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LISA NAPOLI: A new law in the European Union is opening up the business of stock exchanges to competition. Plans for a rival to the London Stock Exchange are progressing by a consortium of banks. Alisa Roth explains why the more established exchanges might want to watch out.

ALISA ROTH: Project Turquoise is the nickname of a proposed alternative trading system or ATS.

It’s essentially a new kind of stock exchange. It’s owned by seven banks you might just recognize — names like Goldman Sachs, Merrill Lynch, Morgan Stanley . . . you get the idea. And it plans to compete against the likes of the London Stock Exchange.

David Easthope is an analyst at consultancy Celent. He says this ATS might have an edge.

DAVID EASTHOPE: It is a real threat. This is one of the potential ATS that could be the most significant threat to the traditional exchanges because it could get big very quickly.

Easthope says upstarts like Project Turquoise believe they can outwit their stodgy elders, and make it cheaper to trade stocks. Low-cost new technology could make that easier.

The Project Turquoise banks say it’ll be up and running before the end of the year.

Competition already seems to be getting nervous. The London Stock Exchange recently cut its fees by about 10 percent.

In New York, I’m Alisa Roth for Marketplace.