In 1989, Reuters the legendary international
news agency based in London launched an
ambitious and secretive project.
Bloomberg, a relatively young New Yorkbased company,
had been eating into Reuters market, providing analytics
and data to Wall Streets Masters of the Universe via
proprietary terminals. Dubbed Decision 2000, the projects
goal was no less than the destruction of Reuters
competitor and its terminals.
But to beat Michael Bloombergs brainchild, the legacy
brand first needed to rival it. Reuters tasked Capital Market
Decisions, a firm led by ex-Smith Barney executive J. Stephen
Levkoff, with developing an investment analytics system on par
with the one luring away clients. Reuters played hardball
but it also played dirty, evidence suggests: In the late
1990s, federal prosecutors obtained more than 100
communications between Reuters officials and a consulting
company that investigators believed was hired to steal
information from Bloomberg, according to The New York
Times. But the alleged Watergate tactics failed, as would
It was the first product to be dubbed a Bloomberg
killer, and that was unfortunate, says Douglas Taylor, a
former Reuters executive who worked on the project. It
wasnt a bad product, but it wasnt a Bloomberg
In 1993 relations between Reuters and Capital Market
Decisions soured. The project collapsed; lawsuits ensued;
accusations of intellectual property theft were lodged.
And Bloomberg remained.
Since then a handful of other products have taken on the
mantle of Bloomberg killer. So far none has succeeded. Up
to this point, any so-called Bloomberg killer has ended up as
roadkill itself, says Taylor, who now runs his own firm,
Burton-Taylor International Consulting.
Yet large-scale shifts in banking and money management
including compressed margins and, correspondingly,
shrinking information-service budgets are causing a
mature Bloomberg more pain than copycats ever did. Its terminal
count has barely risen over the last five years, according to
Burton-Taylor. And last year, for only the second time in the
companys 35-year history, the terminal total shrank.
(Bloomberg doesnt have physical terminals anymore, but
rather a software package officially named Bloomberg Terminal.)
At the same time, another generation of upstart competitors,
including Money.net and Symphony, has emerged.
Can anyone finally bury Bloomberg?
The basic complaint about Bloomberg is its
price always, forever, infuriatingly, the
Whether Ray Dalio or Ray Daytrader, everyone pays the same
price: $25,000 a year for one terminal and $22,600 a year per
terminal for more than one. No discounts are available.
Ive been a Bloomberg user for close to 25
years, says Seth Shalov, a partner and portfolio manager
at $4 billion MAI Capital Management in Cleveland. And
for 24 years, I have been frustrated with their pricing.
Bloomberg declined to comment for this story.
Banks, of course, have faced economic struggles since the
financial crisis, making Bloomberg terminals an onerous
expense. And many money managers are seeing less revenue amid
the shift to passive investing and general pressure for lower
fees, putting their budgets for information services under
JPMorgan Chase & Co. CEO Jamie Dimon complained in a
recent letter to shareholders that his bank paid $9 billion for
its technology services in 2016 a sum about twice the
gross domestic product of Fiji. For many financial services
firms, information technology is the biggest expense after
Its no wonder, then, that Bloombergs terminal
volume climbed only 0.7 percent annualized over the last five
years, and that it shrank 0.96 percent last year, to 324,485,
according to Burton-Taylor.
But a large number of financial market participants see
Bloomberg as an absolute necessity, regardless of the cost.
Its basically a way of life for many people,
says Bloomberg user David Gilmore, a partner and currency
analyst at Foreign Exchange Analytics in Connecticut.
Bloomberg provides one-stop shopping for data, analytics,
news, and trading. Bruce Falbaum, who invests in high-yield
bonds and leveraged loans as a senior portfolio manager and
principal at $1.6 billion Cohanzick Management in
Pleasantville, New York, has used Bloomberg for 20 years.
Hes not looking to make a change now.
For the things it does, I dont find anything
that really compares though, honestly, I havent
looked, Falbaum says. Market makers post high-yield bond
prices and send traditional communications to customers like
him over Bloombergs messaging system. I see the
entire market going on in front of me on Bloomberg. Im
not aware of any other place where I can do that.
Cohanzick has six Bloomberg terminals and would love to trim
the expense. Thats real money for a firm like
ours, Falbaum says. But a replacement would have to
include the same capabilities he and his colleagues enjoy on
And just as important, the other players in his market would
have to adopt the new service as well, so he could continue to
communicate with them. We have relationships with about
100 broker-dealers, Falbaum says. I can use a
scraping function to see their quotes that are contained in
messages, and then I can contact them to potentially do a
trade. Thats all on Bloomberg. It would be very
difficult for a competitor to gain a critical mass of users, he
One complaint lodged against Bloomberg by competitors such
as Money.net CEO Morgan Downey is that the terminal is
difficult to use clunky, as Downey puts it,
citing outdated software and the lack of touchscreen
But only one of the 16 Bloomberg users contacted for this
story echoed Downeys complaint. A market analyst, who
requested anonymity to avoid alienating Bloomberg, says that
when he is looking for an old news story about a specific
event, he can often find it more quickly with a Google search
than by going through Bloomberg hardly a fatal flaw in
Bloombergs front end is antiquated, Taylor
says. But regardless of how cumbersome it is, you still
get the best result on the street. From Bloomberg users,
almost all the complaints focus on price.
