They've got over 300 000 subscribers each paying circa 2000 USD every month. That's 600 million dollars of revenue per month. They're running a labyrinthine functionality on a 1970s System/360-style interface (command line at top of screen). He hires an absolute army of "reps" who's sole job is to try to help subscribers to find functionality, through an interface that is best described as "arcane" and where there is no semblance whatsoever of a user-discoverable taxonomy of functionality. It's all just sort of "you gotta know where you want to go". Most people use 5% of the terminal's functionality (mainly messaging) but Bloomberg refuses to tier pricing. It's all or nothing. And with finance changing rapidly, the clients are axed to cut costs. Not to mention real suspicions of monopoly because bberg is increasingly competing with its own clients in order to maintain share.
This tyrannosaurus will be hard to take down frontally, but the beast is big enough and unwieldy enough that small nibbles here and there in specialized areas can be very attractive businesses.
Other tidbits:
* Bloomberg is stubbornly Windows only. No web, no Linux, no OSX no anything else except a bit of crippleware on mobile.
* Multiple Fortune 500 companies and banks would salivate at taking him on, which means a ready pool of very cash-rich potential buyers for your growing business if you get any traction, and that includes Bloomberg itself.
* Michael Bloomberg the man has not endeared himself to the current president so may be vulnerable.
Challenges:
* quant-style people who know what they're doing are very expensive. 200k USD plus per year.
* network-effects powerful in favour of bloomberg.
* once you're through the crusty user interface, assuming you found what you want (often with the help of a bloomberg "rep"), the actual functionality is often amazingly good.
I also can't emphasize how ossified and inefficient the Bloomberg corporation itself is. I've spent months BEGGING them to take my company's money (we had 3 terminal subscriptions and wanted to increase to 4) with them stalling us because they wanted to upsell us on a direct T1 line (! for like 100MB/day of data, yeah right). The entire company and product is a mess. Unfortunately, last time I tried it, Reuters's competitor terminal app was pretty awful too.
Reuters had the glorious idea to be modern and develop the front-end in JS. For an application where consistent high-speed delivery of information is the most important factor, that's just a terrible choice. For many companies, terminals are one of the most critical pieces of infrastructure. They shouldn't have to run in a browser engine.
> Bloomberg is stubbornly Windows only. No web, no Linux, no OSX no anything else except a bit of crippleware on mobile.
Although it is against license, you technically can remote desktop to Bloomberg terminal from Linux machine.
Bloomerg monopoly is more result of data they have rather than the clunky terminal. You can buy just Bloomerg data and use any type of analytics tool you find suitable (e.g. Pandas, matlab). Data is often crippled compared to terminal, but combining multiple tricks (e.g. different Bloomberg data subscriptions) you can get very close to 100%. I used to have access to terminal and data in structured format and I spent 95% time looking at data in Pandas and other data analysis tools rather than terminal.
I'm a former Bloomberg Terminal subscriber ($3k per month) and day trader. I may have used 1% of the Bloomberg's capability in my best day - money.net would have been a great alternative.
The problem is that most of the alternatives are made solely for equities. There are other asset classes out there that are at least as big (or bigger) where there is virtually no competition.
hey I hadn't seen that. I will check them out. However personally am sceptical of the "full frontal" approach (ie multi asset class etc) because you'll just never be as good as bloomberg, or even a fraction as good, on functionality, if you spread yourself that thin. I prefer a beachhead approach.
[EDIT] appears very buggy on Linux via JRE on my big 4k monitor
So, being completely ignorant of where/what data sources bloomberg is getting, can someone ELI5 the data-pipeline/sources?
Is this related at all to how some were accused of paying the [SEC?] to get trade info nanoseconds before others and able to front-trade? (or whatever thats called)
Is the SEC the canonical source for trade information that every HF wants to trade on?
I disagree, there are competitors for almost all the non-internally created datasets which implies the streams are available outside the Terminal.
IMO the network effect is the biggest thing to break and that would need to begin with the buy-side. If Pension Manager XYZ with $N trillion AUM uses Bloomberg then you can be damn sure so does anyone wanting to do business with them.
There are many temporally-exclusive agreements on all sorts of data, some government-supplied (!). "Temporally-exclusive" means that anyone can use the data, but one company gets it 5-600 seconds early.
Those are usually rather owned by ThomsonReuters. They make huge amounts of money with exclusive data feeds for algo traders. For the terminal it doesn't matter if you see the data a few milliseconds later, too late to trade anyway.
Already happening. The main selling points of BBG is the chat (IB), since it's the industry standard. That's why banks & asset managers started their own product.
There is a very strong desire to get a working competitor to Bloomberg to reduce costs. And replacements slowly seem to reach a maturity that make this possible.
But this is not work for a start up. You need a lot of capital to develop a product that works for all asset classes, and a huge network to enter the messaging sector.
barriers to entrance on data subs are complex supplier and per end user exchange licensing, and more so millisecond latency (to the extent that you compete on physical proximity to exchanges and low level tightly coupled native code)
They've got over 300 000 subscribers each paying circa 2000 USD every month. That's 600 million dollars of revenue per month. They're running a labyrinthine functionality on a 1970s System/360-style interface (command line at top of screen). He hires an absolute army of "reps" who's sole job is to try to help subscribers to find functionality, through an interface that is best described as "arcane" and where there is no semblance whatsoever of a user-discoverable taxonomy of functionality. It's all just sort of "you gotta know where you want to go". Most people use 5% of the terminal's functionality (mainly messaging) but Bloomberg refuses to tier pricing. It's all or nothing. And with finance changing rapidly, the clients are axed to cut costs. Not to mention real suspicions of monopoly because bberg is increasingly competing with its own clients in order to maintain share.
This tyrannosaurus will be hard to take down frontally, but the beast is big enough and unwieldy enough that small nibbles here and there in specialized areas can be very attractive businesses.
Other tidbits:
* Bloomberg is stubbornly Windows only. No web, no Linux, no OSX no anything else except a bit of crippleware on mobile.
* Multiple Fortune 500 companies and banks would salivate at taking him on, which means a ready pool of very cash-rich potential buyers for your growing business if you get any traction, and that includes Bloomberg itself.
* Michael Bloomberg the man has not endeared himself to the current president so may be vulnerable.
Challenges:
* quant-style people who know what they're doing are very expensive. 200k USD plus per year.
* network-effects powerful in favour of bloomberg.
* once you're through the crusty user interface, assuming you found what you want (often with the help of a bloomberg "rep"), the actual functionality is often amazingly good.