| 28 December 2009

E*TRADE's (ETFC) powerful desktop application was once on the cutting edge of downloadable trading tools available to retail investors. Launched in 2000, the platform helped create a bridge between much more complicated eSignal-type applications for hyperactive traders and gave "average" but "active" investors tools, speed and capabilities better suited to their trading style.

It was for those same reasons that Charles Schwab (SCHW) purchased the CyberTrader platform in 2000. Those stories would diverge, however, as Schwab eventually decided to jettison the CyberTrader platform in the summer of 2007 whereas we learn today from Theresa Carey at Barron's that E*TRADE has decided to not only keep its platform, but give it a much meeded upgrade as well.

The planned upgrade is taking place now and the old version of Power E*TRADE Pro will still be available until the middle of this year. While it's nice to see the old platform get a new 'do we must remember that this is no longer 2000 or even 2007. The online trading world has seen seismic shifts in the way it delivers products to retail investors.

TD Ameritrade's (AMTD) thinkorswim desktop application rivals anything we've seen thus far and they're rolling out updates monthly, not once a decade. Adobe Air applications, in particular, have transformed platform trading approaches. optionsXpress allows users to create customizable desktops with its OX|Xtend platform and tradeMONSTER users can even create multiple windows (for use with multiple displays, if desired) from within its de facto trading platform.

In part, the E*TRADE enhancements are designed to correspond with the new options symbology initiative scheduled to roll out in mid-2010. Other enhancements include the capability to play video. But we suspect momentum has a lot to do with the decisions made by E*TRADE designers -- they established a strong following early in the game and they are reluctant to dabble with otherwise familiar ground.

Nevertheless, we believe it is an interesting development in the ongoing saga that is E*TRADE. The company has been the subject of buyout rumors for over a year, they recently announced the replacement of their CEO with a new "interim" CEO and they've been working hard to refocus and restructure the company to get rid of bad debt, recapitalize and to refocus the brokerage unit to allow it to do what it does best -- finally.

For more specifics on the new Power E*TRADE Pro product, we invite you to read Ms. Carey's review here.