Stock News Booms, and a Business Blooms
Michael Bloomberg's media empire has bigger rivals scrambling to adapt; now a TV presence in New York
Billionaire Michael Bloomberg tells a story about how his sales organization was growing so fast that the New York office ran out of space. One Friday night after the staff left, he brought in a carpenter to cut 18 inches off each desk. New desks of the same reduced size were added to the reclaimed space.
When employees returned Monday, it was hours before most figured out why everyone had a seat.
"If you really want to do it, there's a way," muses Mr. Bloomberg.
Michael Bloomberg is a man who really wants to do it, and he finds the way.
New business channels
Most recently, the media mogul found a way to enter the New York TV market just months after losing a bruising battle with one of the country's cable-TV giants, intent on keeping him out.
And he found a way to take on Dow Jones & Co., America's leading provider of financial information, in its own backyard.
A virtual nobody 10 years ago, Bloomberg has become well known to virtually anyone who uses financial information.
His computer terminals, 75,000 of them, deliver up-to-the-minute, highly sophisticated market news to investment professionals in 100 countries.
His news service funnels streams of stories and programs to newspapers and radio stations around the world.
And on June 11, he announced a deal to provide news and lifestyle reports to New York TV station WBIS+, owned until recently by Dow Jones.
Dow and co-owner ITT sold the station last month to Paxson Communications for $257.5 million. Paxson then hired Bloomberg to provide as much as 12 hours daily of programming.
It gives Lowell Paxson, founder of the Home Shopping Network, a program anchor for WBIS+, to be renamed WPXN.
And it provides Bloomberg with a TV outlet in New York, after losing last fall's battle with cable giant Time Warner for distribution on one of the city's public access channels.
Bloomberg's determination to find a way is chronicled in his new autobiography, modestly titled "Bloomberg by Bloomberg" (John Wiley & Sons, New York), and the author stopped by the Monitor last week.
The Bloomberg empire got launched when Bloomberg, the man, got fired.
After graduating from the Harvard Business School, Bloomberg joined Salomon Brothers, the prestigious New York investment bank. When Dutch financial giant Philbro bought "Solly" in 1981, he was fired.
But that same day, he learned that as a Salomon partner, his share of the sale was $10 million.
Too young to retire, he put his knowledge as a Wall Street insider to work. He knew what sort of information bond traders needed; he knew they weren't getting it; and he knew they would pay a bundle to have it delivered to their desktops.
That knowledge launched Bloomberg LP and a major success story.
Securities firms pay $1,140 a month for a Bloomberg terminal, which makes the service at least an $80 million-a-year business.
The terminals provide information, from stock and bond quotes to the latest financial news, reported by Bloomberg's own staff of reporters in financial centers around the world.
In his interview, Bloomberg says his business (he owns 80 percent) has been growing 30 percent a year. The terminals provide a cash cow for his push into radio, TV, and magazines.
Dow Jones, which owns rival Telerate, "clearly has a problem," says Bloomberg, with typical brashness. "We don't pay a lot of attention to them." Telerate, he says, is "playing catch-up."
While technology changed, he charges, Dow Jones "did nothing with the product for 10 years." He's doubts Telerate can keep up.
Bloomberg considers Reuters his main competitor, with four times as many terminals around the world.
If he stopped expanding his radio and TV ventures into new locations and languages, that part of his company would become profitable "in a matter of months," he says.
Though most of his growing media empire is electronic, Bloomberg has high regard for print journalism.
He writes: "After trillions spent on television news production and delivery, serious consumers still get their basic in-depth news from a medium that existed in Shakespeare's day, the newspaper, and their real-time news from the 95-year-old radio."
"Newspapers," he adds, "are sirloin steaks; radio and TV news are Big Macs."
He regards his own electronic empire with its "serious news" as a niche business compared with mainstream news, with its emphasis on crime. "Everyone thinks there is this enormous market for business news," he says. But there isn't.
Bloomberg's corporate headquarters in New York has no reserved parking spaces for its executives. If a company has such set-aside spaces, "you are telling everybody that works for you they are less important than you are," says Bloomberg.
Moreover, he says, most of the time the spaces are empty. That signals employees the brass are off playing golf.
"If you want the best space, then come in early," he advises executives.