Photo above: Equinix NY5 in Secaucus, New Jersey
In today’s Wall Street Journal, reporter Karen Keller examines the Secaucus, N.J. data center boom in “Secaucus Makes Data-Center Hookup”. In her article Keller identifies data center proximity to big business in New York City as a primary catalyst driving interest in Secaucus and we couldn’t agree more, particularly for the financial services industry.
As the largest data center provider in the New York metro area, Equinix is home to many exchanges and trading platforms, top market data vendors, a myriad of service providers, and hundreds of buy-side and sell-side firms. Equinix’s New York-area data centers serve some of the world’s largest companies, including high concentrations of financial services companies to provide access to more than 700 businesses and 135 network service providers. With three data centers in Secaucus (NY2, NY4 and NY5) the company provides colocation and low-latency connectivity to DirectEdge, CBOE, ICAP, Knight Capital, ISE and BOX to name a few. These customers understand the power of being a part of Equinix’s financial services ecosystem in New York and how it can maximize their data center investment.
Just last week, Equinix announced that BATS Global Markets selected its Secaucus data center for BATS and Direct Edge Exchanges, making Equinix its primary data center provider for all of the BATS exchange platforms, including the Direct Edge Exchanges—EDGA and EDGX. BATS and Direct Edge completed their merger Jan. 31. As a result, the Direct Edge Exchanges—EDGA and EDGX—will remain at their current location at Equinix’s NY4 data center in Secaucus, N.J., until January 2015, when they will migrate to Equinix’s NY5 data center. In the second quarter of 2015, the BATS BZX and BYX Exchanges, and BATS Options, will move to NY5 from their current location of NJ2 in Weehawken, N.J.
In today’s highly networked world, financial services companies such as BATS need to position their systems for maximum connectivity, performance and agility in order to keep ahead of fast moving trends. With the global network of Equinix data centers, BATS can achieve proximity hosting requirements while tapping into a financial services ecosystem with all the major market players.
Equinix’s John Knuff says magnet customers such as BATS, NYSE and CBOE help to further build out the depth and diversity of its participants, which is critical to the health of the global electronic trading community. NYSE Technologies moved into Equinix’s NY5 data center in Secaucus citing connectivity to Secure Financial Transaction Infrastructure® (SFTI®) as a key reason. The company operates the SFTI access center, which offers customers in the facility reduced connectivity costs, enhanced performance and simplified trading architecture. In November NYSE was bought by ICE and it was announced that they will maintain SFTI, but not NYSE Technologies.
Knuff continues, “One of the biggest advantages of the NYSE offering is the focus on customer access, making it easy to connect to their product and service offerings, including the U.S. Liquidity Center in nearby Mahwah, from anywhere in the world.” Along with the deployment in NY5, NYSE Technologies now has SFTI Access Centers inside six Equinix data centers in key markets around the world, including New York (NY1 and NY5), Chicago, Singapore, Frankfurt, and London.
One other catalyst for the data center interest in Secaucus is that the Over the Counter (OTC) derivatives market is rapidly moving to electronic trading venues. The nascent OTC ecosystem is choosing to deploy critical infrastructure at Equinix because of its well-connected, service-neutral hubs already house a significant number of their current and potential customers, effectively de-risking the development of new markets. Today 17 of the 22 Swap Execution Facilities (SEF’s) have located key infrastructure inside Equinix despite a business environment dominated by regulatory uncertainty.
In an interview with Markets Media accepting Equinix’s award for “Best Co-lo Provider” in this year’s Markets Choice Awards, Stewart Orrell, managing director of global financial services at Equinix, says, “One of the things that we were able to be very successful on last year is that a lot of the new SEF platforms and service providers signed up with Equinix to come together and start forming ecosystems. By deploying critical infrastructure in well-connected, service-neutral hubs that already house current and potential customers, firms like MarkitSERV, GFI, ICAP, TeraExchange and others are effectively de-risking the development of the nascent OTC ecosystem by piggy-backing on the benefits of the existing, mature financial-services ecosystem.” The full interview with Orrell and Markets Media can be found here.
As of today, more than 800 financial services companies are included in Equinix’s financial services ecosystem globally, including 150+ exchanges, 475+ buy/sell traders and 125+ technology providers.