Adam: Let's start by you telling us a little about yourself and how you came to MarketPrizm.
Jacob: I was a Fidelity person for many years. Colt acquired MarketPrizm from Instinet, a Nomura company. Colt owns the majority shareholding. I was brought in as VP architect from Fidelity's capital markets technology team to oversee the technical aspects of due diligence for the acquisition. So I started working on the MarketPrizm space in September 2010, and then signed on as CTO in May 2011.
Structurally, we wanted a design to knit together the customer business functionality opportunities along with the technology and try to cross the often great divide between product and sales teams and technology. Both of those are under my organisation. We have a team of developers that are native to Hong Kong. Some of them have been with MarketPrizm in its prior incarnations - for 12+ years in one case, 18+ years in another - so they're quite seasoned with the problem space, the markets and with the technology.
Adam: So you have an interesting perspective, coming in from the business side, to run the technology for a vendor.
Jacob: It was an interesting experience for me to be, if you would, a consumer wanting the MarketPrizm type of service. One of my tasks in my Fidelity role was to migrate the trading products into co-lo data centres. These were the primary electronic trading engines and the ATS. Our team job was to design, engineer and deploy all of the products and the technologies into co-location data centres in New Jersey and New York.
Each customer is quite different in complexion or their maturity level or their business needs, so it is a layered problem to get servers deployed, to get racks provisioned, to get data flowing, to get the people who are working in these companies access to the equipment, and the ongoing maintenance and monitoring. In order to get one of these setups working, you really have to cover a lot of different bases. MarketPrizm's position is to offer the capability to address those problems soup-to-nuts or on an à la carte basis. If you want a server in Singapore, we would provision the equipment and give a handoff at a monthly fee. We have the entity in Singapore [and many other locations], we buy the equipment so that a company does not have to have an entity in these countries. And yet they can take on the challenge of trading with a lower barrier of entry.
In some countries with difficult legal hurdles, just getting translations of documents is a challenge. The mechanics of doing it are tough. Part of our offering is we've set up the legal entities, we have the relationships with the vendors, and we're able to do it in either a pure-service model, where the company is staking no capital, or we'll do it in more of a provisioning mode.
This kind of thinking and this equation is true in a number of other areas. One is around circuits. You know, it's the same market data going everywhere, and lots of companies buy their own dedicated circuits. And the vendors love it because they're selling more and more of the same stuff, servicing the same data. The cost point for the customer can be quite high. What we've done is set up as a vendor of record and redistributor of market data and we mutualise that across multiple customers and can offer a more competitive cost point, and also an easier or quicker time to release because we've already provisioned it.
Jacob: That's correct. The customer could be in a co-lo where two or three customers would like LSE data, for example. We have the LSE data coming into our racks and switches and they can cross-connect to us and receive that data from us in an ultra-low-latency fashion.
MarketPrizm's service delivery team
Adam: Someone wants Taipei Stock Exchange data. You will have an agreement with them that, instead of making numerous round-trips with different customers, you will pipe the data once over to London and then redistribute it from there, to whichever customers are in London. Have I got that right?
When you are managing the layer one, the physical infrastructure, there's a whole set of powerful functions that can be had. Provisioning a multiple10-gigabit circuit for example. Because we're on the layer one, we can provision a huge number, like 400 gigabits worth of bandwidth. We actually put the light waves on the glass for those. And that also means that we can segment the traffic.