Bear Stearns is bullish on VoIP

At the New York City headquarters of investment firm Bear Stearns & Co, the murmur of hundreds of traders in stocks and bonds can be heard, hunkered down behind their space-age, flat-screen computers and telecom consoles called turrets

At the New York City headquarters of investment firm Bear Stearns & Co, the murmur of hundreds of traders in stocks and bonds can be heard, hunkered down behind their space-age, flat-screen computers and telecom consoles called turrets.

Long used in the financial industry, these turrets from IPC Information Systems are the cockpit for the data, video and voice communications that Bear Stearns traders depend on for decision-making in the high-stakes world of buying and selling in global markets.

In the past, voice lines to the turrets were linked through a PBX. But for a year now, Bear Stearns has entrusted trader activity to voice over IP (VoIP). With VoIP comes a number of critical issues but none more so than being able to monitor and control the network effectively.

For this critical activity, Bear Stearns plugged more than 150 Network Associates Sniffer distributed appliances for protocol analysis throughout its sprawling high-rise Gigabit LAN. It is the largest installation of Sniffer equipment anywhere, according to Network Associates.

Each Sniffer appliance collects the relevant information about call volume, bandwidth usage and traffic patterns, sending it via a second internal LAN. This second LAN was installed strictly for monitoring purposes, running parallel to the primary Gigabit Ethernet LAN.

From this secondary out-of-band network, the Sniffer monitoring data is sent directly over multi-megabit-speed wide-area private line to Bear Stearns' 24-hour network operations centre (NOC) in Whippany, New Jersey

The line is part of a larger gigabit-speed metropolitan-area network (MAN) that Bear Stearns operates in the New York City area on dark fibre obtained from Metromedia Fibre Network and Nortel Networks Optera switches. This MAN acts as a private information superhighway between Bear Stearns' Manhattan headquarters, the investment firm's Brooklyn data-processing facilities and the Whippany NOC.

The NOC is situated in six buildings on a 65-acre site. In one of the buildings, the management data is stored and viewed in real time or for historical purposes at the Network Associates management console, the Network Performance Orchestrator. The purpose is to recognise network slowdowns or other problems that would affect trader operations.

"We do this to define any critical dependencies and be proactive in our monitoring," says Anthony Cellante, director of the IT group at Bear Stearns. He says the Sniffer technology has been a good approach to troubleshooting IP networks and now is starting to be used to analyse application performance as well.

Cellante says the next step will be to take "hoot-and-holler" intercom system that is supported by the IPC turrets and convert that to IP.

Used mostly in the brokerage industry and by utilities, hoot-and-holler is an audio-conference network known since the 1960s to provide dedicated, always-on connections used for two-way business-to-business voice communications.

Typically used to advise brokers on market movement or bark out trading orders, it's a critical element in larger brokerages because its functions, such as a speed-dial-like feature known as "automated ring-down," allow for immediate communication of information to select brokers so they can act upon it in seconds.

Until recently, hoot-and-holler systems have been entirely circuit-switched, which has meant brokerages often had to budget money for their hoot-and-holler networks for long-distance purposes. But using hoot-and-holler over the Internet or a private IP network could result in savings.

"We're looking at supporting hoot-and holler requirement on IP and leveraging the capacity on our intranet," Cellante says.

The early success with VoIP has led to Bear Stearns considering whether to add VoIP in other offices around the world for thousands of other traders.

If VoIP can be expanded to other Bear Stearns offices and to clients, the cost-savings could be substantial, cutting long-distance costs for voice calling and the specialized hoot-and-holler intercom systems.

Meanwhile, the shift to VoIP began when Bear Stearns moved into its new Madison Avenue building last year, installing a Gigabit Ethernet LAN based on Cisco Systems Catalyst switches to be able to handle VoIP traffic loads. The firm swapped out its older circuit-switched IPC TradeNet MX model turrets for the IPC VoIP turrets for the traders.

"It was a fantastic opportunity, starting from the ground up," Cellante says. He declines to discuss the cost of the project, but he says Bear Stearns wants to make broader use of VoIP because in the long term it could lead to cost-savings through not having to buy circuit-switched telecom lines and services.

With the new VoIP turrets, Bear Stearns took the first step to phase out dual maintenance of its data and voice networks, reducing maintenance costs.

And the VoIP turrets brought one benefit that traders wanted -—letting them sign onto any terminal in any office, something that was not possible with the old PBX-based turrets. This "Phase I" of VoIP use was completed last year.

Join the newsletter!


Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

More about CiscoCiscoIPCIPC Information SystemsLANManhattanNortelNortel NetworksSniffer

Show Comments