The Bloomberg snooping "scandal" ...and Schadenfreude
I’m quoted in the South China Morning Post today on the Bloomberg snooping brouhaha.
My opinion, as I gave it to the writer was: “Bloomberg’s excellent access to and use of data is not a secret. And the use of aggregated usage data is simply smart business and smart journalism. Where this case seems to have crossed a line is in providing reporters access at the individual and company level. That should be confidential. In other words, knowing that users in Asia are reading a particular story is important and useful information. Knowing that I myself am logged in and reading a story is my own business and no one else’s.
“Bloomberg’s particular bad luck is that this story has become big at a time when people the world over are much more aware of and sensitive to privacy concerns.”
I think there are two parts to this story.
One is what everyone has been focussing on: the fact that Bloomberg in addition to looking at aggregated usage data like any modern, business-oriented media company should, seems to have crossed the line into looking at companies and individuals. In addition to the privacy concerns, there’s the very real issue that trading strategies could be compromised if ever the usage data got too granular (has Company A stopped reading about China and started reading about Turkey? Does it seem like Company B is interested in fixed income instead of equities these days?).
But the other is about companies that get too big and too arrogant... and about how when they stumble there’s an unmistakable Schadenfreude. There’s a lot of piling on at the moment. Competitors feel glee (and relief); clients sense an opportunity to renegotiate; fellow journalists jump at the chance to take the powerful down a peg.
My guess is that this will be an important milestone in Bloomberg’s maturation as a company. The necessary lines between commerce and journalism will be reaffirmed (but let’s remember how brave Bloomberg was already in publishing its bravura China series at the risk of considerable financial harm). Ethical boundaries will be rethought and retaught, hopefully throughout the industry.
And Bloomberg’s news and terminal business will in the end continue to be judged on the one question that Wall Street really cares about: “Does it help us make money?”
(Disclosure: I was at Reuters and then Thomson Reuters for 25 years… for much of that time competing head-to-head with Bloomberg. I had and have huge respect for what Bloomberg created in an incredibly short period of time).
David Schlesinger is the former Editor-in-chief of Reuters News and Chairman of Thomson Reuters China, and founder of Tripod Advisors.