Sybase’s acquisition of complex event processing firm Aleri boosts the database management firm’s appeal to securities firms needing real-time analytics to support automated trading strategies and in managing their liquidity, say financial IT analysts.
The move, confirmed Thursday after days of market talk, allows Sybase to better integrate repositories of historical data with huge flows of incoming real-time market data and analysis of complex events and conditions.
“Sybase has done well in core processing of data and managing data in near-real time ,but that isn’t good enough when it comes to analyzing millions of messages a second required in high-frequency and algorithmic trading,” says Larry Tabb, chief executive of New York research firm Tabb Group.”\ “Sybase can now help firms solve a wider range of data challenges.”
In doing so, Sybase will strengthen its hand against competitors such as Microsoft, Oracle and IBM which have also been expanding in complex event processing, aka CEP, says Tabb. Among the three, IBM will be the strongest rival, he contends.
Sybase will also pick up a suite of liquidity management products as well as robust datafeed adapters, graphical user interface, data visualization and developer tools, says Sinan Baskan, director of business development for financial markets for Sybase.
While Sybase had good product development applications, it has lacked tools that allow user to visualize market patterns and quickly dig into what’s going on, according to analysts. Aleri also offers a liquidity management system – widely marketed to banks – which can consolidate data from various internal payment systems. The system enables a bank to model different market events will impact its readily available cash and other cash-like assets.
Sybase’s takeover of Aleri will also increase the value of the remaining independent CEP vendors such as StreamBase, EventZero and Truviso. “It helps build awareness of CEP which is moving providing a competitive advantage to becoming a competitive requirement,” Mary Knox, research director for Gartner’s banking and investment services industry advisory practice in Hillsborough, North Carolina, says.
StreamBase’s president Mark Palmer says he welcomes the challenge from a larger company. “We don’t view it negatively but an indication that CEP is a growth area,” he says.
CEP software permits firms to monitor sizable streams of data in real-time and look for patterns and indicators that require action. The technology is popular in the financial services industry which uses it to make quick trading decisions and to detect risks.
But Baskan also sees a role for CEP and real-time analytics technology in healthcare, telecomm and consumer-based Web sites that experience spikes in traffic, such as eBay and hotels.com.
Last year, Sybase launched its own complex-event processing engine using source code licensed from San Francisco-based Coral8. But, according to the license, the Coral8 code could only be used as an extension to Sybase own analytics platform, known as RAP, which is used in securities trading.
At the time, Sybase said that the combination would enable traders and risk managers to perform real-time analytics on high-speed streams of trade and market data, examine risk and react to opportunities with minimal delays in processing or communications. The technology also allows quantitative analysts to back-test their algorithms using historical data stored in the Sybase platform.
Sybase announced the deal with Coral8 just days after Coral8 was acquired by Aleri. Sybase ultimately ended up competing against Aleri.
Jeff Wootton, vice president of product strategy at Aleri who will now take on the new role of senior director of product management at Sybase, declined to comment on whether Aleri had been on the block or needed additional funding.
None of the financial technology analysts contacted by Securities Industry News said Aleri was in any financial trouble but said that funding from Sybase could certainly help Aleri speed up the development of its new generation CEP platform. Aleri has yet to finish integrating its platform with Coral 8’s in a project code named Ohio and Baskan says that the work will be completed as soon as possible.
Don DeLoach, Aleri’s president, will not stay on with Sybase and will not be replaced. The Aleri business will be integrated with Sybase rather than operate as a separate unit so each of Aleri’s divisions will report into Sybase.
Baskan says that Sybase had made an offer to a majority of Aleri’s employees to stay on but he could not specify how many employees Aleri has nor how many accepted the terms.
This article can also be found at SecuritiesIndustry.com.
Register or login for access to this item and much more
All Information Management content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access