H timmo ns a lo ndo n hedge fund that opts f o r

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Unformatted text preview: f f erent transmissio n media to get to their f inal destinatio n. If yo u use a lapto p co nnected via Wi-Fi, then that wireless co nnectio n f inds a base statio n, usually within abo ut three hundred f eet. That base statio n is pro bably co nnected to a lo cal area netwo rk (LAN) via a co pper cable. And yo ur f irm o r co llege may co nnect to f ast, lo ng-haul po rtio ns o f the Internet via f iber-o ptic cables pro vided by that f irm’s Internet service pro vider (ISP ). Mo st big o rganizatio ns have multiple ISP s f o r redundancy, pro viding multiple paths in and o ut o f a netwo rk. This is so that if a netwo rk co nnectio n pro vided by o ne f irm go es do wn, say an errant backho e cuts a cable, o ther co nnectio ns can ro ute aro und the pro blem (see Figure 12.1). In the United States (and in mo st deregulated teleco mmunicatio ns markets), Internet service pro viders co me in all sizes, f ro m smaller regio nal players to sprawling internatio nal f irms. When dif f erent ISP s co nnect their netwo rking equipment to gether to share traf f ic, it’s called peering. P eering usually takes place at neutral sites called Internet exchange po ints (IXP s), altho ugh so me f irms also have private peering po ints. Carriers usually do n’t charge o ne ano ther f o r peering. Instead, “the mo ney is made” in the ISP business by charging the end-po ints in a netwo rk—the custo mer o rganizatio ns and end users that an ISP co nnects to the Internet. Co mpetitio n amo ng carriers helps keep prices do wn, quality high, and inno vatio n mo ving f o rward. Finance Has a Need for Speed When many f o lks think o f Wall Street trading, they think o f the o pen o utcry pit at the New Yo rk Sto ck Exchange (NYSE). But human traders are just to o slo w f o r many o f the mo st active trading f irms. Over half o f all U.S. sto ck trades and a quarter o f wo rldwide currency trades no w happen via pro grams that make trading decisio ns witho ut any human interventio n.H. Timmo ns, “A Lo ndo n Hedge Fund that Opts f o r Engineers, No t M.B....
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