When it comes to business computer systems, nothing, but nothing, is more mission-critical than the massive trading software systems that underlie stock markets. A failure of an hour here can mean billions of dollars of lost trades. The LSE (London Stock Exchange) learned that the hard way when their .NET/Windows Server 2003 trading platform died like a dog early last September. The new LSE management is going to go make that mistake again. This October, the LSE purchased MillenniumIT and it will be switching its stock exchange programs to the company’s Linux-based Millennium Exchange software.
I saw this move coming. While the LSE never officially announced that its Windows and .NET stock trade software TradElect was the root of its September failure and its perpetually slow performance, it was an open secret in the City, London’s equivalent to America’s Wall Street, that that was the case. Indeed, it was this technology flop that lead to the LSE CEO Clara Furse leaving the Exchange in July. The new CEO, Xavier Rolet, immediately decided to get rid of TradElect and started shopping for other platforms.
Friends of mine in the City tell me that the LSE immediately started considering a Linux-based solution. It doesn’t take a genius to see why. The world’s fastest stock exchanges, like New York’s International Security Exchange, run on Linux. In a world with high-frequency trading where a millisecond really can mean the difference between profit and loss, stock exchanges can afford to be slow, never mind actually going off-line.