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A-Team Insight Blogs

Turning Up the Volume on Wireless

Judging by the views of a number of wireless network equipment manufacturers and service providers participating in last week’s Low-Latency Summit in New York City, demand from trading firms for low-latency wireless connectivity is strong despite the challenges of reliability, limited bandwidth and cost.

Speaking as part of the “Are You Tuning In to Wireless?” panel were: Jay Lawrence, CEO of wireless equipment manufacturer and network operator NeXXCom Wireless; Andrew Kusminsky, COO and CSO of Perseus Telecom, which operates both fibre and wireless networks; and Marty Snyder, president of wireless network integrator Communications Infrastructure Corp. Also on the panel was Mike Schonberg, director of market data technology at Quincy Data, which distributes low-latency market data via a wireless network provided by affiliate McKay Brothers.

On the demand for wireless networks:

“A tremendous amount of demand … triple digit growth for our company,” – Marty Snyder, CIC.

“Early adopters are those that are very latency sensitive but every firm that is still somewhat latency sensitive will need to close the gap to keep up,” – Mike Schonberg, Quincy Data.

“Demand curve is shifting from those looking to build their own wireless networks to those looking to buy a drink on an incumbent network … these things are not cheap to build,” – Jay Lawrence, NeXXCom.

“We launched our [London to Frankfurt] service at the beginning of October 2012 and sold out by the end of the month. We just went live live with a second round of bandwidth and are nearly sold out,” – Andrew Kusminsky, Perseus.

On reliability:

“We’ve learned how to balance reliability with latency … such as trading firms turning back on forward error correction.” – Snyder. Many variables can be tuned in favour of either lower latency or better reliability.

“Intermittent packet loss is a big issue for market data delivery … packet loss [for wireless] happens but not terribly frequently … a lot of packet loss is weather related … it’s on or off,” – Schonberg.

On rain impact specifically … “Millimetre wave is highly affected by rain … depends on tower spacing … four inches of rain for towers a mile apart. Microwave is better … would take six inches of rain an hour at 10 miles between towers to impact it … and at that point you’re better off getting a boat and two of each kind of animal and getting out of dodge,” – Lawrence, NeXXCom.

On bandwidth and costs:

“As bandwidth increases, cost per bit will come down,” – Lawrence.

“Cost per megabit of wireless vs fibre is substantially higher” – Kusminsky. But cost will come down as bandwidth increases. It’s also usually cheaper to build a wireless network compared to a fibre network.  There is just less bandwidth.

In other wireless related news:

* Quincy Data is providing select data from the Chicago Mercantile Exchange delivered via wireless to Nasdaq OMX’s Careret, NJ co-lo data centre in 4.16 milliseconds, with plans to lower that to 4.06 milliseconds by the summer.  It also is delivering CME data via fibre and wireless to Equinix’s LD4 data centre near London in 36.40 milliseconds.

* Colt Technology Services went live on March 27 with its microwave service – provided by Custom Connect MW – connecting NYSE Euronext’s Basildon, UK data centre, where NYSE’s cash and Liffe derivatives markets are located, with Equinix’s Frankfurt data centre, which houses the Deutsche Boerse and Eurex exchanges.

* NYSE Euronext is looking to roll out its own wireless service within the London metro area, and between Basildon and Frankfurt, leveraging both microwave and millimetre wave technology.

* Strike Technologies is providing wireless network technology to Nasdaq OMX to link it with the CME to deliver market data between the two exchanges.  A one-way latency of 4.25 milliseconds is being quoted.

* TLV Networks has launched a microwave network connecting the CME’s Aurora, Il data centre with the 350 East Cermak data centre in Chicago, where many trading firms continue to operate from because it is less expensive than Aurora, or to optimise multi-market trading strategies, such as CME/IntercontinentalExchange. McKay Brothers also introduced its service on that route, with a roundtrip latency of 370 microseconds.

* Hudson Fiber Networks will offer custom wireless networks to customers in the New York and New Jersey metro area, tapping equipment from ULL Networks.

* 325 Hudson has introduced a managed wireless meet me room at it’s new data centre in New York City.

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