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There was a time when daily prices for US Treasuries were hand-written on two or three sheets of paper from a yellow legal-pad and run by messenger to the Associated Press and Dow Jones. The AP needed the prices early enough to send to their members and Dow Jones was under pressure to make the deadline for the Wall Street Journal and their newswire. The messenger couldn’t wait for the closing prices. They had deadlines. No. A clerk would scribble the list furiously and send it off – smudges and all.
Bloomberg called it the modern day pony express. It wasn’t far off. Some poor runner would bolt into the respective newsrooms, hand over a precious few sheets of paper, and watch the operator enter the prices into their system. But in 1987, Bloomberg would change that.
Bloomberg’s terminals had found a quiet niche in the aggregation and analysis of Treasury pricing data. It had so much data that it had beat the Fed. Bloomberg had better, more up to date data than the Federal Reserve. It’s prices were more reliable than the Federal Reserve. What followed was perhaps one of the finest coups of earned media in history.
Rather than rely on legal pads and couriers, why not wires? Why not a Bloomberg terminal? The AP and Dow Jones each took at terminal. They got better data. They got closing prices. And each day, they ran a full page of Treasury prices, courtesy of the terminal and credited to Bloomberg.
Lesson learned: if you want media, earn it.
From our first day in business, Bloomberg was making news, with numbers
—Mike Bloomberg and a modest ambition
While most news organizations today are listing in the high seas of the digital world, Bloomberg News has proven to be an adventurous and successful competitor. They started with a key asset, the Bloomberg terminal, and a gaping niche – business journalism. As it has grown, it’s become an instrument of recognition for the entire Bloomberg enterprise, a sales tool, and a critical hedge against competition.
Bloomberg seems to have demonstrated that it’s possible to make money from reporting the news. It’s a fierce competitor to the Wall Street Journal, Reuters and other business reporting. It runs a thriving business. But Bloomberg isn’t interested in selling news feeds. Indeed, much of it is given away for free on the web portal. Bloomberg gives it away because it wants to eliminate the profit margin in delivering the news, so it can starve competitors and enhance the value of the terminal. It wants to make the news a commodity.
Bloomberg’s entry into journalism would push traditional news sources to improve their coverage and respond to Bloomberg News. The underlying dataset in the Bloomberg platform gave them a distinct informational advantage over the competition. The information and analytics on financial instruments was just not widely available and not something on which traditional news sources had focused. As Bloomberg says, they were already in the news business – just with numbers. The terminal had become, for example, the de facto source of pricing for US Treasuries and replaced the Federal Reserve’s daily pricing sheet with a Bloomberg terminal at the offices of the AP. Each day, when the AP published the closing Treasury prices, sourced and attributed to Bloomberg, they were effectively running a news story, or an advertisement – take your pick. This unique resource separated them from the competition, gave them pricing power and promoted the terminal – all in one stroke.
Business journalism at the time also lacked the luster of reporting on riots, elections, and wars. Journalism schools didn’t teach business and finance reporting. The mainstream, national press would gloss over financial markets on the way toward bigger stories. As Bloomberg remarks, “Even at the Wall Street Journal, it was rare to find top editors who included among their accomplishments daily stints covering stocks and bonds.” Bloomberg News would enter a seemingly uncontested field. In 1988, Bloomberg marshalled Matt Winkler to enter the fray.
Bloomberg News also provided a much-needed hedge against the possibility of losing key news-suppliers, such as Dow Jones. Bloomberg had already eaten into the Dow Jones Telerate business. While Telerate presented static images of Treasury prices, Bloomberg users were presented with live data on which they could run analytics. When Dow Jones did respond, they pulled the plug on their feeds to Bloomberg, expecting that Bloomberg customers would come back to Telerate and abandon the Bloomberg platform. It turned out that clients found Bloomberg News sufficient: at worst, good enough to get the job done and, at best, invaluable in combination with the underlying dataset. Dow Jones eventually relented six months later and resumed delivering their feeds through the Bloomberg platform. Telerate would later be shut down.
