Appendix E: E-Commerce Case Studies

The following are several case studies that highlight e-commerce solutions and strategies for the new net economy.

Note

The author and publisher do not endorse any companies or their products in the following case studies.

Case Study 1: Share Dealing

Share dealing is turning out to be one of the most popular applications for e-commerce. The attractions are many and obvious: shares can be sold quickly, relatively cheaply, in real time, and with the minimum of fuss and human intervention.

One of the most successful and popular of the new online, share-dealing companies is Stocktrade. Based in the heart of Edinburgh’s New Town and the first entrant into the UK marketplace, the company is owned by the Brewin Dolphin Group and employs more than 300 people.

Stocktrade’s new execution-only, Internet-based share service, launched on the Internet in 2002, breaks the mold of more than 200 years of stockbroking. The company has been involved in telephone trading for the last eight years, but creating a complementary trading service on the Web was a high-risk venture, with no one really knowing if it would work.

Preparing for the New Net Economy

After less than two years in operation, it is clear that the gamble has paid off, as the Internet service is highly popular. The main reason for success has been Stocktrade’s desire to offer a superior product in the marketplace—a desire underpinned by the company’s choice of Sun Microsystems’ hardware and its decision to use Java applets to generate the interface for customers.

The company’s trading model is slightly unusual, but highly effective. It uses the London-based company, Interactive Investor. Interactive Investor acts as Stocktrade’s Application Service Provider (ASP). The transactional software, ROX, is hosted by Interactive Investor on a series of Sun Enterprise™ 4500 servers. ROX is a configurable, business-rules-driven order management and order routing product suite enabling high volume, straight-through securities transactions processing and information distribution over TCP/IP networks in real time.

The success of the business means that Interactive Investor has had to add more processors and memory to the Sun system on a regular basis in order to maintain performance and keep pace with demand. The Sun Enterprise 4500 servers are built in multiprocessor configurations, run under the Sun’s Solaris™ Operating Environment, and use Sun StorEdge™ A1000 disk arrays. Development is done in Java and C++.

Meeting Demand

Over the last few months, business has been booming as more and more investors have signed up to the convenience and cost-effectiveness of the Stocktrade share dealing approach. With the concept of online trading now well- and truly established in the UK (thanks to Stocktrade’s innovation), the company is expecting business to keep on expanding at a dramatic rate. It currently has 25,000 registered customers and expects this figure to double or perhaps even triple by the end of 2003. That growth will clearly pose its own technical and systems challenges.