After a day or so of tweaking, software downloading and restoring files from my JungleDisk network backup drive, Ariel has come to life in full. The fourth of a series of Dell Latitude laptop PCs that I have used (we'll forget that Compaq that I had for a corporate job), Ariel is the third unit I've owned named after archangels, a small but welcome comfort when I have need of a machine that can deliver some assurance to a hard-working road warrior. The processing power of this ES6400 model and its solid-state RAM drive certainly help Ariel to deliver those assurances. Having been out of the PC purchasing loop for several years, now, though, I must say that Ariel is representative of a new place in the content hierarchy for PCs than former units that I have owned, more a waystation than a destination in the stream of real-time content going and coming from a myriad of inputs and outputs.

Labels: Bloomberg, Business Information, Business Intelligence, centrino, dell, dual processor, e6400, financial information, latitude, pc, real-time, thomson reuters, video

As the financial industry has writhed and wrinkled under the pressures of a wilting market for securities, financial content vendors have squirmed along with them, trying to define value propositions that will enable them to help both traditional clients and any and all possible new ones that they may be able to surface. One of the content companies positioned best to take advantage of these changes is Alacra, an up-and-coming aggregator of financial and business information that has spread beyond its roots in investment banking to appeal to a broader audience in finance and corporate circles. Alacra has a series of core premium research offerings with high functionality that major institutions can subscribe to as well as The Alacra Store that enables people to search for and purchase premium financial research and news sources on an a la carte basis. This allows Alacra to shift revenue streams rather nicely as clients become more or less oriented towards subscription services as the global economy goes through its cyclical paces.

One of the major problems in the current economic downturn, though, is that in many instances earlier sources of premium research are disappearing. As investment banks and other institutions have cut back on their research staffs, there are fewer people being paid to turn out premium research reports on institutions issuing securities and on market sectors. In some instances major institutions are passing on research coverage on major sectors such as the finance industry itself. Imagine that - banks refusing to analyze banks. Strange times, indeed, but that has become the economics of the securities industry. As more and more trading of securities has shifted to electronic trading systems, the shrinking profits from electronic trades have made it harder to justify the expense of offering clients detailed research and analysis.

This doesn't mean that quality research and opinion on financial markets has disappeared altogether, though. As in many forms of publishing much of the information that used to come from major banks and financial publishers through premium services can now be found in one form or another on the open Web. That's the good news, but the bad news is that it's not the easiest thing to filter out the good sources from the bad sources and to get it into a form that's meaningful for financially-oriented professionals. Barry Graubart, Vice President, Product Strategy & Business Development, calls this need to filter out lower-quality sources the "signal to noise ratio," a fair way to characterize the problem given the level of noisy and oftentimes inaccurate sources of financial information offered by some services on the Web.

Enter Alacra Pulse, a new "freemium" offering from Alacra that breaks new ground in organizing content freely available on the Web into a highly usable format for investors, an aggregation that focuses on content relating to several hundred large and medium companies from hundreds of sources on the Web. In some instances Alacra Pulse's sources are familiar names such as investment bank ABN Amro and Standard & Poor's Credit Research, sources that publish many market reports and alerts for free already. Other sources are much more niche-oriented and more likely to carry some of the Web's sometimes irreverent outlook on topics, but are carefully picked by Alacra for their quality and the demand for their quality by financial professionals.

For instance, Stockgeek.net might not be the first source that would come to an average person's mind as a reputable source of financial information and insight, but those in the know are aware of its opinions and rely on it and many other non-traditional sources of financial information to keep them informed. I have witnessed this myself many times in doing research for financial information companies. Many financial professionals take the time to look at key trusted online information sources that focus on their domain of expertise. These sources include many independent financial analysis firms, which use a level of free information on the Web to attract insitutions to premium services.

Alacra Pulse does a nice job of wrapping these sources up in a standardized format that makes it easy to get the best of independent thinking on investments available today. Alacra Pulse enables you to look at the latest on all topics from analysts, to drill down into research on specific companies or to browse through the research and insight offerings from specific sources. Links to articles and reports from sources are labeled with color-coded icons that identify the type of source - "sell side," "buy side," credit agencies and industry-specific experts - and are also complemented with links to premium sources in The Alacra Store for those who would like to pay a bit to dig further. Otherwise, you can click on a headline to view a story on its native Web site.

One of the key features of Alacra Pulse is the ability to leave comments on a featured story. In just the few days since its debut Alacra Pulse seems to be drawing quite a few comments already, helping to enrich the site for both its visitors and advertisers looking for a little extra "stickiness" for their ads. The presentation of the Alacra Pulse ad-based portal is similar to other Alacra products, offering a simple, clean look and generally easy-to-use features and ads that are not too intrusive. For those that need more tools, the premium version offers alerts filtering and email notifications as well.

Financial information for professional investors tends these days to fall into either the ultra-staid realm of subscription database services or the wild and wooly world of online services that speak frankly about investments. Alacra Pulse does an excellent job of aggregating the best of online services into a format that professionals - and those who pay for their financial information services - should feel comfortable using and supporting. In that sense Alacra Pulse is a good calling card for investment-oriented professionals who can learn about the Alacra brand from this new product and feel comfortable graduating from it into more premium offerings.

