A new report from Greenwich Associates, 'Market Structure Changes Drive New Demands in OMS/EMS Technology', estimates annual buy-side spending on order management systems (OMS) and execution management systems (EMS) has increased 10% over the past two years.

Greenwich Associates asked 424 institutional investors globally about their use of OMS and EMS systems and other trading technology.

Among those polled, Bloomberg received the most mentions as an EMS and OMS provider. Charles River Development followed Bloomberg in OMS and ITG followed in EMS. ITG, Advent Software and Eze Software Group rounded out the top five in OMS while Charles River Development, Advent Software and FlexTrade were the five most-mentioned providers of EMS.

While many technology vendors offer systems marketed as OEMS, or integrated OMS and EMS, the Holy Grail of a truly integrated OMS/EMS system, however, has yet to arrive, says Greenwich.

"Many of the platforms marketed as OEMS function more as side-by-side OMS and EMS as opposed to truly integrated solutions," says Greenwich Associates analyst Kevin Kozlowski. "Today's integrated platforms are used by only about 30% of institutions we interviewed and to date, the use of comprehensive, end-to-end systems has occurred primarily among smaller institutions and hedge funds."

A combination of cost pressures, compliance demands and liquidity fragmentation is driving increasing demand among larger buy-side institutions for integrated OEMS, he says.

Bloomberg, Charles River and ITG are all currently working to develop scalable integrated systems for the bulge-bracket end of the market. But Kozlowski cautions that the effort required to achieve true integration will be a complex undertaking requiring "significant experimentation and investments in R&D".