Sure enough, Infolect suffered connectivity failures on November 7 2007 which embarrassed the LSE after promoting its systems as a model for other exchanges.
Worse, on the fateful day in September 2008 when the U.S. Government came to the rescue of Freddie Mac and Fannie Mae trading at the LSE ceased at 9:15am GMT due to a “software-related” fault. The outage lasted six hours and 45 minutes.
Reuters reported the words of one trader who said, “We have the biggest takeover in the history of the known world ... and then we can’t trade. It’s terrible.”
Computerworld ascribed the critical downtime directly to the Microsoft/Accenture software, while citing anecdotal comments from traders about how slow the system could get.
This month the LSE announced its acquisition proceedings for MillenniumIT, a Sri Lankan development company with expertise in reliable, scalable production systems.
David Lester, the exchange’s Director of Information and Technology said, “The new technology is a lot lighter, nimbler and easier to install.”
Ironically, Lester added, “It will also enable faster releases” with Infolect still requiring three to six months between releases despite the problem of change management being one of the original driving factors to switch in the first instance.
This acquisition of a vendor is a remarkable shift in the LSE’s technology strategy which previously outsourced as much as possible.
The new platform, produced by MillenniumIT, will be based on Linux and Solaris with an Oracle back-end database. A Norwegian exchange will also migrate to MillenniumIT, while the New York Stock Exchange adopted Linux two years ago.
It is expected the new deployment will take 18 months and offer trading speeds six times greater than that permitted by the Microsoft architecture, from 2.7 milliseconds to 0.4 milliseconds.
In an industry where milliseconds really can mean the difference between profit and loss it’s small wonder the stock exchange has decided to cut its losses, abandoning the $USD 65m Infolect system after only four years.
In a further blow to Microsoft the LSE also predicts moving to Linux will save a further 10m pounds (or $USD 14.7m) through reduced hardware requirements, licensing costs, technical staff and related items.