The first IT wave to hit Wall Street was real-time market data. Wave two was automated trading. The next wave approaching the financial markets shore is rich media content.

Wall Street has always been where the action is when it comes to technology. Over the last 20 years, there have been “bangin” waves of technology on Wall Street and the IT professionals have been the “surfer dudes” riding those waves1. But the currents are changing in IT. Is it possible that Wall Street will miss the next wave or worse yet…wipe out?

The first IT wave on Wall Street was real-time market data…and it was gnarly! This wave created Reuters, hundreds of start ups, and the current mayor of New York. The concept was transformational. Collect pricing and transaction data from financial exchanges around the world. Consolidate and present that information on a series of computer screens. Add in powerful analytical tools. Correct any data inconsistencies. And do it all in real time. Market data spawned huge IT departments, billions of dollars of spending on technology, and tremendous wealth creation opportunities for market participants.

The second wave was all about automated trading and it was like “riding the tube”. It started with algorithmic trading that turned quant jocks into the Big Kahunas. Computer models were built that executed trade orders based on market conditions and the underlying investment strategy. Thousands of hedge funds emerged. Order management systems became mission critical. Most recently, the rage on Wall Street has been eliminating network latency from trading systems. IT departments are loading trading applications on servers and placing those servers as close as possible to the servers of the trading venue. Then they press the “on” button and hang ten.

A new wave is coming to Wall Street that could end up pounding the IT professional – rich media content. For the first time in decades, college students and teenagers may have a better understanding than the IT veteran of the business opportunities that can be created by new media technology. Social networking. Web 2.0. Podcasts. Wikis. Blogs. Streaming media. Content monetization. Think of this new media content as community applications. And at their core, communities are what Wall Street loves -- markets.

What to do next? Rich media is just an enhancement to the application and IP networks that Wall Street has perfected over the years. Wall Street has real-time global IP networks for collecting and distributing market data. Wall Street has high-performance servers and storage interconnected with low-latency networks for executing trades. The next step is to add a media layer to this infrastructure model that supports streaming, caching, and live delivery of content. Then a new breed of applications can be rolled out that taps into the collective power of the community marketplace. Even better, Wall Street has a track record of being able to monetize content (aka market data) so there should be no problem monetizing new media content.

The next IT wave approaching Wall Street is called rich media content and it's fat! Are you going to ride the wave or turtle?

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For a glossary of surfing terms, visit Rippin H2O at http://rippinh2o.com/dropzone/surflingo.shtml

Jim Leach is a Vice President at Internap (www.internap.com). He can be reached at 404-302-9755 or jleach@internap.com.