In the meantime hundreds of companies that have been losing valuable coverage from industry analysts at major investment banks can begin to reap the rewards of a service that begins to give their securities issues a chance of getting consistent high-quality free coverage aggregated in a convenient format for their investors. At a time when everyone in the investment community is struggling to come up with answers to getting investor confidence rolling again, Alacra Pulse is a well-timed offering with a great signal-to-noise ratio that may help the markets to get a pulse again.

Labels: alacra, alacra pulse, blogs, coverage, financial information, First Research, freemium, reports, securities

LinkedIn's growing success is both admired and feared by many in the content business, but the rap against them for quite some time has been, "Well, yeah, but where's the monetization?" In truth LinkedIn has been growing revenues steadily through traditional brand ads, partnerships and payments for premium services. But with two key moves LinkedIn is raising the bar on its prospects for revenues - and for a potential exit at a more appreciable price.

The fist LinkedIn initative is its new DirectAds service, which enables LinkedIn members with profiles to produce simple text ads on a self-service basis that can appear in other members' profile pages. Similar in overall concept to Facebook's SocialAds program - a link to the advertiser's profile appears in each ad to ensure that marketing is on a conversational basis with a known entitiy - DirectAds has the added benefit of being able to target executive peers in the LinkedIn network with a great deal of granularity - and charges healthy but affordable minimum rates to do so - a $25 minimum for a flight of ads, with impressions based on a variable formula. Filtering options include many of the criteria found in a typical member's profile, including the ability to limit ads to specific geographic regions.

The potential for DirectAds is very strong within LinkedIn itself, but it also has the potential to provide B2B publishers with some real concerns as this evolves. Though there is no announced plan to take DirectAds off-site into other publishing venues, certainly classifieds in B2B journals and Web sites could be easily targeted by LinkedIn with its extensive network of top-shelf executives and salespeople. More importantly, it's not too hard to imagine that a B2B publisher seeking revenues from companies trying to get a message through to very specific executives would jump at the chance to use DirectAds to get rates far higher than classifieds for its very targeted profiling capbilities. In very tightly knit B2B communities DirectAds would play very well in B2B publishing venues. Technologically, it would not be hard to implement at all - it would only take enabling a B2B publishing site with Google's OpenSocial API. With such a combination DirectAds would have a Google AdWords/AdSense revenue combo for on-site/off-site revenues that could be impressive indeed. If done properly - hopefully avoiding Facebook's pratfall with its Beacon program that released private data in a user-unfriendly manner - this has the potential to be to B2B publishing what Google was to consumer publishing, turning advertising into relationship building with one click of the mouse. With its potential for ultra-precise targeting, it could put somewhat of a dent in marketing lists services as well in time.

The other interesting new program at LinkedIn is the LinkedIn Research Network, which leverages some of the concepts that it employed in LinkedIn Answers to provide a tool that can enable executives to conduct peer-to-peer industry research. As in LinkedIn Answers members of LinkedIn can pose questions to peers in the LinkedIn network, using LinkedIn's extensive structured and unstructured member profile data to zero in on just the right people to target for questions. The Research Network provides its users with a workbench to monitor responses to questions and to in effect build research panel who can be contacted for additional questions.

The revenue hook in Linked in Research Network is its use of LinkedIn's private InMail network to contact members. Members may use InMail for contacting up to 20 people at a time, presumably to cut down on "spam" research requests and presumably to make it easier to meter the pricing to a reasonable block of minimum requests. Of course, one can sign up for InMail at any number of premium levels, so the real hook is to promote InMail premium subscription revenues as much as possible. Given that the demo video was intent on saying that this product was targeted primarily at financial industry analysts trying to contact experts in companies and market sectors, perhaps their initial expectations for its use are limited. But clearly its ability to combine the art of research into the art of marketing will make this a popular option for many over time.

With both of these options LinkedIn is taking a relatively low-key approach to product development, moving relatively slowly to ensure that their most valuable asset - the trust and security that the LinkedIn system of opt-in relationships has protected through its development - will not be tainted or abused. Executives are a conservative bunch when it comes to dealing with their personal reputations, but LinkedIn has proved to more than 20 million professionals so far that it is by and large a very trustworthy environment. With that trust as a primary asset, it's likely that LinkedIn has set the stage for some solid revenue development that is likely to upend a few B2B applecarts in the long run. For the time being, though LinkedIn is just at the begininning of what promises to be a long battle for the rights to what professionals value most in carrying out their business - trusted relationships that can yield revenues.

Labels: advertising, financial information, LinkedIn, Monetization, Research

The New York Stock Exchange has been careful through the years to keep feeds of trading data released to public media outlets hobbled with a fifteen-minute delay - in part to protect its revenues from financial institutions being charged for real-time data and in part to offer their member firms an information advantage that would help them have an upper hand with retail investors. But with most of NYSE's competitors being far more lax about releasing real-time trade reports and the definition of "real-time" having changed with powerful new low-latency trading systems for professional traders NYSE has re-evaluated its position on real-time trade reports for the public. Today NYSE Euronext launched its "Realtime Stock Prices" product for media, allowing unlimited distribution of real-time quotes to the public without tracking individual use. The product requires a distributor to pay an undisclosed bulk fee for the rights to public data distribution.