The rapidly growing news enterprise advanced and protected the Bloomberg franchise. It spread the reputation and influence of the Bloomberg organization, and this sold more Bloombergs. More Bloombergs funded more news, and Bloomberg news became increasingly visible beyond the terminal. It worked its way into radio and television first. Then it began traditional print syndication, and syndication brought Bloomberg’s business reporting to the New York Times, among others. With these outlets, the Bloomberg brand became more prominent, more potent. It sold more Bloombergs.
The news division at Bloomberg was never designed to sell the news. It was designed to sell Bloombergs. It started with a market niche and a key asset – business reporting and the terminal. But it rapidly evolved into an important hedge against the risk of key suppliers, such as Dow Jones, cutting off Bloomberg as a customer. When Dow Jones dared to do so, Bloomberg had won. Bloomberg news was good enough to be a substitute or an improvement on most serious business and financial reporting from Reuters, the Wall Street Journal, the FT, the New York Times, and anyone else who might have contact with their customers. Business and financial news reporting, at first an area of distinction for Bloomberg, had become a commodity.
Because Bloomberg doesn’t need to sell the news, those that do are at a disadvantage. They rely on profit margins from distribution, sales and subscriptions to the news. Bloomberg doesn’t. Bloomberg makes money through subscriptions, but they’re subscriptions to the terminal. The news is just another commodity, and it suits Bloomberg just fine to see it have commodity-margins. It just makes the terminal more valuable.
[The portals] have made assumptions about using our content which are wrong, and we are prepared to demand appropriate compensation.
—Tom Curley, President and CEO of the AP, which now comprises 1400 member newspapers, and former publisher of Gannett’s USA Today: via WSJ
This is about what content providers must do in the digital era. That starts with doing a much better job of protecting the content we create
—Tom Curley, AP: via FT
Thomson Reuters and other news agencies have begun working with third-party content identification firms such as Attributor to track the flow of their material across blogs, websites and aggregators. [FT] Any time you talk about a tracking system, the thrust of [the commentary] is about enforcing copyright. But what we hope is the outcome out of this is the ability to enable more licensed uses of content. We want to keep the content open, we don’t want to keep it behind firewalls.
—Jim Kennedy, the AP’s VP of strategic planning: All Things D
What we are building here is a way for good journalism to survive and thrive. The AP news registry will allow our industry to protect its content online, and will assure that we can continue to provide original, independent and authoritative journalism at a time when the world needs it more than ever.
—Dean Singleton, chairman of the AP Board of Directors and vice chairman and CEO of Media News Group Inc, Fair Syndication Consortium and Attributor: via World Editors Forum
Nice container. Because they need it to protect such impressive stories as this.
[The portals] have made assumptions about using our content which are wrong, and we are prepared to demand appropriate compensation.
—WSJ: Tom Curley, President and CEO of the AP, which now comprises 1400 member newspapers, and former publisher of Gannett’s USA Today
This is about what content providers must do in the digital era. That starts with doing a much better job of protecting the content we create
—FT: Tom Curley.
AP, Thomson Reuters and other news agencies have begun working with third-party content identification firms such as Attributor to track the flow of their material across blogs, websites and aggregators. [FT]
Any time you talk about a tracking system, the thrust of [the commentary] is about enforcing copyright. But what we hope is the outcome out of this is the ability to enable more licensed uses of content. We want to keep the content open, we don’t want to keep it behind firewalls.
—All Things D: Jim Kennedy, the AP’s VP of strategic planning
What we are building here is a way for good journalism to survive and thrive. The AP news registry will allow our industry to protect its content online, and will assure that we can continue to provide original, independent and authoritative journalism at a time when the world needs it more than ever.
—World Editors Forum Dean Singleton, chairman of the AP Board of Directors and vice chairman and CEO of MediaNews Group Inc