Thomson Reuters Corp launched a global, high-speed network on Tuesday for financial firms to access real-time data as well as share information with each other directly.
The company's new network, called Elektron, includes hosting centers in New York, Chicago, London, Frankfurt, Tokyo and Singapore, with more to come in Hong Kong, India and Brazil later in the year, all connected by a fiber optic ring.
The company is operating the system in partnership with data center company Savvis Inc.
As trading decision are made increasingly by computers, the difficulty has been to execute ideas at high speed that require trades in multiple markets, said Jon Robson, president of Enterprise arm of Thomson Reuters.
This provides the infrastructure, technology and connections to different markets so that trades can happen quickly, he said.
Elektron will provide any Thomson Reuters client of any size equal access to high-frequency markets, Robson said.
It will also serve as a neutral distribution platform for participants to exchange research, prices, business ideas or transactions, he said.
Thomson Reuters plans to migrate all of its content to Elektron over time as well as use its greater bandwidth to add deeper levels of market information, Robson said.
Larry Tabb, chief executive of research and consultancy firm TABB Group, said the Elektron system changes the whole paradigm of how people receive and deliver information.
It allows people to communicate more seamlessly, who would otherwise have to rely on slower channels or somebody remembering who gets what, he added.
High-frequency traders currently install servers of their own next to an exchange's server at hosting centers, known as colocation, to get rapid access to data and high-speed trading.
This will be fairly close to what exchanges can provide but it will be an integrated set of data across exchanges instead of colocating at each exchange, Tabb said.
In a marketplace where competition is focused on high speed information, known as low latency, this is a logical move for Thomson Reuters, said Sang Lee, managing partner specializing in market structure at consultants Aite Group.
Such a network has the potential to create a sense of community over the long term, with customers exchanging trading ideas and business opportunities, Lee said.
It's all about building trust. It's an interesting concept, he added.
(Editing by David Cowell)