Reuters, Bloomberg, and the Future of Journalism

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The battle between two media conglomerates may change the way news is gathered and distributed

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An announcement the other day from Steve Adler, editor-in-chief of Reuters, reported with considerable and appropriate pride the hiring of Alix M. Freedman as global editor for ethics and standards. Freedman came from the Wall Street Journal, where she spent twenty-seven years and was most recently deputy managing editor and Page One editor, traditionally a position of enormous prestige in the newsroom. Among numerous other awards, Freedman won a Pulitzer Prize in 1996 for her superb investigative series on the tobacco industry. In her new job, Adler wrote, Freedman will work "closely with reporters and editors on major stories, final-reading many signature pieces and holding us all to the high standards set out in Thomson Reuters Trust Principles and the Reuters Handbook of Journalism."

Dean Starkman, of CJR.org's audit blog, and who is a former Journal reporter, offered this appraisal of the move: "Anyone who thinks that the departure of Freedman . . . is inside baseball for media types is dead wrong. It is a devastating blow to that institution." Freedman, he wrote, was more than a single journalist of stature. At the Wall Street Journal, she represents "an entire journalism culture" that came into play when Rupert Murdoch's News International bought Dow Jones. Murdoch's empire is still reeling from the hacking scandal that led to the departure of Les Hinton, Dow Jones's CEO.

Whatever motivated Freedman's decision to leave her job, the appointment is certainly another signal that Thomson Reuters is in a major contest for dominance with its principal rival, Bloomberg, a comparably ambitious provider of financial data and news. A series of appointments lately has added a roster of stellar names to the Thomson Reuters enterprises. Among the high-profile arrivals are Chrystia Freeland, who was managing editor of the United States edition of the Financial Times; David Rohde and David Cay Johnston, two Pulitzer winners who had highly visible runs at the New York Times; Jim Ledbetter, who was editor of Slate's short-lived financial spin-off; and just recently, Jack Shafer, who was Slate's respected media critic. In addition, Reuter's Felix Salmon has become a notable figure in the crowded field of financial bloggers.

The Reuters opinion team includes contributors of the standing of Larry Summers, formerly a top adviser to President Obama and a treasury secretary in the Clinton administration, and Mohamad A. el Erian, chief executive officer of Pimco, one of the most visible and influential executives in the financial stratosphere.

Bloomberg has amassed a similarly impressive roster as it launches its opinion section, Bloomberg View, and is investing in Bloomberg Businessweek and its multiple news teams in Washington and around the world. (Ironically, Adler was the last editor of Businessweek as it was unloaded by McGraw Hill because it was struggling financially.)

The growth of Thomson Reuters since their merger in 2008 and the rise of Bloomberg (about which I wrote about in May 2010) are major developments in journalism that aren't fully recognized by the public at large because so much of their activity and income comes from financial data on terminals and in specialized packages. Unlike the leading newspapers in this arena that also have formidable ranks of reporters, commentators and editors--the New York Times, Financial Times, and Wall Street Journal--the lack of a daily anchor in print seems to reduce the visibility of their output in the traditional competition for attention in mainstream news circles.

Because Bloomberg is privately owned, it is hard to know just how profitable it is, but every indication is that it has come through the prolonged financial crisis since 2008 without any meaningful loss of momentum. Thomson Reuters is a more complicated situation. According to a recent takeout in the Wall Street Journal, the Thomson family and its investment arm, Woodbridge, which controls the majority of shares in the enterprise, is "impatient with the company's performance." Like Bloomberg, Thomson Reuter's revenue is significantly tied to its sales of sophisticated and extensive material, to Wall Street, and to the international banking community through its markets division. Over the summer, Thomson Reuters restructured the markets division, leading to the departure of six top executives. The division now reports to Tom Glocer, CEO of Thomson Reuters, who led Reuters into the deal with Thomson. The stock price of Thomson Reuters has been lagging, and posted a fifty-two-week low recently, a drop of almost 20 percent this year.

But assuming the shake-up on the financial side and the strengthening of its already formidable news operation gain the necessary traction, its competition with Bloomberg will be a vitally important aspect of how journalism is adapting to the continuing turbulence in the industry. The Washington Post Company's stock is down by about a third this year, largely because of pressure on its Kaplan educational division in the aftermath of disclosures about the practices of for-profit educational companies. The Los Angeles Times has just let laid off another group of staffers, including several highly respected reporters. While the New York Times has come through the crisis it seemed to be facing two years ago, most legacy print news organizations are still casting about for the right combination of digital and traditional advertising and circulation revenues.

With so much uncertainty elsewhere in the news business, the robust competition between Thomson Reuters and Bloomberg looms especially large in the overall future of news gathering. With thousands of reporters and strong leadership teams, both companies are bound to be factors in the news business in the digital age, even if their overwhelming profitability is tied to financial data. The Wall Street Journal's loss of Alix Freedman is, as Dean Starkman observed, much more than a job shift. It is a measure of bigger changes in how news and data are being collected, paid for, and distributed.

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Peter Osnos is a contributing writer for The Atlantic. He is the founder and editor at large of PublicAffairs books and a media fellow at the Century Foundation.

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