Thomson-Reuters Won't Roll Over Bloomberg
NEW YORK (MarketWatch) -- Thomson Corp. and Reuters Group, two of the most prestigious names in the news and information-gathering business, are planning to join forces. Naturally, there is lots of talk about synergies and cost savings.
But I suspect that mainly they want to crush Bloomberg. I don't see it happening, though.
When I mentioned my theory to an editor at Reuters, I was greeted with cynicism: . Yes, it's true that I was a Bloomberg News reporter from 1993 to 1999. But the life at Bloomberg can seem so oppressive. Ex-employees have been known to snicker at the company policy stipulating that if you quit the company to go to a competitor, you can't return. The line goes: Why would anyone want to go back?
Rest assured, I have no bias.
M-o-n-e-y
My conclusion is based on what I do know about the private Bloomberg LP, the news and data business founded by Michael Bloomberg in the early 1980s. Bloomberg, who is serving his second term as mayor of New York, has left the day-to-day management of the company, though he continues to own some 68% of it.
What the pundits often overlooked about Bloomberg is that it's not exactly a company about business or finance. It's all about m-o-n-e-y. Whatever information or news the customers want, they invariably get, whether it's new data or coverage of a sector or even the cash-draining Bloomberg TV operation.
Bloomberg TV doesn't throw much of a scare into CNBC or Fox , which is planning to launch its financial network in the fourth quarter. But Mike Bloomberg has kept it on the air because it serves customers' needs; it also provides good market recognition for his company and his aspirations. (There is rampant speculation that Bloomberg will run for president in 2008 as an independent candidate.).
Bloomberg's company has prospered because it is the most customer-oriented company you could imagine.
Its symbol is the Bloomberg terminal, a staple of life in Wall Street trading rooms and elsewhere. It's a dynamic cash machine. According to an otherwise puffy cover story published last month in Fortune, "there are 250,000 installations of this product around the world, for each of which customers typically pay $1,500 a month."
Fortune noted that Bloomberg LP is "smashingly profitable." Its 2006 operating profits, those before taxes, were about $1.5 billion, the magazine estimated.
Numbers don't tell the whole story. If Thomson and Reuters hope to thwart Bloomberg, they'll have to raise their game.
What separates Bloomberg from most media organizations is the ferocious competitive spirit of most of its employees, and that's not only because the company often hands out generous bonuses. Once I witnessed how one reporter refused to leave his post, even though his wife was going into labor.
While it's a matter of debate, to begin with, whether a Canadian company (Thomson) and a British one (Reuters) can work well together, I am wondering more about whether they can forge a competitive zeal to rival Bloomberg.
If it turns out that they can't, this threat will be regarded as insubstantial, like the many other "Bloomberg killers" that have come along in the past 15 years.
Mike Bloomberg's genius was creating a can-do culture. It's all about achieving high productivity -- that's all. Winning awards is nice, and Bloomberg investigative reporters David Evans and Michael Smith have garnered their share of professional prizes in the past year or so.
The biggest prize, though, is to know you've helped sell more terminals in your own small way. The real stars of the company are the people who find new ways to sell Bloomberg boxes around the world.
Bloomberg is kind of the North Korea of journalism, an outpost with its own rules and quirks. Skeptics can say it has higher than average turnover, and I wouldn't argue. Meanwhile, supporters can add that Bloomberg has yet to enac major layoffs, unlike plenty of its competitors.
Some advice for Thomson and Reuters: bring your "A" game and keep it up all the time if you plan to beat Bloomberg.
Allan Sloan
Veteran journalist Allan Sloan, who jumped from Newsweek to Fortune last week, is Mr. Old School. He has no interest in blogging; he doesn't care about the latest trends. He doesn't hang out at celebrity journalist functions, either.
What's wrong with this guy, anyway?
Sloan simply gets by on his brains and intuition when he writes about business subjects. He has few peers.
If there is a silver lining for Newsweek, perhaps his exit will convince its top editors to pay more attention to business news.
When it comes to reporting on politics and social issues, Newsweek shows great skill and vigor. But its top management seems to regard financial news as some strain of kryptonite. (Quit smirking, Time magazine editors -- you folks are no more dedicated to covering business.)
This is a coup for Fortune as it competes against Portfolio and others. Sloan had an opportunity to join BusinessWeek a few years ago, but decided not to pursue it. Now, Fortune's gain is Newsweek's loss.
MONDAY REPORT CARD: Plenty of business journalists covered the TV-news ratings like they were attending baseball games, concentrating on the final scores. There wasn't much analysis about what it means that ABC and anchor Charles Gibson had, for now, overtaken NBC and Brian Williams. I'd hope that networks would take their cues from ABC's low-key, news-first approach. Pssst, it works!
THE READERS RESPOND to my column about blogger Elizabeth Spiers: "Enough about me, let's talk about you. What do you think of me? A former boss says 'She can get bored because her mind is always on to her next project.' In the old world, this would mean 'she's either too dumb or too self-involved to finish a job.' However, with most bloggers being on the young side, we live in a world where every kid gets a balloon, and every runner in the race gets a pretty ribbon. And we wonder why that world seems to get dumber and dumber." Chris Maynard
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By Jon Friedman