High Frequency Trading technology comes to China...for buying train tickets...

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A bit outside of our normal commentary, but an article sheds light on how low-latency technology is important in China, but for buying train tickets.

Chinese New Year every year is the world's largest mass movement of people. Every year, over a billion people will travel to or from families all across the country to celebrate the Chinese New Year. For the lucky few who can afford the holiday ticket pricing, this involves flying, but for many, they will need to take the train.

Historically, train tickets were sold either at the train stations or at approved railway ticket shops throughout major cities. Tickets go on sale a predetermined time before the actual train, so there can be huge queues in the days leading up to Chinese New Year and major holidays, and the most convenient trains sell-out rapidly leaving travellers with little choice but to take a mix-match of trains home or not to be able to travel at all.

This situation started to alleviate itself as a lot of the ticket selling has moved online, but, similar to scalping queuing tickets at a hospital, there are certain people that are happy to take advantage of the situation by reselling the tickets. Now moving beyond just sitting in front of a computer to click faster than their compatriot, the Nanfang reports on scalpers that are using remote servers to get a lower latency connection.

Sites like 12306.cn handle the majority of online ticket sales in China and in certain cases, touts are spending the equivalent of about $15 / day for access to a server sitting in a Beijing Telecommunications datacenter for faster access to 12306, also in Beijing. There are no guarantees that it will result in better ticket selection or shorter wait times, but judging from the reaction on social media, it seems to be getting interest regardless. Thus some people are able to access better tickets and then go on to resell those tickets for presumably a hefty mark-up. 

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