Ex. 1: Spread Networks

Spread Networks is a fiber optic cable company that developed routes and cables for data transmission between New York/New Jersey and Chicago. It saw an opportunity to develop a “Golden Route,” which would be the fastest of any cable between New York and Chicago. CEO Dan Spivey realized Spread Networks had the resources to develop this Golden Route. Spivey realized, “that there was a big difference between the trading speed that was available between these exchanges and the trading speed that was theoretically possible” (Lewis, 2014, p. 9). Spread Networks’ goal was to shave off the time and distance for information travel. The average time it took for information to travel was about 17 milliseconds, but it believed they could have its line complete the route in 13 milliseconds. It may seem like a small difference, but several trading firms in Chicago and New York would pay for the line.

The speed of data gave this firm an opportunity to profit greatly from the demand of speed. The exchange “exists as a complicated network of interested parties who all work to achieve their own interests with and through it, changing it at every turn” (Sandvig, 2012, p. 191). Wall Street businesses now extend beyond trading firms that serve investors; they now include communication-based services that compete for speed. Spread Networks is an example of a company that saw the change in Wall Street as an opportunity to profit from the demand for high speeds. Spread Networks has no stake in any investing activity that occurs on Wall Street, rather it is a service that aids firms in investing activities. Spread Networks is an example of a company that adjusted its products to meet the speed demands of HFT firms; it built an entirely new fiber-optic route to shave milliseconds off data travel. They did this in spite of the fact that it had to deal with contractors to build the line entirely underground through private and public spaces. The hassle and costs paid off, as it are able to charge thousands to firms for the opportunity to connect to their line.