NYSE Euronext Plans Global Trading Hubs

NYSE Euronext (NYX) plans to expand its infrastructure to add a point of presence in 25 to 40 data centers around the  world.  This network will extend NYSE's two new major data centers and appears likely to boost colocation providers such as Equinix, Savvis and Telx Group.

Data center strategy – Phase 1

In September 2009 NYSE outlined details of its data center plans and the massive 400,000 square foot primary facility it was opening in Mahwah, New Jersey.  Later last year NYSE Technologies and co-global CIO of NYSE Euronext Stanley Young said that they were becoming a ‘fabric player’ where they allow industry participants to meet virtually.  This was part of a plan where approximately 80 percent of the space in their primary data centers (Mahwah and Basildon) could be leased to trading firms seeking high-speed access to their matching engines. The other major NYSE owned and operated facility is in Basildon, just outside of London, and opened in May 2010.

Data Center Strategy - Phase 2

Fast forward one year to 2010 and NYSE reports that it has sold out the available colocation space in the first phase of Mahwah facility. NYSE Euronext now says it will extend the reach of its low-latency trading operations and develop ‘liquidity hubs’ in smaller financial centers including Frankfurt, Tokyo and San Paulo.  The expansion is already under way and 14 European locations are seen coming online in the first quarter of 2011.  As the company ramps up services, it will focus on markets such as Chicago, Frankfurt, Singapore, Brazil, Hong Kong and Tokyo.

To deploy these distributed liquidity hubs, NYSE Euronext will turn to colocation providers such as Equinix (EQUIX), Savvis (SVVS) and Telx Group.  This alleviates the need for them to build their own facilities in each smaller market.  Some locations may just collect data, while others could be miniature versions of their primary New Jersey and London sites.

Mahwah press

60 Minutes was able to get a look at the illusive Mahwah facility once it opened.  Grubb & Ellis also had some interesting trivia recently regarding colocation and the NYSE Mahwah facility.