For over 40 years the financial services industry has relayed time sensitive information using the “Hoot ‘n’ Holler” system.
ETC solves the problem of an outdated analog-based “Hoot ‘n’ Holler” system.
This inter-office intercom consists of analog phone lines, microphones and speaker boxes called “squawk boxes”. It allows regular communication with satellite offices and disperses information such as the morning market report to traders and brokers. A “Hoot ‘n’ Holler” network is also used to talk to clients and shout orders to the trading floor. Today, a typical brokerage firm has several of these networks for each business group, Equities, Retail, and Bonds.
While effective, this form of technology is being replaced with Internet-based communications that offer cheaper, more efficient and more reliable options for companies to consider.
THE CHALLENGE
Our firm, Essential Trading System (ETC) was contracted by a leading Mid-Western bank to help solve the problem of an outdated analog Hoot System. The Bank’s Institutional Trading department specializes in three areas – Municipal, Taxable, and Corporate Bonds. Traders in each business group needed to communicate with peers across six Midwestern offices and one New York office. They could no longer rely on their older, outdated analog Hoot system. While fully functional, the equipment was no longer being manufactured or supported. The bank asked us to create a cost effective solution to replace their system in lieu of other expensive solutions such as a trading turret with a price tag of upwards of $15,000 per seat.
“We selected ETC as our partner because our analog system was at the end of its useful life and was not always reliable. Replacement parts were not always available which created maintenance issues for us.
We are happy not to have the ongoing monthly analog phone costs associated with our old system. Being able to use our existing data network and ridding ourselves of ongoing expenses means we can achieve a high return on investment while obtaining a modern, reliable network.”
THE SOLUTION
Essential Trading Solutions (ETC) recommended a state of the art Voice over Internet (VoIP) solution called a Simple “Hoot ‘n’ Holler”. VoIP phone systems work over the Internet by sending and receiving voice signals that are packaged as data. A VoIP system can be installed in virtually any WAN or LAN environment using a company’s existing data lines. ETC recommended that their customer install CS-64 mini-Trading-Consoles, which feature Push to Talk (PTT) monitoring on four simultaneous Multicast VoIP channels. These consoles allow users to communicate with four pre-programmed user groups at the touch of a button. Thirty-three individual units were distributed to six branch offices throughout the Midwest and New York NY. Three of the four channels on the console were configured for their markets, Muni (Municipal Bonds) Tax (Taxable Bonds) and Corp (Corporate Bonds). The fourth channel was used as a Companywide ALL Call channel. This was accomplished at a fraction of the cost of other options with low maintenance costs going forward. The Bank’s new VoIP system offered all of the features of the old analog system along with a number of cost savings and operating benefits.
Our Analog system was at the end of its useful life and parts were no longer available with reliability and maintenance an issue. The on-going Analog Circuit costs were also a major factor for the change. So we chose the ETC system because it would give us a great ROI by utilizing our existing Data Network and at the same time give us the reliability of equipment that we needed.
THE BENEFITS
The Bank’s new VoIP system offered all of the features of the old analog system along with a number of cost savings and operating benefits.
Cost Savings
- Our customer no longer faced monthly fees for dedicated phone lines – The Bank had been paying the phone company for separate leased-lines to transport their “Hoot ‘n’ Holler” to remote branch offices. This recurring, yearly charge exceeded $37,000. VoIP is typically 40-80% less expensive than traditional landline phone service and it only takes a company six to eight months to recoup its initial investment (ROI).
- No Installation Costs – The installation of the CS-64 consoles is so simple that the Bank’s own IT department was able to install it and set up at their own pace.They avoided the costs typically associated with analog systems such as configuration, installation, upgrades and maintenance.
- Lower IT Support Costs – Going forward, the Bank’s IT Department can support and reconfigure the systems remotely which reduces the time to troubleshoot a problem and improves overall network manageability.
Flexibility
Analog systems do not offer much flexibility while VoIP systems can be easily reconfigured to new employees, support new product lines and easily add new business units. Additionally, VOIP can easily accommodate employees working remotely.
Greater Reliability
Using a VoIP system eliminates down time related to phone company network problems and the new VoIP systems requires significantly less maintenance than the older analog systems.
Improved, Faster Communication
Unlike sophisticated computer systems, the ETC CS-64 mini-Trading-Console has the advantage of Push to Talk, person to person communication. This feature allows voice interaction which facilitates negotiation and immediate feedback.
THE FUTURE
Currently the trend in the financial service industry is a moving away from traditional hardware based analog systems and a moving toward VoIP based solutions. Digital communications is rapidly becoming the new standard. It’s not hard to understand why. The VoIP phone systems are easy to install, highly functional and extremely cost effective. Essential Trading Solutions is available to discuss how a VoIP system could benefit your business.
Essential Trading Solutions
9 Austin Drive, Marlborough CT 06447
www.essentialtel.com
(860) 295-8100
sales@essentialtel.com
