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National Discount Brokers Ranked No.1 in Barron's Survey of Online Brokers
National Discount Brokers

Financial Services 

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"Thanks to iPlanet, we don't have to look under the hood any more. We can just focus on what we do best -- satisfying customers and growing our business" 

— Gregg Sharenow, Executive Vice President, National Discount Brokers

National Discount Brokers surges ahead with iPlanet E-Commerce Solutions

National Discount Brokers (NDB) is succeeding in the fast-paced and high-profile world of online trading by focusing on their top priority-creating and maintaining a reliable and scalable web site for their account holders. As of February 7, 2000, NDB had 200,000 customer accounts, with assets of $10 billion. By January 2000, NDB was handling up to 25,000 trades per day and had realized a 67 percent increase in revenues. What's behind NDB's rocketing success? A lot more than the latest record-breaking rise in NASDAQ numbers.

The top priority: a reliable and scalable website
For any company building a business on the Web, customer confidence and loyalty are paramount. An e-commerce website today must be accessible on a 24x7 basis, with all information and functionality accurate and consistently available. It must also have the reliability to serve the needs of existing users and the scalability to expand all website services to accommodate aggressive growth in both new users and traffic volume.

Though running a website that does not crash may seem like an obvious requirement for success, NDB, along with other online brokerage firms, faces many additional challenges. NDB must meet not only the demands of end users trading through their site, but also the regulatory requirements of the Securities and Exchange Commission (SEC) and the National Association of Securities Dealers (NASD). These watchdog agencies closely monitor such factors as "Best Execution" and system reliability. "One aspect of Best Execution involves how fast a customer gets an execution after entering a trade," explains Gregg Sharenow, executive vice president for NDB. "If our system goes down for any length of time, the SEC and NASD take a very disdainful view. And, of course, our customers go ballistic!"

For NDB, availability is a critical requirement. Online traders demand not only Best Execution but also the ability to monitor portfolio performance on a minute-by-minute and round-the-clock basis. Today, with the worldwide reach of the Internet, traders are already doing business well after the closing bell rings on Wall Street.

In addition to the challenge of meeting the needs of current customers' trading activities, NDB also needed a strategy to make sure that all services could withstand an increase of new customers. Though NDB's system is currently sized to handle 5,000 simultaneous log-ins without degradation, NDB plans to double and even triple that capacity soon. Also, it may not be long before broadband technologies and regulatory changes extend the trading day to 24 hours, which could increase online trading exponentially. NDB needed a system in place to meet these new capacity requirements.

To build a system that could effectively scale and meet reliability standards in a cost-effective manner, the company needed to add new application servers without necessarily adding real estate and personnel. This was the key problem NDB had faced with "Web 1," the site they had developed internally. "NDB had hundreds of little sub-components within the site and a lot of very complex back-end connections written in C and C++," says Ernest Park, senior systems engineer for iPlanet. "To realize economies of scale, they needed things like load balancing and scalability so they could add capacity without having to change the code-a very labor-intensive task and, therefore, expensive."

The core solution: iPlanet Application Server architecture
The first step NDB took toward improving their website was to research the server vendor market. They quickly found out about the excellent reputation iPlanet E-Commerce Solutions has with similar businesses. "We chose iPlanet," Sharenow notes, "because we wanted to partner with a company that had a track record we could rely on for scalable, reliable, and fast-performing systems. iPlanet E-Commerce Solutions provides all those things. After all, Netscape was first to the Web, and Sun has tremendous hardware penetration into this market. When you put those things together, it's very compelling. Our homegrown website did not allow us to build our business the way we wanted to. By choosing a company with a proven track record, we were able to stay in the lead with the biggest of our competitors."

The next step was to bring in the iPlanet development team to start building a system that would accommodate the application services NDB needed immediately. Led by Park, this team performed a thorough analysis of the existing NDB system and recommended deployment of the iPlanet Application Server on Sun Enterpriseª 4500 servers.

iPlanet Application Server gives NDB the ability to keep growing by offering industry-leading load balancing capability. Not only can load balancing of transactions be done on one server, but also between multiple machines. Without changing any code, NDB was also able to add more machines, thus expanding the NDB.com site capacity. "The iPlanet Application Server allows NDB to move at Internet speed," says Park. "They can build quickly and avoid re-architecting every time a new component is introduced."

Since the iPlanet Application Server embraces the Java 2 Enterprise Edition™ platform standard, NDB will be able to enhance its Web services even further. "With its open-access approach," says Park, "the iPlanet Application Server 6.0 will allow us to provide a J2EE™ platform solution that integrates both pre-built and custom-built extensions to NDB's back-end and legacy systems. Using J2EE, the iPlanet Application Server 6.0 will deliver full interoperability between NDB's existing and planned applications and processes, as well as with those of their partners and customers."

An "overnight" success and ready for the future
"With the launch of the Application Server," Sharenow reports, "we very nearly doubled our usage almost overnight-from 2,200 to 4,000 simultaneous log-ins to our site. The NDB.com website was much faster, more reliable, and more user friendly than before. When the site got the top rating by Barron's and Money magazines, we realized it was a bigger success than any of us had anticipated."

NDB management is so pleased with these results that the company is now looking at several other iPlanet E-Commerce Solutions products, including the iPlanetª BillerXpert. This product will enable NDB to strengthen the loyalty of their business customers by enhancing the convenience of, and control over, bill-processing activities-and by generating new revenues through targeted marketing and cross-selling opportunities.

"Those capabilities are a perfect fit for our business strategy going forward," Sharenow says. "Our past experience has convinced us that iPlanet can deliver the industrial-strength products we depend on. Thanks to iPlanet we don't have to look under the hood any more. We can just focus on what we do best-satisfying customers and growing our business."

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