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Laure Edwards
Laure Edwards
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Setting a New Standard for Online Brokerages

E*TRADE has put together a new stateless technology to handle the increased traffic it hopes will result from its new destination Web site.

Discount broker E*TRADE is aiming to capture retail investor attention, and become a trading Web site to linger over. Flashy television commercials and snappy slogans aside, The New E*TRADE certainly has raised the bar for other retail brokers with its new site announced Sept. 10, by continuing the march to offering ever more research and services, free in most cases.

Gomez Advisors awarded the number one spot to E*TRADE in its 1998 second quarter rankings of trading Web sites, partly due to the services E*TRADE had started offering months before the official announcement. "We don't normally include 'test' services in our evaluations," says Alex Stein, a principal at Gomez, "but E*TRADE had supported these new services so consistently that they were not deemed as tests, so we included them."

As part of its strategy on the new site, clients are categorized in four ways: visitors, members, customers and subscribers. Visitors are those just browsing through the site. Membership is granted to someone simply filling in the form on site, and among other services members get real-time quotes, custom views of the markets and live market commentary from Briefing.com. Customers arrange to do their trades with E*TRADE, and they also receive services such as smart alerts, interactive charts, dynamic streaming quotes and options analysis. Subscribers pay for the premium services, including access to IPOs and real-time, institutional-level research. Whereas E*TRADE revenues had come mainly from transactions and asset management, the firm is now also pursuing subscription and commerce revenues from users, advertising income, and revenue streams from expanded international coverage.

An important background enhancement to the new site is E*TRADE's new stateless architecture, designed to handle spikes in transactions. The overall principle behind this multi-tier architecture is segmenting the layers of system access, transaction processing and database access.

The first layer for accessing the system is session management, a key function that directs the relationship between the Web and the e-commerce engine. The Web is stateless, as in a kind of free-flow space allowing someone to go here and there to visit sites or do transactions. The e-commerce engine, however, maintains a state into which you enter to do a specific transaction and get a validation. E*TRADE chose to handle its customer requests in a more stateless environment.

Debra Chrapaty, president and COO of E*TRADE Technologies and EVP and CIO of E*Trade Group, chose Netscape Application Server, originally called KIVA, as the session layer manager. This is how it works. After a customer passes through E*TRADE's firewall and SSL encryption, the session layer manager directs the session state. A session hosting component identifies the user and manages the session, keeping track of the session all during activities on the transaction and database access layers.

This new session layer manager treats the session as a transaction flow instead of one single process, as older systems do. The result is that a user can execute multiple transactions on multiple servers, all pegged to their session and state by the manager. This means no more dependency on any particular server, an important factor in times of high demand.

Previous systems used CGI (common gateway interface) and C++ code to identify and link a user between the Web and e-commerce engine. In the CGI environment, an action is identified as a process pegged to the user's IP address, name and identification. A trade, then, is a process that sits on one server, which does a single process at a single time, albeit pretty quickly. This system works okay for a fairly consistent number of customers. But the wildly fluctuating numbers of investors reacting to recent market swings tax CGI and C++.

Instead, E*TRADE's session manager allocates sessions across many servers. This solves the problem of "10,000 users all of a sudden pounding, trying to activate a session," says Chrapaty. Also, storing across multiple servers addresses the worst-case scenarios of servers crashing or a motherboard burning out. The session manager "automatically transfers across the cluster of servers, so you don't lose your session," she says. Dynamic load balancing is another important element. "So on a day like today with yet another 300-point swing in the market, I can take a hot box and pop it in dynamically across the cluster of boxes without losing the session." This offers scale and flexibility at the session layer.

The next layer is for transaction processing. After the session manager passes the user to the transaction layer, he or she may pass through a series of server farms while getting a quote, placing a trade, or obtaining some content. Tuxedo, a long-established transaction processing tool from BEA, "grabs the transaction, tags it, time stamps it and creates the log so it can trace and monitor the transaction throughout the system," says Chrapaty. Reusable code objects built in Java actually accomplish the transactions; Tuxedo passes the transactions to wherever they need to go.

Inquiries pass to the third layer, the Oracle database layer, where someone would be able to get a quote from, for example, Quote.com. All of this takes place on a pool of Sun servers, multiple Netscape application servers, many fail-over Tuxedo servers, and many redundant Oracle database servers, in Palo Alto and Sacramento, Calif., and a new facility in Atlanta.

The first iteration of the stateless architecture product was introduced along with E*TRADE's mutual funds site in November '97, further testing was done in Australia in January. The complete system ran the new site in the U.S. in September. But not surprisingly, there were some hiccups along the way.

"The biggest challenge was taking three new products and getting them to work together seamlessly," says Chrapaty. She had some issues with the Netscape and Sun products working together. The Sun Solaris operating system was upgraded to version 2.116 from version 2.15, to accommodate the necessary Netscape functionalities.

Another challenge was realizing real-time replication among the databases. When someone places a trade, they might be processed within servers in, say, the Palo Alto facility. But if that person logs out and then back in quickly afterwards, the next available ISP might take them to the Sacramento facility. If all the databases are not updated, then that person's account is out of sync. Chrapaty is using the Netscape and Sun products to "push the database queuing and real-time replication," she says.

When Chrapaty came to E*TRADE a year and a half ago from the NBA, where she was VP of information technology and CTO, "I realized that this company is not your usual bear," she says. With as many as 1,000 new customers in a day at E*TRADE, "you need to be more like McDonalds than Microsoft; be hot, fresh and juicy every day." But now that E*TRADE has cooked up its new stateless architecture, when the markets start to get hot and investors begin mobbing the counter, she says, "we start to realize the benefits of scalability and reliability of this technology."

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