February 26, 2008

Can Marketcetera be viable competition for Charles River and LatentZero ?  Interesting that their website makes no mention of the “sell market data and trading services” strategy that Matt Asay details. They would appear to be following an interesting variation of classic platform strategy a la Ferguson. Except in this case they’re not commoditising the layers below. They’re attempting to commoditise the layer above – the OMS – then lock clients into the layer below – the market data and services. It will be interesting to see how they execute on this novel strategy.


2 Responses to “Marketcetera”

  1. John Greenan Says:

    Interesting question. Here’s the question that you have to consider. How many buy-side institutional asset management firms actually buy into free and open source software?

    An open source OMS has been proposed in the past

    But, buy sides hate paying for market data – I cannot see that paying for market data will fund this. And I don’t see what their point is “take our market data or the system does not work as well”. That’s not a great sales pitch…

    I wonder if really these guys are trying to take a project they built for a hedge fund and then use it as the base for consulting engagements?

    Interesting, but if these guys think that they are competing with Flextrade they are in for a shock.

  2. @John Greenan
    (Disclosure: I’m a founder of Marketcetera)

    Just ask JBoss 5 years ago how many Fortune 500 companies would buy into free and open-source software. At the time, maybe 8%. Now they have 60% market share in the application server business. It’s a process, and we’re working on education.

    Right now, what we’re hearing from our customers is that the flexibility, and lack of lock-in to proprietary vendors is extremely valuable. We are currently developing a set of third-party data feeds, and the Marketcetera offerings will complement those.

    I don’t think it’s true that buy side firms hate paying for market data. Insofar as they soft-dollar everything, it may not appear that they are paying for it, but I guarantee that they are (probably more than they should be).

    Finally, to answer your question, we come from the buy side, and had looked for a project like Marketcetera, finding none, we built it. It’s a true open-source project. Come see for yourself.

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