High-frequency traders use 50-year-old wireless tech

High-frequency traders are turning to legacy microwave technologies for faster communications

By , IDG News Service |  Mobile & Wireless

Based on the speed of light, the theoretical limit for sending information between New York and Chicago is 7.96 milliseconds. Right now, the state-of-the-art among microwave service providers is about 8.5 milliseconds, Persico said, noting how different providers are trying to secure the fastest rights-of-way and are developing technologies with the lowest latencies, all in an effort to offer the fastest sub-millisecond services for financial firms.

"We've been looking at [microwave technologies] for about a year now, in both Europe and the U.S.," said Ian Jack, head of the U.S. infrastructure business for the New York Stock Exchange, during a panel discussion on the topic. "We're looking at what the vendor community is doing and trying to leverage that as much as possible."

Performance is still a big factor, Jack said. Performance "is one of our big challenges as a potential buyer. If you look at the actual uptime for services, it's not brilliant. Every vendor has a new change, a revelation just around the corner, but we have yet to see that."

Rain can hamper performance with microwave technologies. So can low-lying clouds. "Interference can bring an entire network down, and you don't have that with fiber-optic networks," Persico said. He noted that, eventually, microwave technology vendors will compete more on how robust their networks are, once they offer approximately the same latency times.

Joab Jackson covers enterprise software and general technology breaking news for The IDG News Service. Follow Joab on Twitter at @Joab_Jackson. Joab's e-mail address is Joab_Jackson@idg.com

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