Taho Releases Orbit to Rearchitect Online Brokerages

Although the concept of online brokerage is only a few years old, some early adopters are already fed up with their existing technology and are ready to enter the next phase-albeit an unpleasant one. A small price to pay for being early to market, it's time for some online brokerages to replace their initial infrastructure in search of a more reliable system that uses newer technology.

Taho Commerce Group is an infrastructure vendor that is positioning itself as just that, a second generation architecture company preparing for a wave of online brokerages that are ready for a face lift. Taho explains that the firm is ready to go live with its first client, a clearing firm/brokerage that is planning a reincarnation with Taho's product-Orbit. Taho's managing partner and cofounder Blake Henry, says the firm is in talks with three other e-brokerages that are ranked in the top twenty, and are looking to replace their infrastructure as well. Blake would not disclose Taho's client or potential clients.

Taho, which was founded in February of 1999, offers Orbit on an application service provider basis. The first release, Orbit 1.0 enables firms-for example, a clearing firm-to offer online brokerage or trading to its correspondent clearing clients through private branding. He notes that Taho separates the back end of the product from the front end, so the screen can be truly branded to look exactly like the brokerage firm's site.

Orbit's strength, Henry says, is in its experienced staff. Many of its employees developed systems for the first round of online trading firms, such as E*Trade-and have learned from the experience. What many of the early adopters are lacking is reliability-as evidenced by some of the outages-and the ability to truly privately brand clients sites. Henry explains that Taho has many technology partners which helped it with the launch of Orbit, for example, Sun Microsystems, IBM and Silver Management. IBM and Silver helped Taho form a business continuity plan-applying the plan to all areas including software and data centers. The system runs on Sun processors and uses its high availability Sun Cluster principals which ensures that users will be able to access their portfolios and trade at all times, Henry says. Orbit's main competitors are AFS, digiTRADE and The Vantra Group. Orbit version 1.1, which, he claims, will be bug-free and offer richer performance reporting presentation, will be released in November.

Jodi Cornish, analyst at Celent Communications, has a few things to say about the relatively new product. She notes that although she had not been able to test Orbit yet, it is somewhat weak in a few areas. For one, Taho has not set up many content relationships. However the company does say it can plug in to the client's market data vendor of choice. In addition, it is weak in the analytics area. Furthermore, she adds that it only handles equities, mutual funds and options, not fixed income or futures.

On the flip side, Orbit does have a portfolio accounting module built into the system that allows it to handle tax lot accounting, "which is a plus." As for the architecture, she says it looks like a typical three-tiered set up. After all this, Cornish notes, this is not to say that it won't be able to do all the things that the company says it will, this was just an initial take.