A Peek into the Plans at Bloomberg Media
It's been about an hour since Bloomberg employees were introduced to Andrew Lack, the former NBC News chief and Bloomberg's newly appointed CEO of multimedia. Lack and Chief Content Officer Norman Pearlstine and Bloomberg News Editor-in-Chief Matthew Winkler are chummy and spirited during an interview at Bloomberg's imposing headquarters. But in keeping with the company's reputation for near-martial discipline, they do not reveal Bloomberg's master plan for expanding its media operations in fulsome detail; much of the plan, Pearlstine says, remains a work in progress. Still, multiple interviews nonetheless provided several crucial clues to what looms at one of the last news organizations with swelling ambition.
You can feel a little like a weatherman in Greenland if you track media today: Both jobs entail watching big icebergs melt, and quickly. Bloomberg stays sturdy because, at heart, it's not really a media business in any familiar sense. It gets the overwhelming majority of its revenues from its Bloomberg terminals, which subscribers now rent for $1,500 a month and up. A quick analysis of internal company data suggests that last year, Bloomberg's media segment accounted for significantly less than 10% of the company's estimated $5.4 billion in overall revenue. (Executives at the privately held company declined to comment on the media unit's revenues and profitability.)
But Bloomberg's media operations employ a lot of bodies, and they're spread far and wide. Bloomberg has 220 staffers in Japan. Its wire services employ 1,500 people worldwide, with an additional 800 working in the TV operations. The default setting for media companies today is "retreat" as revenues fall fast, but that's not Bloomberg's reality. Thus, its executives think big. "We see the potential for significant growth from where we are today—we're talking a several-times increase in revenues over the course of the next four to five years," says Bloomberg President Dan Doctoroff. "We have the pieces...to create something new and different."
Still, Bloomberg's initial moves are likely to shore up what's already in place. Lack was hired in no small part to revamp Bloomberg's TV operation, which, Doctoroff says, has "not been what it should be." Bloomberg's cable channel is sometimes forgotten in the new CNBC/Fox Business Network dichotomy, but it currently reaches about 58 million U.S. homes. Doctoroff says that could swell to 70 million in '09. CNBC, for which I am an on-air contributor, is in more than 90 million U.S. homes. Fox Business Network reaches around 43 million. (CNBC has a much bigger lead over Bloomberg in reaching non-U.S. households.)
Next year also will bring major changes to the exceedingly prosaic Bloomberg.com, to make it more friendly to those who don't spend their days intravenously connected to a Bloomberg terminal. Doctoroff says such changes will be visible in the first half of the year. He also suggests that attenuated staffing at newspapers could mean opportunity, though it's hard for me to imagine Bloomberg churning out stories about local businesses in second-tier U.S. markets.
And, interestingly, "we're looking at potential acquisitions," says Pearlstine. "We're just sort of saying: 'Hey, we're looking for good ideas.' " This is a new notion for Bloomberg, which to date has exclusively generated its own media properties. Doctoroff refused to comment on specific acquisitions, and outside executives familiar with the deal markets find it hard to believe Bloomberg would go into anything big. (Before this rumor gets resurrected again, let's knock it down: Michael Bloomberg has disavowed interest in a bid for The New York Times, which another mayoral campaign would complicate in any event.)
In truth, there's a complex calculus to any possible Bloomberg deals. The company is likely to want any media add-on to feed its massive terminal business as well. No matter what media moves Bloomberg makes in the next few years, that business will remain king. But maybe the changes will make Bloomberg's media operations its jack, if not exactly its queen.