Following a trend of helping companies make the move from Unix to Linux in the enterprise market, Red Hat ( www.redhat.com) has helped migrate a mission critical component of the Credit Suisse First Boston (CSFB) worldwide financial trading architecture.
“It’s definitely part of our move to the enterprise market,” Red Hat spokeswoman Melissa London tells LocalTechWire of the deal. “We’re seeing a ton of pickup from the top financial firms on Wall
The CSFB announcement came on the heels of Red Hat’s unveiling of its new enterprise network effort just two weeks. The decision was hailed by some Research Triangle Park area Linux users and software developers who see a strong upside for Red Hat and Linux in general in the corporate marketplace.(See www.localtechwire.com/article.cfm?u=399 ).
This latest transaction, in which Raleigh-based Red Hat (Nasdaq: RHAT) received a consulting fee for the software, will allow the global investment bank to save money by running on an open architecture with fewer machines, London says. While London did not disclose any numbers, she says savings will also come in the form of hardware costs by using Intel instead of Sun.
“Basically, what you’re looking at with the Unix-to-Linux migration is a huge cost savings, not just in terms of the open architecture, but in terms of hardware,” London says. “There is a huge amount of cost savings there.” She adds that amazon.com made a similar transition with Red Hat several months ago.
Red Hat stock closed up 23 cents, to $5.24, Monday. That’s still $2 below where it was trading a month ago.
Fewer servers, faster processing
CSFB’s application, called Agora (Greek for marketplace), performs complex financial transactions. It is able to drive thousands of orders, in a matter of seconds, to locations around the globe, including the U.K., Japan, Hong Kong and Korea.
“In an environment of increasing trading volumes and surges in demand, our systems need to be agile,” Steve Yatko, director and chief technology officer of securities IT at CSFB, said in a statement. “We can gain a competitive advantage with a system that is flexible enough to constantly adapt to new business requirements while always improving prices for our customers. Since implementing Red Hat Linux on the Egenera BladeFrame (platform), we’ve noticed significant performance enhancements. Agora has evolved to the point where we are executing record trading volumes.”
Agora’s enterprise notification system, powered by Red Hat Linux, processes roughly 35 million global and 25 million U.S. transactions each day. CSFB converted from a four-way RISC-based architecture to a two-way Intel architecture running Red Hat on an Intel chip. CSFB also will consolidate more than 20 RISC-based machines to only a few Intel processors, which can process up to a half-billion transactions each day per Egenera Processing Blade. CSFB says it has also noticed a 20-time increase in overall performance, in contrast to traditional legacy UNIX systems.
London says that deals like this one with CSFB and amazon.com in the enterprise market reflect a significant difference than those from just a year ago.
“It’s a huge deal,” she says of the deal with CSFB. “Just in terms of the enterprise effort and Unix-to-Linux migration, and what was involved with Red Hat, using all of its services…consulting, support, etc…. to contextualize it. With customers a year ago, like Home Depot, which is a great customer, they were using us to put on point of sale applications. So now, we’re actually seeing big Fortune 500 firms moving as part of company wide cost saving effort.”