The New York Stock Exchange is laying off staff--with the biggest reductions hitting its tech employees--and former Archipelago exec Jerry Putnam is swinging the axe. About 100 technology staffers have been let go in the past two months and cuts are expected to continue there and elsewhere at the exchange as part of a plan to slash $100 million in spending this year.
Putnam is in charge of integrating Arca's trading platform and tech staff with the Big Board's. NYSE, with about 1,000 tech personnel, has the most redundancies. Other personnel receiving pink slips this month include general operations staff--such as human resources, NYSE insiders said. Putnam did not return calls and a spokesman declined to comment.
"It's bad news for a lot of [NYSE] technology people. Many are worried," one tech staffer said. Among top officials whose positions have been eliminated are David Bartges, head of NYSE technology infrastructure, and Joseph Rosen, head of technology marketing. Chief technology officer Roger Burkhardt was the first to go in April. Rosen declined to comment: the other former staffers did not return calls.
Technology personnel are targeted because NYSE has already built most of its hybrid trading platform. Archipelago's existing technology will be used for other major trading initiatives and Arca staff--roughly a tenth of the size of NYSE's--is being retained to monitor it. "Arca's staff is so small and it's their technology; that's why NYSE is hit the hardest," an insider said.
Greater reliance on Arca's existing technology means that the Securities Industry Automation Corporation, an 800-strong NYSE subsidiary that builds technology for the NYSE, the American Stock Exchange and brokerages, will become less significant. SIAC's revenues--which represent about 16% of the exchange's quarterly revenues--have been falling for several years because many brokerages have moved on to cheaper vendors.
SIAC's revenues were about $97 million in the first quarter, down from $107 million from the fourth quarter of last year. Revenues are expected to fall further because Amex--whose fees make up about a third of SIAC's revenues--wants to run its own technology. NYSE officials say the Big Board wants to streamline it and cut out extra expense.
In that regard, NYSE is handing SIAC officials more responsibilities. Marianne Brown, head of SIAC, has been given NYSE technology to oversee along with CTO Steve Rubinow--who came over with the Arca acquisition. Tom Demchak, executive v.p. at SIAC, has been assigned Bartges' infrastructure responsibilities. Rosen's responsibilities have been handed down to several people that could not be discerned by press time. Brown, Rubinow and Demchak declined to comment.
