To say that E-Trade Financial has embraced open source is putting it mildly. The financial services firms open-source journey began in 2001, when it replaced several of its Sun Microsystems Solaris-based servers with IBM x86 Linux-based systems.
E-Trade saved millions of dollars annually in the process, and has extended its open-source interests to middleware and even the use of the community development process as a model for its own internal development.
To learn how E-Trade effectively leveraged open source and how other organizations can apply its lessons learned for eWEEKs January Road Map, eWEEK Labs Senior Analyst Jason Brooks spoke at length with E-Trades Vice President of Architecture Lee Thompson.
What started E-Trade on this journey?
[Prior to Sept. 11, 2001,] trading volumes were above 300,000 average trades a day, and that dropped to something in the range of 55,000 a day. Our cash flow was affected, obviously, quite dramatically.
You could go into an E-Trade data center, and you could imagine yourself looking down the aisles of shelves. Instead of food, you would see Sun Enterprise 4500s—three full rows of them. And it was costing quite a lot of money to keep those things running.
Around 2001, I had my architecture department allocated for a project that was canceled. We kept on playing with Linux.
I knew that Amazon had already moved over to Linux, and Yahoo was on a FreeBSD stack since its inception. And so I knew that, at some point, architecturally, an open-source operating system would be of some interest.
Around that time, in 2001, the Red Hat 7.2 kernel came out, which had support for SMP and a 32-bit message queue for shared memory. And, all of a sudden, our application booted.
I went to the CIO and said, I have some people not allocated to a project right now; Id like a chance to look at this further and do a feasibility study.
And so we grabbed a bunch of our architects and we ran like crazy and got a full stack of our application. …We grabbed Apache, and we grabbed the Jakarta Tomcat servlet system, and we ported a representative stack of our application—our authentication, quote services, product services, some of our trading services and the servlets that rendered the HTML—over to this new stack.
So, you can imagine on the left-hand side of your piece of paper, iPlanet Web server, iPlanet app server, Tuxedo on Solaris and Sybase on Solaris. And over on the right side of the picture, for this feasibility study, we did Apache, Tomcat, Tuxedo and Sybase on Solaris, and we demonstrated that to the CIO and the rest of the technology management on Halloween 2001, a quite memorable meeting.
We ran some load testing on it, and we knew when it fell over, and the way the Sun systems worked, we could keep adding more and more test users on the Sun box and it would just keep, cranking along—it didnt really elbow. The Linux box was much faster, and then around, it was somewhere around 180 users, it would elbow. … But before 180 users it was much faster.
I demonstrated this on Halloween 2001, and it was pretty simple. These grocery store rows of Sun 4500s were costing about a quarter of a million dollars apiece, and we could run 300 to 400 users on them. And heres this little box that cost us about $4,000. It was running faster, but you could only run 180 people on it.
Josh Levine, the CIO at the time, said, Well, then we just need to get two, for $8000. Do it—put a box in production. So it was a fairly short meeting.
What was the hardware at that time?
It was IBM x330s, and then we started buying x335s. At the time, I remember reading something like [IBM proposing] putting a billion dollars of investment into open source and Linux, and moving a lot of the IBM software over. And they were kind of going around and asking companies if they wanted to look into an open-source stack, and we had this research going at the same time, and we were like, "Yeah, wed love to look at that with you." So we had IBM helping us with that prototype. And of course we used IBM hardware.