Brokerages Put Plenty of Stock in Wireless Devices

By Matt Hamblen, Computerworld |  Networking

Schwab's Nasos Topakas says wireless devices aren't too vulnerable: "If something happens and I miss it, then I just disconnect the service"


But San Francisco-based Schwab is back in the running as part of an aggressive pack of companies offering wireless trading, Kountz said. Its wireless access is part of an integrated system that includes telephone brokers and online services that allow customers to see entire spreadsheets of portfolio data on a desktop screen, said Jonathan Craig, vice president of marketing for global wireless at Schwab.

The attitude at Schwab is very much toward using wireless to supplement other services, said Craig.

Unlike Fidelity, which built its wireless applications in-house because integrators didn't have the needed expertise at the time, Schwab built only some pieces - including the user interface - in-house. It hired Aether Systems Inc. in Owings Mills, Md., to bring the service to handhelds from Santa Clara, Calif.-based Palm Inc. and pagers from Waterloo, Ontario-based Research In Motion Ltd., said Nasos Topakas, vice president of global wireless technology at Schwab.

Three Major Challenges

The three biggest challenges in wireless facing brokerages today are the interface, how to work with the various carriers in the U.S. and how to build adequate security. And none of these has proved to be as difficult as it first seemed.

The carrier problem seems to be solving itself, with recent mergers resulting in nationwide service helping to expand coverage quickly. The hodgepodge U.S. market has benefits, too: Having a number of carriers has "turned out to be an advantage for us because it gives us a broader customer base," said Glenn Tongue, president of DLJdirect Inc. in Jersey City, N.J.

Ameritrade Holding Corp. became the first brokerage to operate over a nationwide wireless phone network in November of last year, using the expertise of Sprint Corp., said Jim Ditmore, CIO at Omaha-based Ameritrade. It's able to administer all of its carrier relationships with only three in-house technology staffers by keeping all the business logic for how to make a trade the same and changing just the presentation layer for the various wireless handheld devices, said Ditmore.

Maintaining an entire silo of wireless business-logic components would mushroom the staff to 30 people, Ditmore added. Ameritrade has 10,000 wireless users, representing less than 1% of its 1.2 million online users.

Security hasn't been a problem either. The lapse in Wireless Application Protocol 1.1, in which data was momentarily decrypted at the gateway before being encrypted again, theoretically exposing it to hackers, apparently hasn't slowed adoption and is being fixed in Version 1.3.
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