Introduction - The long, long road ahead

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Introduction - The long, long road ahead

Wholesale financial services firms have made great play of their internet ventures in the last year, seeking to present themselves both as being internet-enabled and as pioneers in reshaping financial markets. Yet in reality few firms have done any more than take their traditional businesses and put them online. The true capacity of the internet to transform financial market structures has yet to be unleashed, although pure trading is changing fast. Maybe some of the self-styled pioneers want to hold this transforming power in check. They won't succeed for long, reports Antony Currie

When employees at JP Morgan arrived at work on June 14 they discovered a problem. All of them discovered a problem. Their e-mail system wasn't working, nor was their web site.

The cause of this complete shutdown was embarrassingly simple. The bank had neglected to pay its webservice registration fee to its site and e-mail provider, Network Solutions. The bill fell due in early May. Three bills were sent to JP Morgan, all them either ignored or misplaced. So Network Solutions did what any service provider does when not paid a debt: it pulled the plug.

It's an embarrassing incident for JP Morgan, the bank which has put itself at the forefront of the e-commerce revolution, creating LabMorgan as a separate unit whose raison d'être is to think of ways to cannibalize its existing businesses. It's also bad luck for the firm that it was singled out. A day later the head of e-commerce at another US investment bank admitted that it could have happened to any of them. "Of course it made us laugh, but the next thing I did was to make sure that our subscription was up to date. And I'm sure I wasn't the only one to do it."

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