunity for best execution," said Octavio Marenzi, Managing Director of Celent Communications, an industry analyst firm who closely watches the financial services industry. "We expect this consolidation and evolution to continue with Archipelago becoming one of the few market hubs capable of delivering value to the marketplace. Synergies between Archipelago and Sun Microsystems are well positioned in this competitive landscape."
