A lot of investment banks are using open source software, but techies shouldn't worry

One of the more interesting revelations to come out from the (imminently decided upon) Sergey Aleynikov trial is that Goldman Sachs' code may not even have been worth stealing.

Benjamin Goldberg, an associate professor in New York University's computer science department, testified that the code Aleynikov took contained "lots of open source software".

Or, as Aleynikov's lawyer Kevin Marino said: "The general common notion that Goldman Sachs is the New York Yankees and Goldman's systems are the best ain't necessarily so."

This raises the question of whether high frequency trading should really be paying such large sums for these investment banking whizz kids - Aleynikov was offered a package worth nearly $1.2m at his new employer, HFT firm Teza Technologies.

But, it also seems strange that an investment bank that spends hundreds of millions of dollars on IT every year to gain a competitive advantage would use technology that was freely available to all.

The use of open source technology within the investment banking industry is more common than you'd think. Its use was picking up pace last year - with JPMorgan, Morgan Stanley and RBC Capital markets all participating in open source tech projects.

And, it's now "quite common" for investment banks to use open source technology, suggests Kevin McPartland, senior analyst at TABB Group.

"Use of MySQL and the Apache web server continue to see usage grow and their functionality allows them to reliable in enterprise situations. Financial services specific open source platforms are also growing - these include projects such as QuickFex and QuantLib," he says.

But Peter Redshaw, managing vice president at Gartner, suggests that most banks would generally be "extremely resistant" to using open source code for front office applications.

"Many investment banks are developing a hybrid approach to sourcing their code, some of which will come from open platforms," he says. "But this is more around back office processes - something you can rely on to be performed accurately, but won't give you a competitive advantage."

Moreover, open source technology is likely to make life a little easier for IT workers in investment banks, suggests McPartland.

"Open source can lower the learning curve for new employees as they are more likely to be familiar with these packages as opposed to commercial software that might not have been in use at a previous job," he says. "It also allows programmers to focus on value added technology - risk models or trading algorithms for example - as opposed to more utility functions like messaging and basic order management."