Going The Extra Mile

Christian JamesProduct Manager

Push Technology Ltd

Mike StolzVP of Architecture

GemStone Systems Inc.

Agenda

• Demands within the betting industry• What is latency• The cost of latency• Combating latency• GemFire/Diffusion solution• Q&A

Demanding and competitive environment

Technology drives competitive advantage

Demanding business requirements and drivers

• Speed, Stability, Scalability• Increase the number of markets offered• The ability to offer more volatile markets• Deliver to more channels• Improved marketing/advertising capabilities• Minimize unmatched orders/bets• Global distribution and real-time replication• Localized Data creating better user experience• Cost effective

Latency is everywhere

What is latency?

Total latency equals

Disk access+

Sender overhead +

Time of flight +

Message size/Bandwidth ** +

Receiver overhead

** Potentially misleading

E-Betting flow…

Accept & Place Bet

Odds Repository

Can User Afford Bet?

Valid Bet?

Bet rejected

Book Position/

Risk Monitor

100s of W

eb

Servers

No

Yes

No

Yes

DatabaseDatabase

…has many sources of latency

Accept & Place Bet

Odds Repository

Can User Afford Bet?

Valid Bet?

Bet rejected

Book Position/

Risk Monitor

100s of W

eb

Servers

No

Yes

No

Yes

DatabaseDatabase

Why worry about it

It Costs!

The cost of ignoring it is high, and its not just trading systems

• Amazon – every 100ms of latency cost them 1% in sales

• Google – an extra 0.5 seconds in search page generation time dropped traffic by 20%

• Financial – “If a broker’s electronic trading platform is 5 ms behind the competition it could loose them at least 1% of their flow – that’s $4 million in revenues per ms” (TABB Group)

Latency reduces revenue, causes losses and results in a poor end-user experience

Accept & Place Bet

Odds Repository

Can User Afford Bet?

Valid Bet?

Bet Rejected (Lost Revenue £££)

Book Position/

Risk Monitor

100s of W

eb

Servers

No

Yes

No

Yes

Difference in odds X amt.

DatabaseDatabase

Lost £££

Money is lost as bets are rejected ortaken at poor prices

Bet placed for £10 @ 10 to 1

Odds generated, odds offered 10 to 1

Bet booked, odds now being offered 5 to 1

End client wins

Payout is £100versus £50

In-running greatly amplifies this effect

Operating costs are high as architectureis inefficient

Accept & Place Bet

Odds Repository

Can User Afford Bet?

Valid Bet?

Book Position/

Risk Monitor

100s of W

eb

Servers

DatabaseDatabase

No

Yes

No

Yes

Difference in odds X amt.

Bet Rejected (Lost Revenue £££)Lost £££

Budgets are being wasted on OPEX rather than advancing the business via CAPEX

• 60-70% of IT budgets spent on operational costs (CIO Magazine)

• 5% of IT budgets spend on energy (BBC)• 1996-2006 no. of servers in London increased

from 6 28m. • Avg. power consumption of each increased from

150 400 watts.• In 2007 it was predicted London would run out of

power in 2009

“Latency Exists, Cope!” (Dan Pritchett)

Combating it:

Hardware or software?

Moore’s law hasn’t held up for hardware speed gains,

they are slowing

CPU Clock Speed, Moore’s law still exists (for how

long)but for different reasons –

plus Memory/RAM Wall broken

Ram Speed (limited to distance from CPU)

Desk I/O PS

Network

Speed of light

Sp

eed

Date

Bandwidth should also be a cause for concern…

• “Net bombs” are gobbling up the internet– YouTube = using the same amount of traffic as the

entire internet in 2000– iPlayer 5% of UK internet usage.

• Monthly internet traffic is running at 8 exabytes (million trillion) – one exabyte is equivalent of 50,000 years of DVDs

• 2007 traffic grew by 75%, capacity by 45%• Brownouts/jitters are due to start in 2010• What is the alternative?

How we tackle it

Faster software running on fewer machines

"Hardware can give you a generic 20 percent improvement in performance, but there is only so far you can go with hardware. “ Rob Wallos, global head of market data Citi

GemFire & Diffusion kill inefficiencies reducing costs and increasing revenue

GemFire looks after the first miles… …and Diffusion the last

Accept & Place Bet

Odds Repository

Can User Afford Bet?

Valid Bet?

Book Position/

Risk Monitor

DatabaseDatabase

GemFire

No

Yes

No

Yes

Difference in odds X amt.

Bet Rejected (Lost Revenue £££)Lost £££

Diffu

sion

In essence, a suite of low latency communication products

• GemFire allows you to create a highly resilient, elastic, enterprise data fabric to improve performance while simplifying your architecture.

• GemFire enables you to safe-store and receive data and events to and from any back-end data source and pass notifications off to Diffusion.

GemFire – Enterprise Data Fabric

In essence, a suite of low latency communication products

• Diffusion allows you to create a two-way secure real-time online channel between an organisation and its audience.

• Diffusion enables you to push and receive data and events to and from any current, or future, “net” connected device including the web browser.

Diffusion – the power behind the Net

Smaller messages optimally delivered, reducing latency and foot print

• Best Message Delivery (BDM)– Conflation– High/Low Water Marks– Throttling (could be used to level the ‘playing field’)

• Compression• Your own message format avoids unnecessary

transformation/serialization • Only send deltas - reduces size/amount of data sent• Hierarchical topics - reduces size/amount sent to finest grain• Connecting various devices – browser/mobile/interactive TV

etc.• These techniques can reduce bandwidth consumption

by up-to 80% and help achieve a better end-user experience

Hierarchical topics, in context of abetting exchange

Strong focus on performance & efficiency, driven from the server

• NIO technology ensures data moves through Diffusion & GemFire as quickly as possible

• Zero Copy• Zero Fan-out• Bi-directional, no need to open another socket

when sending information (executing a bet) back to the server as you would with a web request

• Scaling the application (massive number of clients on a single server)

• These approaches can massively reduce your hardware requirements

Global Edge Caching ensures most efficient client connectivity without replicating the whole application environment

Questions & Answers