Bloomberg goes softly on upgrade plan
Bloomberg is known for its brilliant information technology, solid journalism and corporate arrogance. The last factor has taken a lashing after attempts to force a price rise on customers were sheepishly laid aside.
Bloomberg terminals are well established in the offices of financial services groups and customers have long known the provider was not easy to negotiate with on issues of price and services.
The South China Morning Post is not currently a customer; Bloomberg collected its terminal after an editorial dispute in 1999.
Unlike data, information and analytics providers such as Reuters, Bloomberg does not sell small slices of its services. Basically you buy the whole kit or go to someone else.
It was an attitude the group could afford to take as its market share and reputation grew in the roaring 90s.
But so far the new millennium has not been too kind to anyone in financial services. Certainly not for a typical Bloomberg customer, whether he be a broker, fund manager or news outlet.
That is why customers in Hong Kong, at least the smaller ones, were not overly impressed when Bloomberg announced last year that they would all be undergoing a 'technology upgrade' that translated into a price rise of up to 42 per cent.
'It's a bit cheeky - we're upgrading and by the way your paying for it,' Overlook Investments fund manager David Devine said.
Smaller customers like Overlook are more affected by the proposed upgrade to a data transmission line that would carry much greater capacity. It is a one-off cost, whether you lease one terminal or 20.
So for users like Harry O'Neill, a managing director at executive search firm Whitney O'Neill, the upgrade meant about a 40 per cent increase from the US$1,400 a month he pays.
After protesting, Mr O'Neill was told that he was put at the 'end of the queue' for upgrades. 'It's a tremendous news service and great communications tool . . . but we would have cancelled.'
Nor did customers always agree that they needed enhanced transmission capacity.
Louis Wong Wai-kit at Phillip Securities, for instance, was told the upgrade would make it easier to view Bloomberg TV.
'We don't watch the TV,' he said.
He is still considering the upgrade, but says he was told it will not be mandatory, a sign Bloomberg is backing off.
Nothing on the subject could be confirmed from Bloomberg. We started placing calls to the Hong Kong honchos before Christmas, but were told to wait for an 'official reply from the New York office'.
Most users we spoke to think the plan is being shelved for now, to re-emerge in better times.
Raising prices to a client base suffering in a severe industry downturn, is, at one level, a determination to be admired. It is also gallingly thick-headed.
Of course, these directives would have come from New York so our apologies to the local keeper of the account at South China Securities. They may be feeling a little harassed over there.
This reporter placed several calls to the relevant contact, but could never make it clear she was not a Bloomberg salesman.
Each call ended with the same exasperated cry: 'We will not upgrade!'