A new report reveals a growing need for centralized communication platforms in finance and insurance. Firms face mounting regulatory fines, seeking efficiency and compliance through channel aggregation.
Keeping up with cloud evolution
For better or worse – and perhaps like it did across all business sectors – the pandemic accelerated many of the financial services industry’s underlying trends. Overnight, almost everything was instantly propelled forward. Practices that have been holding the industry back seemingly forever – such as users’ reluctance to adopt technologies that would disrupt entrenched practices, or the way enterprises manage their resources and technology stack – suddenly shifted into high gear. Change became an urgent necessity.
As a business spearheaded by experienced ex-traders and trader voice industry veterans, Cloud9 is engaged in a constant dialogue with customers to shape and lead the way in the trader voice technology industry. This dynamic, in-depth knowledge sharing revealed a few features that kept coming to the fore as part of the market’s accelerated evolution in the aftermath of COVID.
The Cloud Era Has Arrived
We are now living in the cloud era.
At home, we store our personal data and working files in the Cloud for convenience and easy retrieval across devices. At work, after being initially hesitant to do so, many enterprises of all sizes are now fully embracing the benefits of the Cloud. This trend can be seen by Google’s recent decision to expand their investment in cloud regions as the tech giant added three more Asia Pacific regions – Malaysia, Thailand and New Zealand – to join Google’s 34 cloud regions currently in operation around the world.
As the Cloud expands geographically and deepens functionally, firms find its potential increasingly compelling.
“When we need to expand or set up new offices as our business strategies or needs evolve, Cloud9’s trader voice platform’s scalability and ease of setup shine compared to other solutions we have looked at. We appreciate the fact that it is a cloud-based voice communications platform that, by enabling us to start doing business quicker and connect to our counterparties faster, gives us a business advantage in these markets” said Eric Rabot, CEO at OTCex Hong Kong.
In addition to providing higher security and data residency, cloud solutions allow enterprises not only to remain agile, but also to maintain low latency while facilitating compliance (including specific data storage requirements). With APIs covering everything from data extraction and voice integration to operational overview and analytics, cloud solutions can deliver a cutting-edge turn-key ecosystem that empowers financial firms to focus on what they do best – investment and trading.
Digitalizing voice communication in trades
From the increased adoption of electronic trading across multiple asset classes to long-time communication practices in voice trading taking on a new spin, modernization is inevitable as the digital age unfolds.
Gone are the days when we had to pay for each private wire connection and go through the friction and time of trying to set up a line between parties. Of course, many firms of various sizes are still running on old technologies and systems, but the reality is that cloud-based systems can be deployed at significantly lower cost than traditional turrets, providing higher efficiency and effectiveness. In speaking with the head of multi-asset trading at one of our buy-side clients, he believes it is more expensive to stick with legacy systems than it is to transition to cloud solutions. It is a matter of time that most firms will make their transition with the limited upfront commitment, ability to work from anywhere and overall improved functionality and analytics, not to mention the sheer growth of counterparties now online especially with Cloud9’s community.
Cloud9 trader voice solution has been designed from the beginning as a software-first turret application (with USB compatible turret-like hardware) that can run optimally across Internet/Wi-Fi connections and various work devices such as PCs, laptops, and tablets. This means that Cloud9 works well not only in the office, but also at home by giving users a seamless and reliable work-from-anywhere experience. At the height of the lockdowns, Cloud9 enabled thousands of Cloud9 users from many banks to seamlessly work from home and keep business running smoothly. When Cloud9 was rolled out as the default office turret solution for a global bank, the head of equity trading who worked with us on the project appreciated that they could continue accessing their trader voice connections seamlessly as if they were in the office, even when working from home or traveling overseas for an extended period during the pandemic.
As firms now recognize they can operate securely within a cloud hosted environment that delivers economies of scale and cost savings, the next question is who else is there? To trade, firms need ready access to a directory of counterparties that are also online and can be reached instantly via a ring, shout, or a hoot. The reality is that more firms are moving on the Cloud as are exchanges like CBOE, which just launched an hybrid open outcry trading floor to accommodate the increasing number of trading firms opting for cloud-based, flexible work-from-anywhere set-ups. When it comes to voice communications trading, we are seeing the network effect of Cloud9’s community increasing fast and becoming a compelling value proposition for users.
The rush to refresh tech stack
With the pace of technological change accelerating further, firms saddled with aged and potentially obsolete proprietary solutions run the risk of being left behind as nimbler competitors leapfrog to the best available technology.
Firms that transition to efficient cloud solutions can stay ahead of their peers by being technologically flexible enough to meet evolving regulatory requirements or trade capture and reporting obligations. Such a plug & play model also allows firms to react instantly to changing conditions, such as those they faced with the Covid-19 pandemic – which, by forcing employees to work from home, sent firms scrambling for compliant, cost-effective solutions that could deliver secure voice recording and clear metadata tracking for a suddenly mobile workforce, all within a secure, comprehensive ecosystem. “At this stage, what matters is to invest in the type of infrastructure that can support the new normal. This means more agility, efficiency, and flexibility with little up-front or long-term commitments. And that’s what cloud solutions can deliver” said Chris Judson, Chief Information Officer at Liquid Capital Australia. In addition, the Cloud’s built-in flexibility also gives firms the ability to seamlessly scale up or down as business priorities change.
There’s no turning back
To paraphrase Hemingway, technological change occurs in two stages: gradually, then all of a sudden. As new technological tools ranging from AI and big data to machine learning and cloud computing become increasingly cheaper and more powerful, financial firms are keen to explore new pathways to drive revenues and establish new competitive advantages. The pandemic highlighted the importance of cloud-based solutions, and an increasing number of forward-looking firms are now looking at solutions like Cloud9, as we partner with them, helping them navigate the new voice communications trading landscape in a nimble and compliant manner. The goal is the same across all clients: to future proof their business by focusing on their core activities. This means designing profitable trading strategies seamlessly executed by highly skilled employees wherever they might be located while using the best technology available on the market.
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