NYSE places buy on Linux, hold on Unix

Exchange builds server base for hybrid trading system on x86 hardware, open-source OS

The New York Stock Exchange is investing heavily in x86-based Linux systems and blade servers as it builds out the NYSE Hybrid Market trading system that it launched last year. Flexibility and lower cost are among the goals. But one of the things that NYSE Euronext CIO Steve Rubinow says he most wants from the new computing architecture is technology independence.

"What we want is to be able to take advantage of technology advances when they happen," Rubinow said. "We're trying to be as independent of any technologies as we can be."

The Hybrid Market system lets NYSE traders buy and sell stocks electronically or on the exchange's trading floor. The NYSE has been turning to x86 technology to power the trading system, largely using servers from Hewlett-Packard Co., the two companies announced this week.

The NYSE has installed about 200 of HP's ProLiant DL585 four-processor servers and 400 of its ProLiant BL685c blades, all running Linux and based on dual-core Opteron processors from Advanced Micro Devices Inc. In addition, the stock exchange is using HP's Integrity NonStop servers, which are based on Intel Corp.'s Itanium processors and run the fault-tolerant NonStop OS operating system, as well as its OpenView management software.

Rubinow said that Linux is mature enough to meet his needs. The open-source operating system may not have all the polish of Unix technologies with 20-plus years of history behind them, "but it's polished enough for us," he said.

The NYSE's shift toward Linux and x86-based hardware illustrates why consulting firm Gartner Inc. is predicting a slight decline in Unix server revenues over the next five years. In comparison, Gartner forecasts strong sales growth for both Windows and Linux servers.

Although Rubinow has the option of using HP-UX, HP's version of Unix, he said that he'd prefer not to. "We don't want to be closely aligned with proprietary Unix," he said. "No offense to HP-UX, but we feel the same way about [IBM's] AIX, and we feel the same way to some extent about Solaris."

The NYSE still runs numerous Unix systems, especially ones with Solaris, which is Sun Microsystems Inc.'s Unix derivative. Rubinow acknowledged that Solaris has the ability to run on multiple hardware platforms, including x86-based systems from Sun server rivals such as HP. But he added that he thinks Linux "affords us a lot of flexibility."

One technology that the NYSE isn't adopting so eagerly is server virtualization, which comes with a system latency price that Rubinow said he can't afford to pay. In a system that is processing hundreds of thousands of transactions per second, virtualization produces "a noticeable overhead" that can slow down throughput, according to Rubinow. "Virtualization is not a free technology from a latency perspective, so we don't use it in the core of what we do," he said.

Charles King, an analyst at Pund-IT Inc. in Hayward, Calif., believes there is a broader concern among IT managers about virtualization overhead and its impact on transaction processing. "It's one of the reasons why even the staunchest advocates of x86 virtualization recommend extensive testing prior to moving systems into production," King said.

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