Burton-Taylor Data Indicates Challenging Year for Thomson Reuters, Bloomberg and Financial Information/Analysis Market

B-T quantifies financial information and analysis spend at US$23 billion in 2008; Asia and Europe showed growth while the US contracted.  Thomson Reuters and Bloomberg hold 58% market share, but FactSet, Interactive Data Corp and SIX Telekurs show strongest growth

Burton-Taylor International Consulting LLC, a leading financial news and market data research, strategy and business consulting organization, today released research showing the market shares of industry leaders Thomson Reuters (TRI) and Bloomberg to have increased slightly in 2008 to 34% and 24% respectivelyThe overall spend on financial information and analysis globally was flat year-on-year, as the industry exited 2008 at US$23.01 billion versus US$22.99 billion in 2007.

Although distant in terms of revenue, the fastest growing major data providers in the industry were FactSet Research Systems, Interactive Data Corporation (IDC) and SIX Telekurs which now enjoy 2.5%, 3.3% and 1.2% global share respectively.  The fact that the third, fourth and fifth biggest players hold less than 4% market share each only serves to underscore the duopolistic nature of the current market data industry.

Asia led all regions in 2008 with a 20.3% increase in spend, while Europe, Middle East and Africa (EMEA) grew at just under 7% and the Americas contracted by almost 10%.  Thomson Reuters is the market share leader, with Bloomberg second, in each of the three regions.  Quick sits third in Asia while SIX Telekurs is third in EMEA and IDC third in the Americas.

Burton-Taylor data shows that exiting 2008 the largest segment, in terms of total information and analysis spend worldwide, is Fixed Income/FX Sales & Trading. Investment Management is second largest, followed by Equity Sales & Trading, Corporate, Wealth Management, Commodities & Energy and a dramatically smaller Investment Banking segment.

A challenging year in 2009 is projected by Burton-Taylor, with negative 1-3% growth seen for the industry.  The Americas will continue to contract.  EMEA will remain flat but be supported by growth in the Middle East and Eastern Europe. Asia’s growth rate will be significantly less than recent years but still reach the low to mid-single digits, fueled by external investment from Japan and internal investment in China.

“Thomson Reuters and Bloomberg will face differing challenges and changing business focuses in 2009,” says Douglas B Taylor, Managing Partner of Burton-Taylor.  “At TRI, feeding the appetites of the growing ‘low latency’ and risk management monsters, as well as continuing to establish a foothold against strong competitor Dow Jones in the machine readable news market, are key priorities.  At the same time, launching a new financial video service and rebuilding equity news to leverage their desktop dominance in the North American Wealth Management space will test the company’s ability to both invest and seek overall margin improvement.”

“At Bloomberg the attention is directed at finding new revenue outside the core terminal business,” Taylor says. “Commitments to high margin datafeed sales, and to improved news coverage in China, are seen as significant opportunities, but successfully capitalizing on the strategies without cannibalizing existing revenue will require creative commercial models and deft execution in areas that are relatively new to the company.”

According to Taylor, “Both TRI and Bloomberg are facing these challenges at a time when the revenue insulation provided by their dwindling two and three year client contracts is rapidly eroding.  Additionally, IDC’s continued aggressive approach to pricing and SIX Telekurs’ continued strong organic and acquisition-based growth may begin to dent the market shares of the ‘Big Two’.  Maintaining revenue by Thomson Reuters and Bloomberg over the next 12-24 months will be strictly on the merit of their strategic planning and execution.  Both companies are leaning heavily upon their proprietary news capabilities to help drive growth, which is one reason that Burton-Taylor in the coming weeks intend to publish the first ever, detailed comparative study of Bloomberg News versus Reuters News.”

“Because market participants are finding it increasingly difficult to differentiate services, we believe that our study ‘Bloomberg vs Reuters News – Analysis of International Services 2009’; a quantitative and qualitative analysis of Bloomberg News and Reuters News including regional and international content, daily and hourly volume, 3rd party redistribution, coverage breadth, coverage depth and commentary comparison, will provide a transparency and illumination that improves competition between industry participants and profitability of industry clients,” say Taylor.

Burton Taylor’s 2009 global financial information/analysis competitor market share map may be downloaded free of charge by visiting the Research Request page and inputting research sample code FINMARKETSHARE2009.

When requesting a free download, market followers may also wish to inquire about Burton-Taylor’s upcoming report “Bloomberg vs Reuters News – Analysis of International Services 2009”, a first ever detailed quantitative and qualitative analysis of Bloomberg News and Reuters News. To be notified when the comparison is published, simply enter code BBVRTRS2009.

About Burton-Taylor International Consulting LLC

Burton-Taylor International Consulting LLC is a financial news, market data and business consulting organization focused on helping companies improve performance through improved Market Intelligence (Sector or Customer Research), Strategic Planning (BU/Company or Service/Product Strategy) and Revenue Generation (Marketing or Sales Plans). Burton-Taylor’s trademarked Hourglass AnalysisTM provides a structured, yet customizable process to help companies clearly target new opportunities, define new strategy, and plan new actions to maximize growth. While accomplished in the Americas, Europe and Asia, and with a strategic approach that remains generalist, Burton-Taylor have developed substantial expertise in the global information, software and financial services industries, with deep focus in North America, China, India and Asia.

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