Eugene Grygo, Chief Content Editor, FTF News
Something interesting is underway as far as cloud computing and securities operations — the Amazon Web Services (AWS) offering has been quietly gaining ground after some initial resistance.
I recall that the main concerns about using the AWS cloud revolved around compliance and security.
But Amazon zeroed in on the compliance and security demands and concerns of the securities industry by putting out a document that offers an overview of how AWS meets the regulatory requirements of the SEC’s Office of Compliance Inspections and Examinations (OCIE).
“The document is to be used by AWS securities industry customers, their examiners, and advisors to understand the scope of the AWS services, guidance for implementation, and examination when using AWS as part of the financial institutions environment,” according to the Amazon paper.
One by one financial services players are anointing AWS. Nasdaq OMX, the Financial Industry Regulatory Authority (FINRA), Aon Benfield Securities, Inc. and 8 Securities (in Hong Kong) have all become fans of the AWS cloud environments.
Most recently, the DTCC, the industry’s post-trade infrastructure utility hub, gave its blessing to AWS in mid-July with the announcement that Avox Data Services, the DTCC’s legal entity reference data arm, migrated its data servers to AWS.
Moving from on-premise IT support to AWS servers for cloud computing “is part of a company-wide initiative to implement innovative new technologies that will increase scalability, further enhance the security of the data and reduce costs —three of the most widely-recognized benefits of cloud computing,” according to a DTCC statement.
The DTCC’s engineers, programmers and developers were looking for new ways to leverage technology-based solutions to “enhance the client experience,” explains Donna Milrod, managing director and head of DTCC Solutions. “With this in mind, DTCC built a post-production environment in the AWS Cloud, combining the very best of human expertise with available technology,” Milrod says in a prepared statement.
The DTCC expects that Avox Data Services, which is integrated with the Clarient Entity Hub, the GMEI utility and Omgeo Alert, will benefit from the AWS 24/7 support and it will leverage the DTCC’s utility model.
The big difference is that the cloud allows the DTCC to no longer be “bound by the physical constraints of equipment or software,” says Mark Davies, managing director at DTCC Europe and General Manager of Avox Data Services.
“Cloud technology opens up engineering opportunities, turning once difficult, time consuming tasks into solutions that can be achieved in near real-time. We’re in the proof-of-concept stage on a variety of fintech initiatives and this migration will make that evolution much easier. If they prove to be successful, our aim is to drive further innovation for DTCC and our clients in the years ahead,” Davies says in a statement.
The DTCC may expand its use of the AWS Cloud “across its various applications,” officials say. “In another use case, DTCC recently leveraged AWS for real-time swaps data reporting — a major achievement that has saved the firm significant resources by eliminating the need to buy, build and maintain internal servers, storage and security structures, and ultimately reduced costs for users.”
My guess is that there are many major players that are contemplating or have already signed on to the AWS cloud. This will provide firms with more options and a more leverage when dealing with other cloud computing providers.
Five years after the hoopla and the cloud is finally living up to its hype.
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