| Headline: Jerry Putnam: CEO, Archipelago Source: Euromoney Date: July 2000 Author: Kay Binnie The Electronic Communications Network (ECN) industry is violently competitive, with the 12 market players battling to eliminate each other. ECNs are private trading systems that fill orders by matching buyers and sellers and they deal primarily in NASDAQ stocks. However according to Jerry Putnam, CEO and founder of Archipelago, the fourth largest ECN in the US market, ECNs are a moment in history and a catalyst for change. The real battle lies in taking on the stock exchanges. While ECNs have been doing some of the business of stock exchanges, key legal distinctions remain. You are either a stock exchange or an ECN. Not surprisingly, the stock exchanges are reluctant to relinquish their pre-eminent and monopolistic status, The economic advantages of being a stock exchange are considerable. But in a move that puts him strategically ahead of the competition, Putnam has struck a deal with the Pacific Stock Exchange. The 552 members of the exchange voted to close their equities trading floor and hand this business over to Putnam, in return for a 10% stake in Archipelago. |