If you aren't a techie, you may not be aware that 2012 was a major turning point for trading application development. The leading providers of front-end trading applications in FX, fixed income and OTC derivatives have moved quickly to adopt HTML5, the latest version of the HTML standard. While it may be tempting to dismiss this change as the latest technology fad, it presents some exciting new possibilities for the financial industry and, unlike the technologies it's replacing, HTML5 is here to stay.
What is HTML5?
HTML5 is the first major upgrade to the lingua franca of the web in over a decade. There are many technical details, but essentially HTML5 is all about user experience – the sort of user experience that we now all expect from our iPad apps and (it turns out) the sort of user experience that professional traders expect from their desktop trading applications.
Until about this time last year, many financial firms were opting for either Adobe Flash or Microsoft Silverlight to build front-end trading applications. These web technologies provide a rich and interactive experience that is particularly needed for real-time trading and which HTML4 struggled to achieve. With HTML5 now able to provide the same richness of experience, Flash and Silverlight are on their way out.
The demise of Flash and Silverlight
In April 2010, Steve Jobs famously announced the demise of Flash and the ascent of HTML5 in his public letter titled “Thoughts on Flash”. But it wasn’t until about this time last year when the debate took a decisive turn with Adobe announcing it would discontinue support of Flash for mobile and a Silverlight product manager stating emphatically that “Silverlight is dead.”
At the same time, both Adobe and Microsoft were more vocally registering their support for HTML5. Adobe acquired an HTML5 app platform called PhoneGap and Microsoft put its weight behind HTML5 with both Internet Explorer 9 and Windows 8. With these announcements, many financial firms who had invested in Flash and Silverlight took note and began looking to HTML5 as the clear alternative.
Bridging the browser gap
While financial industry technologists are embracing HTML5, they face two fundamental challenges:
1. A majority of financial industry desktops don’t run a modern web browser
2. Trading and other real-time applications require an “outside-the-browser” user experience
If you work at a large financial institution, chances are that your desktop is running Internet Explorer 6, 7 or 8. The most advanced version, IE8, supports very little of the HTML5 standard which essentially means that an HTML5 application will struggle to run in your browser.
The more critical obstacle is that trading applications often require the native experience you get when you are running an application outside a web browser. Request-for-quote (RFQ) systems, for example, depend on a window popping up to alert the trader that a customer wishes to trade. Market alerts often require a popup notification to be generated (like the one you get from Microsoft Outlook when you have a new email). Order entry is often faster for traders if they can invoke the trading application directly from the keyboard. These are all user experiences that are either difficult or impossible to do even with the latest web browsers such as Google Chrome and Apple’s Safari.
Many firms in the financial industry are working to bridge this gap using Chromium, Google’s open-source browser technology. With Chromium, developers can build a “wrapper” or “container” that allows an HTML5 application to run outside the browser. Others are experimenting with Google Chrome Frame which allows Internet Explorer to become HTML5-compliant. How long the browser gap will persist in the financial industry is hard to predict, but these challenges aren’t slowing the pace of HTML5 adoption.