BLOOMBERG: THE NEXT MOVE (AKA ITS MY WAY OR THE HIGHWAY)

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Old Chinese saying, “A journey of a thousand miles starts with a single step”.

Bloomberg LP is well into a business journey since founded in 1981, but it does help if you know where you are going. On many levels the company has re-defined the financial information industry to the extent peers are benchmarked relative to Bloomberg, which in itself has been moulded into its founder’s image, Michael Bloomberg.

As a private company Bloomberg has the luxury of being able to take long term decisions, and carry them through, without interference from activist shareholders fixated upon short term gains. The down side is a lack of accountability and scrutiny from outside investors demanding that management justifies its strategies.

Only Gods are Immortal, which begs the question how long can Bloomberg’s incumbent management continue, and what is their end game? Bloomberg faces key challenges:

  • Growth in its terminal business has essentially stalled, and the terminal market looks to be in long term decline
  • Bloomberg’s other business areas such as feeds, reference data, regtech, are far more competitive, but growing
  • New technology is threatening to disintermediate aggregators as data consumers become more discriminating
  • Bloomberg’s inhouse technology is legacy, but its ‘private cloud’ type structure could yet prove a bonus
  • Most of all, how is Bloomberg LP’s future strategy going to evolve in the midst of a new information revolution?

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