Affordable E/CTRM

London, 10 August 2012

Recent CommodityPoint research, including the 2011 CTRM Market Size Report, indicate that license fees for the large-scale, traditionally installed systems are now generally above $1,000,000 for those companies that operate in the top and upper middle tiers of the market—those companies employing more than 50 trading staff, trading more than a single commodity, or operating in multiple geographies.

For the rest of the mid-tier, initial license fees in excess of $750,000 are not uncommon and for the lower tiers of the market, very few of the larger vendor solutions can be had for an initial license fee of less than $250,000. When combined with the cost of annual support and maintenance of 20% of the initial license fee and implementation costs that run, on average, two times the initial license fee, it's little wonder that many in the mid-tier and lower tier of the trading markets feel they can not pursue licensing of a fully supported, vendor supplied solution.

This perceived lack of affordable solutions has effectively locked many smaller companies out of the market for a vendor supplied and supported solution. In the current market environment, marked by constant and unrelenting changes including the impending Dodd-Frank regulations, few companies can afford to not seek out a supported solution (or upgrade an outdated version) to capture, manage, report, and monitor their trading activities. Not having such a system can create significant risk of non-compliance with new regulations (either through the reporting of inaccurate data or an inability to identify and report such data in a timely fashion) and expose the business to significant punitive fines.

Fortunately, for those companies that haven't been able to afford the traditional large scale E/CTRM solutions, the last several years have witnessed a new generation of E/CTRM software providers offering cost effective solutions built around architectures that are more open and, potentially more importantly, more affordable.

In their latest CommodityPoint white paper, Affordable E/CTRM, CommodityPoint examine these new lower cost offerings and discuss the advantages such solutions can provide for those companies that had previously not been able to afford a full-featured E/CTRM system.

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