Think web 2.0, brokers told

Traditional investment companies have been encouraged to look into using web 2.0-style services to avoid losing out to newer niche players.

According to analyst house Gartner, more traditional brokerage companies with online trading services should look at using technologies such as RSS, blogs and community sites to cater for a new generation of customer.

Dave Schehr, research director at Gartner, told silicon.com that newer companies are already providing these kinds of services for investors to use to access information.

silicon.com Financial Services

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He said: "The focus is more on the community, on peer-to-peer sharing of information and the facilitating, corroborating and validating of that.

"It's really using web 2.0 in a native fashion. It's not just another means of doing the same thing we used to do in the physical world, electronically."

Schehr said more established web-trading businesses tend to view the internet as another way of delivering the "same kinds of things that are delivered through other mediums and other forms of communication".

For example, many companies still use PDF documents to distribute information. Schehr said: "It's still, in essence a print document that's just being shown in electronic form."

Although the newer companies are targeting niche markets rather than competing with large businesses, Schehr said bigger enterprises could nevertheless benefit from web 2.0.