www.smarts.com
Hi ,
If you read the article below regarding Ameritrade and their "Tranformation
of the Enterprise" from Internet Week On-Line last week, and then read the
press announcement attached above relating the fact that Ameritrade chose
SMARTS as their Enterprisewide Event Correlation Partner, I am confident you
will understand why SMARTS(System Management Arts, out of White Plains, NY)
is either installed or being considered by practically every major financial
institution both traditional as well as On-Line.
I know I have sent you information before, but the case being made here by
Ameritrade was just too compelling. Sorry for any inconvenience receiving
this e mail. Everyone to one degree or another has the same concerns as
Ameritrade whether you are an On-Line Broker, Insurance Company or in
Manufacturing. These are problems most shops face in one form or another.
Regards,
David M. Cohn
914 948 6200 x 7455
Transformation Of The Enterprise: Firm Starts To Trade On $100M IT
Revamp
Imagine being at the epicenter of the world's most information-driven
industry, competing in history's fastest-moving business revolution.
Throw in carte blanche management support for IT investments and you
get some sense of the ride Ameritrade CIO Jim Ditmore is on.
As Ditmore approaches his one-year anniversary at Ameritrade, the
brokerage is roughly six months away from completing a $100 million IT
overhaul that will give its online trading service end-to-end
redundancy. The company will have duplicate routing paths, carriers,
data centers-- the whole nine yards.
That huge investment makes sense when you consider that 88 percent
of the brokerage's trading volume comes from Web accounts (1999
revenue was $268 million; first-quarter revenue came in at $111
million). This puts Ameritrade's IT spending on a par with that of E-
Trade, a company with more than twice its revenue, notes Larry Tabb,
an analyst with the Tower Group, a consulting firm that specializes in
financial industry technology.
"While they may not be the size of E-Trade, they need a similar
infrastructure," Tabb says. "Unfortunately, those things don't come
inexpensively."
So far, Ameritrade's site has been free of the outages that have
blemished E-Trade, Charles Schwab and others. Ameritrade learned an
early lesson. Following growing pains in late 1998, including an
inability to deliver up-to-date account balances, it adopted a go-slow
approach to promoting its Web trading services.
The brokerage spent just $60 million on advertising in 1999--well above
1998's $44 million, but well below original plan. With a bulletproof
infrastructure in place, Ameritrade will spend up to $200 million on ads
this year. Since starting more aggressive advertising again in
September, "we've taken the huge capacity increases in stride,"
Ditmore says. Ameritrade averaged 81,000 online trades a day in its
fiscal first quarter, up from 53,000 the previous quarter.
With complete service, equipment and site redundancy in the works--a
back-up data center Ameritrade purchased in Kansas City goes live in
April, complete with DS-3 links to the primary data center--Ditmore's
confident Ameritrade won't disappoint its customers. "From the time a
customer's transaction leaves the ISP, gets to our server and gets
processed, you can have any one component fail, and it will not affect
that particular transaction," he says.
Since arriving from Bell Atlantic, Ditmore has also:
* Pulled Fore routing/switching equipment in favor of Cisco because of
the latter's manageability. Ameritrade will be an all-Cisco shop,
including load-balancing gear, by this summer.
* Stepped up use of a multidimensional database from InterSystems to
present real-time account balances to customers starting this spring.
(Here, Ameritrade is catching up to competitors.) The InterSystems
Cache product was chosen over relational databases because of its
ability to conduct complex queries and present data that spans multiple
accounts and data types. Ameritrade also rearchitected its existing
Cache apps to take better advantage of the database's object
technology and facilitate code reuse.
* Added support for a wireless protocol atop the brokerage's Web site
to support a surging number of customers--about 10,000 today--who
conduct trades from wireless devices.
Ameritrade's avoidance of costly, embarrassing outages has
undoubtedly been part good fortune, part robust site design. With the
steps Ditmore is taking, luck should cease to be a big part of that
equation. -- Tom Smith
Ameritrade Final1.doc
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