Traders opting for VoIP

A trading floor novelty five years ago, voice over Internet protocol.

A trading floor novelty five years ago, voice over Internet protocol (VoIP) technology is now installed in about one out of every three trading organizations, providers of VoIP estimate. And its adoption keeps growing. Using Internet conventions over dedicated communications lines, VoIP lets users combine voice, data and video -- and it’s less expensive to operate than the time-division multiplexed (TDM) systems widely in place.

A study released last month by London-based British Telecommunications, a supplier of desktop trading consoles, or turrets, and Finextra, a London-based financial technology news service, found that more than half of the trading organizations they polled that do not have data- and voice-converged VoIP in place plan to implement such a system within three years.

New Yorkbased IPC Information Systems, a maker of mission-critical communications equipment that introduced VoIP turrets in 2001 and installed its 30,000th unit last year, says that 85 to 90 percent of the desktop trading systems it ships are now VoIP-configured. IPC’s latest turret, scheduled to ship in June, will be entirely VoIP, although the company says it will continue selling turrets that work on TDM voice networks.

Jonathan Morton, director of global customer solutions at IPC, says VoIP systems, which are comparable in price to TDM systems, offer greater flexibility, enhanced compliance and better business continuity.

“Take the avian flu threat,” Morton says. “Firms could let their employees work from home with soft turrets on their PCs connected to the main switch at headquarters. Traders could even tuck the turret under their arms and take it home to a broadband connection and still have all their conversations recorded.”

BT says the speed with which trading firms shift to VoIP depends on the risks involved in migration. “The issue is whether the customers’ network is robust and stable enough to support voice and share it with the data environment,” explains Peter Skoglund, director of product management.

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