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Telx Clifton Campus…A Game Changer for Capital Markets

May 20, 2013  |  Written by Shawn Kaplan

The June 19th Grand Opening of Telx's new flagship campus in Clifton (NJ),will mark an exciting time for Telx and for the Financial Technology industry as a whole. Already a key financial colocation facility, the existing 100 Delawanna datacenter houses exchanges, buy-side, sell-side, and HFT shops from across the world's financial markets, but it was lacking some of the "pizzazz" of other centers in the area. About a year ago across the parking lot from 100 Delawanna, Telx broke ground on a new 215,000 sq. ft flagship datacenter—a state of the art facility Telx insiders have been affectionately calling the "Taj Mahal" of datacenters. Telx has now encased both buildings in perimeter fencing and high-tech security systems…establishing the Clifton Campus as the next hot financial ecosystem.

But why will the new Telx Clifton Campus be so important to the Financial Services markets?

The Capital Markets are under severe profitability pressures, driven by increased regulations, increased trading complexity, and reductions in commissions. This perfect storm of margin zapping dynamics is causing firms to re-evaluate their IT spend and cost basis. The Telx Clifton Campus was originally designed to be a lower TCO alternative to the typical Telx carrier hotels at 111 8th Avenue, 350 Cermak, and 60 Hudson Street. By leveraging LEED design criteria and highly efficient datacenter design techniques, Telx is able to hit a very aggressive price/performance ratio compared to the exchange colocation facilities. This efficiency in itself makes NJR3 an ideal location for back-testing engines, back-office systems, development and other trading support systems. And because essentially every dark fiber provider has already built into the NJ campus, the cost and complexity of connectivity back to other area datacenters is quite low. Telx itself has even established a dark-fiber ring which allows clients to install a "virtual cross-connect" between Clifton and destinations in 111 8th, 300 Boulevard East, and 60 Hudson.

But here's where it gets more interesting: In February of 2013, the NYSE opened up its doors to carriers other than its proprietary SFTI network which had previously been the only way in and out of the building. It just so happens that the fastest fiber route between the NYSE Mahwah datacenter and the other equity exchanges ran directly behind the Telx Clifton campus. And it also turns out that Telx sits precisely between the two leading equity markets, NYSE and NASDAQ, making Clifton not only a lower cost trading hub, but also a low-latency proximity hub for the financial markets.

But not everyone in Financial Services needs low-latency connectivity. Most long/short hedge funds, regional banks, wealth advisors, asset management firms, and card payment systems care more about reliability and security than trading performance. Many firms are still locating their datacenters inside of their corporate offices in Manhattan or New Jersey. But seldom does good office space also make good datacenter space…in fact, almost never. Hurricane Sandy showed us just how fragile many firms Business Continuity plans really are. Regardless of whether datacenters actually experienced outages, firms learned very quickly the fragility of their server rooms. Even several of the "professional" datacenters found out the hard way that they are located inside of the FEMA 100 year flood zones and are powered by single electrical sub-stations which themselves can be fragile. The Telx Clifton Campus is one of only a very few Tier III Certified facilities in New Jersey, is powered by two independent substations, and is importantly located outside of not only the 100-year but 500-year flood plain, making it one of the most reliable facilities on the market.

June 19th will indeed mark an exciting time for Telx and will bring an interesting new alternative to Financial Services companies. Whether you're primary drivers are security, reliability, cost, or performance, with its new NJR3 data center, Telx has  really hit the mark!