Bloomberg is likely to enter the evaluations business this year, and when it does make a proper attempt on the market, will probably have “reasonable” success.
This is the view of TowerGroup analyst Matt Nelson, who presented the findings of the analyst’s recent report on the providers of evaluated pricing at the recent Technology Solutions for Asset Managers event in London.
Nelson described Bloomberg as the “best kept secret” of the evaluations business. As first reported in Reference Data Review in April 2006, Bloomberg has been quietly building an evaluations service for some time, and had hired John Lynch, ex of EJV, to spearhead the effort – although he left shortly afterwards, reportedly over a disagreement about the revenue targets Bloomberg had set for the activity (Reference Data Review, September 2006). Other evaluations veterans are rumoured to have joined and left Bloomberg since that time, but, though the vendor itself remains characteristically tight-lipped about the timing of its launch, it continues to hire evaluations staff – recently advertising for people with experience in valuing mortgage and asset-backed instruments in New Jersey and New York.
According to Nelson, Bloomberg will be joining a business that is “fully matured”, despite the fact that evaluated prices are still less well accepted in Europe and Asia than they are in North America. Commenting on the incumbent providers, Nelson said the TowerGroup survey found that Interactive Data – still by far the dominant provider of evaluated prices – has strong global coverage and good support. He continued that the TowerGroup research suggests Reuters’ focus on the technology and support behind its evaluated pricing businesses leaves something to be desired, though he added that its efforts in Asia should pay off in the long term – as should Standard & Poor’s focus on Europe in the near-term.
Going forward, the market should expect to see more partnerships between evaluations providers, and potentially some acquisitions, Nelson said, leaving delegates with the rather obvious advice that they should “choose vendors with strengths in (their) particular area.