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Vhayu ‘Central' to Reuters Tech Strategy |
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Inside Market Data
08/10/2009 |
Thomson Reuters is to make Vhayu's Velocity tick database available as a hosted service, as well as using it to provide a key component of its next-generation "common platform" data desktop, following its purchase of the Los Gatos, Calif.-based tick data management and complex event processing software vendor last week for an undisclosed sum.
The move cements a four-year reseller agreement between the two vendors, whereby Thomson Reuters sold a version of Velocity, rebranded as the Reuters Tick Capture Engine.
Michael Parlapiano, global head of strategy and business development in Thomson Reuters' Enterprise division, says the vendor decided to acquire Vhayu in order to accelerate the integration of more content APIs into Velocity, thus reducing the deployment and integration burden for clients, and to create a much closer relationship to govern custom development that Vhayu is performing in relation to the common platform and other internal Thomson Reuters uses of Vhayu's technology.
"Over time, Vhayu's technology has become more central to us, so having an ‘arms-length' relationship wasn't suitable anymore," he says.
Vhayu chief executive Jeff Hudson says the takeover will make it easier for Thomson Reuters to use Vhayu as part of more strategic internal applications, and also for other departments to use the technology, since the vendor will no longer have to operate under a commercial, fee-liable relationship. "Going forward, we see this becoming a vital part of many parts of the organization," he adds.
Vhayu engaged New York-based investment bank Marlin & Associates to help sell the company earlier this year. But Hudson denies there was any pressure from its backers-including Menlo Ventures, Garage Technology Ventures and Silicon Valley Bank-to cash in their stakes. Instead, he says the deal was driven by strategic opportunities created by the current economy, which has forced clients to switch from highly leveraged to less-leveraged models, and reduce their integration spend.
"They want to focus their spend on algos and leave the heavy lifting to someone else," Hudson says. "The next step... will require high integration with content, and to do that as an independent company is harder, more costly, and you won't get such tight integration, whereas we had already done some integration projects with Reuters.... As part of Thomson Reuters, the resources, content and what we need to get to the next level of offerings is something that others will be hard-pressed to do on their own."
Thomson Reuters will use Vhayu to power the charting, analytics and pre-trade modeling functions of its next-generation platform, but will also continue to sell the tick database as a standalone product- either integrated with Thomson Reuters data, or as an open system able to accept data from other sources-and plans to make it available as a managed service alongside the vendor's hosted direct feed and hosted RMDS offerings.
"We already have a historical tick service that delivers tick history as a file on a T+1 basis. This will enable us to do that intraday, in a hosting center," Parlapiano says. "It lets us add a new set of services... that are fully integrated and available as part of the RMDS stack."
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