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London, June 20, 2006 – As securities and investment institutions confront increasing pressures to be more profitable, competitive, latency is the new battlefield. New research from TowerGroup finds that data stream processing vendors are emerging as the next “arms dealers” in the race to provide a competitive edge to players across the electronic quantitative trading market.

With the increased volume of data across asset classes and data sources, the need to aggregate data with minimal latency is critical for all institutions looking to offer competitive products and manage risk. In addition to meeting pending regulations, firms must have in place technology that will provide customers with the best price available in the market. TowerGroup expects tremendous growth in data stream processing, as new technologies displace proprietary in-house systems, expand existing footprints in client institutions, and become integrated components in other third-party software and services.

Even in its infancy, third-party data stream processing solutions are having a profound impact on the financial markets, and have penetrated a number of institutions known for their propensity to build rather than buy technology.

Technology providers are recognizing the demand for data processing applications, and are creating fresh and/or building on previous technology to help integrate real-time data, historical data, and overlay analytics to generate both derived data and actionable output. Over the next 24 months, TowerGroup expects a shift in this market toward deployment and integration of data processing tools into traditional asset management and retail-focused brokerage firms.

TowerGroup has issued two new reports titled, “Data Stream Processing: The Quest for Zero Latency Data Processing” and “Data Rolling on a River: Fishing the Vendor Waters for Data Stream Processing Solutions,” by William Butterfield, Research Associate for the Securities & Investment Group at TowerGroup, with Gavin Little-Gill, Research Director for the Investment Management and Brokerage & Wealth Management groups at TowerGroup. These reports explore the evolution of data stream processing solutions, the factors driving the adoption of these systems, and ways these systems are currently being leveraged by securities and investment firms. The research also examines the factors institutions should consider when evaluating adoption and implementation.