S1 Embraces Linux

Financial-services companies find Linux's lower operating costs attractive, but they need scalability and security assurances.

Steven Marlin, Contributor

November 16, 2004

2 Min Read

S1 Corp., a maker of online banking and other front-office applications for financial institutions, plans to offer Linux versions of its software by 2006. The company, whose products power customer-facing functions at 4,000 banks and insurance companies, wants to stay ahead of the curve as banks are intrigued by the open-source operating system's possibilities for dramatic operating cost reductions.

A lot of S1's overseas customers are already moving forward with Linux-based initiatives, and domestic customers are beginning to follow suit, says Rob Young, VP of product management and strategy at S1. Linux is being viewed "as a viable platform for heavy-duty production environments," he says.

Migrating S1's software, which is based on Java 2 Enterprise Edition, to Linux doesn't present a formidable technical challenge, Young says. But the vendor wants to be sure that S1 applications on Linux meet customers' security and scalability requirements. "The actual physical port isn't a major undertaking, but we want to be sure we've got everything rock-solid," Young says. S1's teller applications will be the first to be migrated to Linux, according to the company.

S1 isn't a Linux neophyte. The vendor already utilizes several versions of Linux in its own data center, which hosts S1 software for many banks. And Mosaic Software, an automated-teller-machine application company S1 recently acquired, already offers Linux versions of its products. It plans to implement a Linux-based system at a Midwestern bank early next year.

Linux is already making inroads in the financial-services industry, particularly in Wall Street trading applications. The Chicago Mercantile Exchange, for example, is replacing the infrastructure that runs its iLink gateway, which traders use to access the exchange's Globex electronic trading platform. The infrastructure, built on Sun Microsystems servers running Sun's Solaris version of Unix, is being migrated to Intel servers running the Itanium processors and Red Hat Linux. The exchange is experiencing five times the performance of Sun/Unix at one-fifth the price, says Charlie Troxel, the exchange's chief technology officer. It originally planned to replace 20% of the Sun servers by the end of the year, according to Troxel. Now it's on track to replace 50%.

The exchange will continue to run its historical database on Sun servers, however. That database is used to recreate trades in the event of inquiries from customers or regulators. That system, which uses database technology from Oracle, has reliability and scalability requirements that aren't easily addressed by Linux, Troxel says. He adds that the number of database entries has spiked from 2 million per week two years ago to 500 million last week.

About the Author(s)

Never Miss a Beat: Get a snapshot of the issues affecting the IT industry straight to your inbox.

You May Also Like

More Insights