Some say they are open to switching, or at least adding a
competitor to Bloomberg. One is the co-head of portfolio
management at one of the countrys largest money managers,
which only communicates anonymously to the media and utilizes
85 Bloomberg terminals. He has great respect for the
Bloomberg is a very fantastic product, he says.
In addition to the terminals capabilities, Bloomberg is
extremely customer-centric, he says. They are
focused on improving their products in any way that users find
meaningful. They have earned a spot in our ecosystem.
But his firm would love to find an alternative to the
colossus. First, theres the $1.9 million its paying
each year for its Bloomberg terminals. The per-terminal price
has climbed 25 percent over the past ten years, the
executive says. People are concerned about price, but the
more inextricably linked you are to Bloomberg, the more you
realize you have to pay that price, he says. There are
competitors in narrow areas with products his firm views as
superior to Bloomberg. The firm pays for those services in
addition to Bloomberg.
Another reason the firm would like an additional
full-service solution is to avoid complete vulnerability to a
Bloomberg network outage. Such a breakdown occurred for a few
hours in April 2015, effectively shuttering parts of financial
markets around the world. We are actively looking for an
alternative to Bloomberg, because we feel like a competitor
even if its just for a piece of the business
is in our best interest, the executive says.
A friend of his who is the head trader at a global macro
hedge fund recently switched to Money.net from Bloomberg for
all nine of the firms traders. The head trader declined
to identify himself or his fund. He told me that knowing
the work I do, if I spent six weeks using Money.net, I would
forget about Bloomberg, the executive says.
Money.net and fellow new entrant Symphony have
been all the rage as of late to the financial
media, at least.
Money.net, built by ex-Bloomberg commodities chief Downey,
charges $150 per month, or less than 10 percent of
Bloombergs fee. Downey, 44, grew up on a farm in Ireland.
After graduating from the University of Limerick, he ventured
to New York City, where he found a job as a junior fixed-income
derivatives trader at Citibank. He later specialized in
commodities, and after working overseas for Citi and Bank of
America, he joined Bloomberg in 2010 to lead its commodities
He had used Bloomberg since the beginning of his career in
1993. But even then I thought it was old, Downey
says. Seeing that after the financial crisis users were
increasingly concerned about Bloombergs pricing and
sensing they were disappointed with the terminals
technology, I figured I could build a better system at
one-tenth to one-fifteenth of Bloombergs cost,
Downey says. And so he went to Money.net in 2014.
He and other top managers own a majority stake in the
company. Outside investors include former Citigroup CEO Vikram
Pandit and Michael Litt, a money manager featured in Michael
Lewis book The Big Short.
Downey claims his service provides all the data Bloomberg
and Thomson Reuters do (Thomson Reuters occupies the No. 2
position in the financial information market, with a 23 percent
share, compared to 33 percent for Bloomberg, according to
When it comes to analytics, ours is more intuitively
delivered than Bloomberg and Thomson Reuters, he says.
They are spread thin with low-usage analytics, while we
take the main 30 to 40 functions, like options analytics, and
make them exceptional.
Rather than start its own news division, which would
represent a major expense, Money.net pays for the news of The
Associated Press, MT Newswires, Fly on the Wall, and others.
Last year the company hired Norman Pearlstine, vice chair of
Time Inc. and a former top news executive at Bloomberg and Dow
Jones, as its chief information architect.
Money.net isnt just marketing itself based on price.
Ease of use is key, Downey says. We dont think you
should need a university course to learn how to use the service
like at Bloomberg. Bloombergs system was designed
in the 1980s and hasnt really changed, he says.
Its a garbage heap of functionality that has been
Downey harbors a certain dismissiveness toward his former
company. Its founder Michael Bloomberg should just IPO
and go home, he says.
Money.net should be particularly attractive to younger users
who have no historical attraction to Bloomberg and are put off
by the difficulty of using it, Downey says. However, Taylor
notes that younger finance workers will want to use the same
tools as their more senior brethren. I havent seen
any evidence of a new generation of financial players that will
drive the market away from Bloomberg, Taylor says.
If Im paid for performance, Ill want the
tools that work best.
