Google invests $1 billion into CME Group as the two strike 10-year cloud deal

The two organisations will look to deliver expanded access, new products, and more efficiencies for all market participants.

CME Group and Google Cloud have signed a 10-year strategic partnership to accelerate the exchange operator’s move to the cloud, in a bid to transform how global derivatives markets operate with technology. 

Alongside the agreement, Google has also made a $1 billion equity investment in a new series of non-voting convertible preferred stock of CME Group. 

Under the agreement, CME Group will migrate its technology infrastructure to Google Cloud beginning next year with data and clearing services, and eventually moving all of its markets to the cloud.

In a statement, the two companies said the move will lead to expanded access, new products, and more efficiencies for all market participants. 

“Through this long-term partnership with Google Cloud, CME Group will transform derivatives markets through technology, expanding access and creating efficiencies for all market participants,” said Terry Duffy, chairman and chief executive officer, CME Group. 

“To ensure a smooth transition, we will work closely with clients to implement a phased approach. This partnership will enable CME Group to bring new products and services to market faster – all in a flexible and scalable environment that will create a wide range of opportunities for the marketplace.” 

To help facilitate the cloud migration for CME Group, the exchange has appointed Ken Vroman to a new role as chief transformation officer. Since joining the company in 2001, Vroman has held a variety of senior leadership roles including managing director, planning and execution, global head, commodity products and OTC Solutions, and managing director and chief corporate development officer.

“CME Group has a century-long track record of helping investors access new markets and is known for innovation in financial markets,” said Thomas Kurian, CEO, Google Cloud. “Bringing together CME Group’s best-in-class financial talent with Google Cloud’s deep engineering expertise will help accelerate technological innovation in capital markets infrastructure.”

In September 2020, Aquis Exchange and the Singapore Exchange (SGX) partnered with Amazon Web Services (AWS) to prove that trading can be fully deployed on the cloud for cost optimisation and scalability.  

The trio confirmed that they had been successful in developing the proof of concept, which showed that running matching and messaging in the cloud is a viable option.