Reuters Takes Enterprise IM Award

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The information security officer at a large investment firm was being pulled in two different directions over instant messaging.

Brian Erdelyi, head of security at Blackmont Capital Inc., needed the company's traders and advisors to use an enterprise-level IM for better security and to meet strict Canadian regulations for storing communications. His users, however, wanted to be able to message with clients and colleagues using the more popular AOL and MSN software.

The answer was the gateway that was built into Reuters Messaging 5.0, the winner in the Enterprise Instant Messaging category of the Datamation Product of the Year 2006 awards. The gateway, new to this version of Reuters Messaging, was designed to allow users to communicate seamlessly with people using AOL's and MSN's instant messaging products.

''There has been a huge increase in our investment advisors needing to communicate with their clients over MSN and AOL because that's what their clients are using,'' says Erdelyi, who safeguards Blackmont Capital's 650 employees working in 11 cities across Canada. ''The gateway was exciting. I had a lot of users at the time and some high-profile users wanting to communicate with their clients who were on one of those two networks. I was able to give them a solution they were comfortable with and still adhere to our regulatory requirements.''

Reuters, long known as a media outlet, has turned some of its attention to supplying information to the financial markets. The company first released Reuters Messaging in 2002, designing it as a specialized product for the financial sector. The November 2005 release of Version 5.0 brought the addition of hosted, secure chat rooms that can connect to internal and external communities. It also added the gateway to MSN Messenger and AOL services.

''Why should we care to communicate with the consumer world?'' asks Eran Barak, the global head of strategy for Reuters, which is based in London. ''There's professional and personal reasons. There are some professionals who still use consumer IM, not because it's a good fit to their needs but because it was the only product available at the time.''

The drawback to connecting with consumer IM services is the loss of some security measures.

Security is a major reason that many companies implement enterprise IM packages. Messages traveling across a closed IM network can be encrypted, and there's added assurance because the messages don't travel across a public -- and more easily accessed -- network. Once an enterprise IM service connects with an open, consumer service, some of that security is lost, according to industry analysts.

''There's always a a tradeoff between [security] and the desire to communicate,'' says Dr. Sarah Radicati, president and CEO of The Radicati Group, Inc., a technology market research firm based in Palo Alto, Calif. ''What Reuters is doing correctly is giving people the choice... Companies need a trade off. There are going to be situations where you want to have a communication in a most secure manner, and then there will be times when you want to have initial contact and that doesn't have to be as secure or regulated and that can happen on these other networks.

''It always comes down to company policy,'' she adds.

And Erdelyi agrees that it's a matter of having policies in place to add on another layer of security. Blackmont Capital has policies governing what kinds of information can and can't be transmitted over email and instant messaging.

''Unfortunately [when communicating with public IM services] we do lose some security,'' he says. ''Normally, if we were communicating with another Reuters Messaging user, the communication would be encrypted. However, when we communicate with the public networks, it's not encrypted and very similar to email. It worried me from the perspective that I don't want our advisors to be putting confidential information in there that could be captured in transit. But just like with email, we're not supposed to be disclosing confidential information through email. So we treat IM in the same way we treat email, and our policies don't allow the transmittal of confidential information.''

Erdelyi also notes that Reuters Messaging 5.0 allows him to easily capture and store IM communications, keeping the company compliant with federal regulations.

''That's one of the greatest advantages for me. We are able to log all of those messages,'' he says, adding that the Reuters product captures the messages and then they store it in their own email archiving system. ''We wrote a program that extracts all of the messages from the Reuters log server and we forward that to our email archive. Now our compliance officers see the messages no differently than they see the email.''

Radicati says Reuters will start to see some increased competition from the big three public IM players -- MSN, AOL and Yahoo, which she predicts will soon begin adding more security and regulatory-based features. Despite that increased competition, she says Reuters is well situated to deal with it.

''They certainly have a good product,'' says Radicati. ''They have a certain command of their market, as well. In several sectors, they have pretty strong market penetration.''

In the race for Datamation's Product of the Year award, IM Manager SMARTGig 6000 from Imlogic, Inc. came in second. In third place was e/Pop IM Server 3.0 from WiredRed Software, and Perimeter Manager for IM from Postini, Inc. came in fourth.

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