In addition to the traditional market base of Wall Street
players, Downey sees an opportunity to bring financial
advisers, corporate treasurers, and people in investor
relations to Money.net. These are people who have never
seen a Bloomberg or who share one, he says. There
is a market that will never pay $20,000 to $25,000 a year for a
terminal, but will pay $4,000 for one that helps
David Bullock, founder and president of registered
investment adviser Arque Advisors in Rye, New York, is one of
those financial advisers. He began using Bloomberg more than 30
years ago in a career that has included stops at Lehman
Brothers and Greenwich Associates.
Like others, he thinks Bloomberg is brilliant,
but is put off by its price. As a small firm, every
nickel makes a difference for me, and I dont do complex
modeling. While some Bloomberg programs are dated,
Money.net has it cold in equities, futures, and
derivatives, Bullock says. He sees Bloomberg as overkill:
I believe about 80 percent of Bloomberg users use less
than 20 percent of the capability of the
Yet of the more than 20 people interviewed for this story,
only about half had heard of Money.net. They havent
done a real good job marketing, Bullock says. Money.net
says it has more than 50,000 users.
Taylor doesnt regard Money.net as a true threat to
Bloomberg. It seems like a great service, he says.
Theres an opportunity for a lower-cost data vendor.
They have that exactly right. But bankers and portfolio
managers with millions of dollars on the line will want to
stick with Bloomberg, he says.
Thats because it has more data and features than
Money.net, which still has to prove itself. The biggest money
managers arent interested in the $20,000 a year they
could save by forgoing a Bloomberg for Money.net
theyre worried about putting millions of dollars in their
portfolios at risk, Taylor says. Making a change is not
just about budget. You have to know the sources of information
are as good and the function and support are the same.
(Taylor agrees with Downey that Money.net is perfect for small
asset managers, financial advisers, and C-level executives who
need some level of financial content at a low cost.)
Another ballyhooed competitor to Bloomberg is
Symphony, a messaging service started three years ago
by 15 financial institutions, including JPMorgan Chase, Goldman
Sachs, and BlackRock. Google has also invested in the company,
which has raised $233 million.
The financial institutions were concerned about
Bloombergs virtual monopoly in messaging. Many traders
and money managers use Bloombergs messaging service as
the main form of communication with their counterparts in
Goldman in particular was upset with an incident in 2013
when a Bloomberg reporter tracked the terminal usage of one of
the banks employees. Symphonys aim was to create a
messaging service with better encryption and more transparency
The company charges $15 per month, and its CEO, David Gurle,
scoffs at comparisons with the market leader. I
dont view Bloomberg as a competitor, unless they change
to be a communications network, he says. To the
extent they do the same things, they are a competitor, but
their focus remains on being an information services
provider. Messaging is just a part of that.
Symphony wont build a full terminal service like
Bloomberg, Gurle says, though users can add other services to
their Symphony platform for an extra charge, including Dow
Jones, FactSet, IHS Markit, and Money.net. Users of Money.net
can also access Symphony. And in June, Symphony and Thomson
Reuters signed an agreement to integrate each others
Anthony Kennedy, Miami-based chairman of Autumn ai, a Zurich
currency-trading firm, uses Money.net and Symphony. As a
self-proclaimed data nerd, he likes Symphonys
signal-based messaging. Its a light platform that a
lot of financial technology will plug into nicely rather than
needing a huge financial terminal, he says.
He thinks the combination of Money.net and Symphony could
turn into a Bloomberg killer. My Bloomberg is mostly
gathering dust now, he says. He still uses it for
research on real estate and civil proceedings, but thinks
Money.net and Symphony will join forces to provide such data in
the near future, making his Bloomberg terminal superfluous.
Gurle says Symphony is in partnership discussions with
Money.net that could end up with Symphony being embedded in
Not everyone is convinced of Symphonys potency. Many
Bloomberg users say the new messaging service is superfluous.
I dont want a screen and computing power taken away
for something that I can already get on Bloomberg, says
Art Ayzerov, senior portfolio manager at Alpine Global
Management, a global event trading firm in New York. The
problem with Symphony is that its mainly a form of
communications with added flair, he says.
Symphony, like Money.net, faces the problem of running up
against Bloombergs network effect. For financial market
participants, the person at the end of every message is
on a Bloomberg, Taylor says. Until enough people
are using Symphony to be a tipping point, everyone says
everybody else is on Bloomberg, so I have to be on it also.
Until you get that critical mass, its hard to get people
on your system. Symphony says it has 200,000 users.
Symphony has an advantage in that its owners
financial institutions are captive users, but Taylor
says its not clear how much traction Symphony is getting
even at those institutions. And the fact that they are
competitors in so many different businesses could be a
hindrance at some point to their Symphony venture.
