If the new team, which includes Larry Leibowitz, chief operating officer, had hesitated on the project in early 2008, Niederauer thinks any sensible board would have held up the investment until a deep recession proved to be over. Instead, NYSE Euronext has been building out its capabilities during the recession while its competitors "were licking their wounds."
He adds: "If the rest of the world was playing offense while we were doing this, we would have been hurt," he said.
Instead, he projects that NYSE Euronext will have lower IT costs in 2011 than it does this year, as the 12 aging data centers, many of which came with various acquisitions, are phased out.
Part of the transformation has come about through ties Niederauer has to technology companies in the Silicon Valley. He named HP, Juniper Networks, supplier of high speed routers; Force 10, supplier of 10-Gigabit Ethernet switches, Ciena, unified network specialist; and AboveNet, supplier of high-speed trans-Atlantic networking, as technology advisors and partners in modernizing the NYSE.
On a visit to the San Francisco Bay area March 8-9, Niederauer had breakfast with HP's Mark Hurd, gave a talk on the new NYSE at the Silicon Valley Bank, rubbing elbows with those who do business in the valley. It's a far cry from the New York-centric pattern of his predecessors.
"For years, NYSE abdicated its opportunity to work with these companies," he noted. When he was appointed CEO, it had been 15 years since NYSE had considered revamping its data center. "Three years ago, they wouldn't have thought of us as a technology partner. They'd have said, 'You're not a technologically proficient exchange."
With its new data centers and acquisitions, such as Euronext in 2006, a set of European exchanges headquartered in Paris, and the Amex exchange in 2008, NYSE is set to move onto a global stage where a healthy share of the world's equities trading -- currently one-third -- will pass through its systems.
"If a bank wants to trade for its customers around the world on 50 different exchanges, why should it pay 50 fees for the privilege? Why doesn't it just pay one fee to NYSE?" he suggested.