"No man is an island entire of itself, every man is a piece of the continent, part of the main." - John Donne. The meditation concludes "And therefore never send to know for whom the bell tolls; it tolls for thee."

Without defiling the concept of the poet overmuch, the same concept applies to technology. It's all interwoven and interdependent. Banks and regulated financial institutions are dependent on software provided by third parties. If that third party software goes down, the regulated financial institutions will feel the pain. And there's no getting around this interdependence issue. No firm can be self-contained in its technology.

This interdependence has significant ramifications for the potential direction of financial regulation. Regulated entities are increasingly dependent upon, and interdependent on, technology provided by unregulated third-party technology firms. Will Congress and the financial regulators be content with market forces as the best means to pressure these technology firms to provide the most resilient services or will they opt for more direct oversight? See also House Financial Services Task Force Considers Regulation of Cloud Service Providers.

Commentary 

"No man is an island entire of itself, every man is a piece of the continent, part of the main." - John Donne.  The meditation concludes "And therefore never send to know for whom the bell tolls; it tolls for thee."  

Without defiling the concept of the poet overmuch, the same concept applies to technology. It's all interwoven and interdependent. Banks and regulated financial institutions are dependent on software provided by third parties. If that third party software goes down, the regulated financial institutions will feel the pain. And there's no getting around this interdependence issue. No firm can be self-contained in its technology.  

This interdependence has significant ramifications for the potential direction of financial regulation. Regulated entities are increasingly dependent upon, and interdependent on, technology provided by unregulated third-party technology firms. Will Congress and the financial regulators be content with market forces as the best means to pressure these technology firms to provide the most resilient services or will they opt for more direct oversight? See also House Financial Services Task Force Considers Regulation of Cloud Service Providers.