You have the odd situation of a consortium of rival
institutions creating something not because the market needed a
new service, but because they thought they were paying too much
to one vendor, Taylor says. Im not sure
its a sustainable business.
Beside Money.net and Symphony, Bloombergs
competitors include Thomson Reuters, S&P Global
Market Intelligence, and FactSet.
But Bloomberg isnt taking challenges lying down.
Bloomberg may face more pressure now than they ever
have in the past but I have watched them fend off
threats for years, Taylor says. Their attitude is
always to work on improving their product and not to spend time
addressing specific competitors.
In fact, he has never heard Bloomberg employees mention a
specific competitor. They dont look right and left
a lot. If a customer says theres an unmet need,
theyll try to meet it, he says.
Like others, Taylor cites Bloombergs customer-centric
culture. They have such deep roots within the companies
they serve that they have developed real loyalty.
Credit investor Falbaum is one customer whose loyalty
Bloomberg has earned. I get calls about once a month from
our Bloomberg sales rep asking if Ive seen their new
functions, and about half the time its something
useful, he says.
Falbaums salesperson also asks him if hes having
any problems using his terminal. He lets the rep know when
there is something hed like to do on his Bloomberg but
cant. Sometimes his suggestion is heeded. Falbaum is also
impressed with Bloombergs forays into trading and
clearing stocks and bonds.
When Bloomberg moves into a new area, they do it
carefully and successfully, such as collateral and risk
management services, says Hugh Stewart, New
Yorkbased research director at London firm Chartis
Research, which focuses on risk management technology.
He and others cite Bloombergs 2016 purchase of
Barclays bond indexes benchmarks widely used by
fixed-income professionals as a smart move. Those
indexes provide Bloomberg great opportunities for licensing
income, they say.
Its an important, sustainable advantage, because
investors have to use the indexes as their benchmarks,
Taylor says. And Bloomberg showed flexibility in its
willingness to buy an established product rather than building
its own bond indexes. Its a clear example of where
they continue to deliver value for the terminal to fend off
risk, Taylor says.
Bloomberg is also leading the pack in developing data feeds
for securities. Data feeds represent the fastest-expanding part
of the financial information market, with 7.8 percent
annualized growth over the past five years, according to
Burton-Taylor. Bloombergs growth in this area was
14.7 percent annualized over the past five years, lifting
its annual revenue for the segment to $1.1 billion last
Bloomberg wasnt even in the data feed business 15
years ago, but now it has a captive audience due to regulatory
requirements, Taylor says.
Thanks primarily to the growth in data feed revenue,
Bloombergs financial-market revenue increased 3.4 percent
in 2016, to $9.2 billion, despite the drop in terminal
subscriptions, according to Burton-Taylor. Terminals account
for $7.2 billion, or 74 percent of total revenue.
Some customers see their Bloomberg terminals as an
equalizer. William Slaughter, a partner and senior portfolio
manager at Northwest Passage Capital Advisors in Milwaukee,
says Bloomberg puts his small, emerging-markets
money-management firm (a bit less than $1 billion in assets) on
a level playing field with much bigger ones. PIMCO and
BlackRock dont have better functions for technology than
we do, because they are using the same platform, he
Bloomberg could ultimately replace almost all front- and
back-end office systems for money managers, Slaughter says.
Theyre becoming an end-to-end solution, whether
youre running $1 trillion, $1 billion, or less.
For many users, the one-stop shopping represents
Bloombergs biggest appeal. I use it as a quote
machine, a research tool for options pricing and metrics, and
for updating my portfolio through Excel spreadsheets,
says money manager Shalov.
Its no wonder, then, that users are reluctant to
abandon Bloomberg, despite its hefty price tag. People
are buying it because they have money at risk, Taylor
says. There is risk to companies and asset managers
personally. That makes them resistant to change.
Put bluntly, Bloomberg is a bigger threat to others than
others are to Bloomberg, Chartis Stewart says. The
amount of work Bloomberg is doing to add value multiplies their
moats, he says. People can chip away at the
edges, but thats mainly through lower prices, which
isnt very profitable, he says. They dont
break the increasingly large golden egg.
Eventually, of course, someone will dethrone Bloomberg: No
one stays at the top forever in any endeavor. Yet its not
clear where that blow will come from. Some mention Silicon
You could argue that Google and Microsoft are a bigger
threat than Symphony, Money.net, or other current
competitors, Taylor says. But they would have to
prove their chops. The challenge for Google or Microsoft is
that they have a huge learning curve before they are in a
position to compete at a financial institution that has $1
billion at risk. Given the size of the market for
financial technology, its only a matter of time before
such Silicon Valley royalty make forays into Bloombergs
Yet if history is any guide, they are more likely to be
roadkill than killers themselves.