Thursday, 27 July 2017

Four ways that programmable networks help financial enterprises compete in today’s global markets

A Knowledge Network article By Matthew Lempriere of Telstra
Monday 10 July 17

Financial Service firms that want to stay competitive in today’s globally connected markets face a number of network challenges. With an increasing focus on digitisation, demand for bandwidth continues to grow as data proliferates. Clients, counterparties and trading venues are diverse and dispersed. A multitude of technologies, running across multiple platforms, based on a variety of protocols, need to be connected to each other. In addition…

Financial Service firms that want to stay competitive in today’s globally connected markets face a number of network challenges. With an increasing focus on digitisation, demand for bandwidth continues to grow as data proliferates. Clients, counterparties and trading venues are diverse and dispersed. A multitude of technologies, running across multiple platforms, based on a variety of protocols, need to be connected to each other. In addition, many firms are reluctant to spend too heavily on network infrastructure, and the need for security is ever greater as cyber-threats continue to grow.

The legacy network infrastructure in place at many financial enterprises is often poorly positioned to meet these challenges, subject as they are to manual provisioning, reliance on physical hardware, and time-consuming setup and maintenance. Not only that, but extensive fixed-term contracts make it difficult for enterprises to quickly modify their networks when reacting to changing business needs. In short, such network inflexibility can severely impact a firm’s ability to compete with more agile Fintech companies that are now proliferating.

This is why a number of banks, investment firms and other financial market participants are turning increasingly towards programmable networks. Consisting of services such as Network Function Virtualisation (NFV), Software-Defined Wide Area Networking (SD-WAN), Data Centre Interconnect and Cloud integration, these programmable networks offer a wide range of benefits over legacy infrastructure.

Agility

By allowing banks and other financial service firms to re-define the structure and connection points of their wide-area networks on demand to meet changing customer and business needs, programmable networks enable firms to be more agile so they can rapidly develop new products and services. This is backed by research Telstra commissioned from The Economist Intelligence Unit (EIU) on Asian digital transformation, which polled more than 100 senior financial industry executives across 11 countries in Asia last year. The study found that digitisation is helping financial service providers in Asia to expand their reach into new markets, generate more innovative ideas for new products, and to develop new customer segments.

The fact that data centres in key locations can be interconnected is another example of how such networks can facilitate rapid entry into new geographies and new markets.

Fast provisioning

The ease and rapidity with which programmable networks can be provisioned, and the fact they are not reliant on specific installations of physical hardware, allow financial enterprises to quickly deploy and market-test their new services and products, without prohibitive lead times for network provisioning.

Control

As programmable networks are software-defined, network assets and resources can be centrally controlled, allowing bandwidth to be dynamically ramped up and down as needed to satisfy customer demand – all with the necessary security layers automatically configured.

Capital Efficiency

The virtual, “as-a-service” nature of programmable networks means that banks can move away from the high capital costs that traditional network infrastructure incurs, and toward a capital-efficient OpEx model. With technology trends increasingly moving toward virtualisation, agility and automation, programmable networks are becoming essential for banks, brokers, trading firms, investment managers and other financial enterprises who need to compete in today’s globally interconnected markets.

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