With NYSE's share of securities trading slipping and it's reputation as a market friendly to small investors slipping along with it real-time quotes from the public should have been a default position years ago, as we've argued oftentimes in ContentBlogger. Today's retail investors have more options than ever for making money in the markets, with NYSE's stumbling "blue chip" stocks being far from the most attractive alternatives for many. Forcing people to pay for real-time trade reports was only discouraging further participation in NYSE equities markets by retail investors - especially when other exchanges seeking market share were more than glad to use market data as a lure to new traders.

CNBC has long been a leader in public market data - I led the development and installation of their first delayed data system years ago for Quotron - so it's expected that they've opted to be on the edge of NYSE's release of this product. But the other announced client - Google - is one that was expected also but one that couldn't have come at a worse time for Yahoo. Real-time quotes from NYSE have been available from Yahoo at a premium for many years, so in a time when they have been trying to look plump to acquirers it's not surprising that they didn't opt to give up their NYSE quote revenues ("back door" real-time quotes from private electronic markets on Yahoo aren't strongly representative of the full market). So by default the go-ahead went to Google, whose Google Finance portal has become a very strong content offering. If nothing else the public knowledge that full NYSE real-time quotes are available at Google will provide some needed publicity for Google Finance at a time when Yahoo is slow to give up existing revenues.

I would hardly be alone in chastising NYSE for dragging their heels on releasing real-time quotes to the public, but it's sad that it has taken this long to get NYSE to make this move. It is, unfortunately, a familiar refrain in the content industry: major institution covets proprietary content revenues, squeezes them out for as long as possible while the markets move to find both acceptable substitutes and better ways of doing business. Publishing is in essence a very conservative business, so it's not surprising that NYSE would try to keep this formula going for so long. But in an era when the buyers of securities have and demand information at least as good as most selling institutions failing to serve the buy side in financial markets effectively is to ignore the fundamental shift in the content industry that empowers people with independent access to content from around the world. Your content may seem safe as a proprietary asset, but if it's not driving your clients' profits in its most valuable user-defined contexts it is far from a safe bet in today's content markets.

Labels: CNBC, financial information, Google, new york stock exchange, NYSE, stocks, Yahoo

A day that highlights world financial giant Citigroup's layoff of about ten percent of its workforce is a somewhat odd time to be running a profile of Thomson Reuters, but The New York Times has done just that. The article is entitled "The New Fight for Financial News," but of course the battle between Bloomberg and its perennial rivals now combined into a single company is fought on may levels well beyond the news front. Thomson Reuters CEO Tom Glocer likens Bloomberg in the article to the equivalent of Richard Branson's Virgin Atlantic airline shaking up the marketplace for transatlantic flights in the 1990s, an apt analogy on at least two levels. It's apt in the sense that Bloomberg forced its competition into many radical and painful changes to keep up with its growing market share - the new combined Thomson Reuters entity is just about toe-to-toe with Bloomberg for its piece of the financial information marketplace - but also apt in the sense that there's a new generation of competition that's putting both the financial information marketplace and the airlines on alert.

That new generation is not necessarily of the same type and heritage as either Thomson Reuters or Bloomberg. What impressed me most at the recent SIFMA conference and expo in New York was how the traditional financial information vendors are receding into the background as the technologists are coming to the fore. The exhibition floors were chockablock with networking technologies this year, both for low-latency automated trading services and for more general information and trade execution network services from vendors such as BT Radianz. Cloud computing was also on display at the SIFMA show from Salesforce.com, with a more aggressive and extensive display of its capabilities to support brokerage marketing operations. Also noteworthy was SDS Financial Technologies' moves to support more automated crossing networks for commodities and futures trading, helping to reduce execution costs and liquidity problems for a marketplace still tied to many face-to-face trading pits.

So while companies like Thomson Reuters and Bloomberg are going to continue to try to dominate on the desktops of investment bankers and portfolio managers for the foreseeable future, a lot of the action in financial information is taking place well away from the desktop and in the bowels of computer networks that support securities trading and sales. Not all of these stories are about the dominance of the Web as the cloud of choice - the financial marketplace has many specialized networks that support its sophisticated information-driven marketplaces - but certainly the concept of cloud computing popularized by the Web in which desktop technology is just an interface to sophisticated services from potentially any network providing information and execution services. Certainly the robust trading floor technologies developed in the past few decades will continue to be a part of this mix but with today's cutbacks by Citigroup serves as a reminder that we may be nearing the end of the era of big investment bank trading floors as the driver for measuring the success of financial information services.

With more and more workflows in securities trading having become fully automated in recent years it's not clear that the desktop-oriented services of companies like Thomson Reuters and Bloomberg are going to work out in the long run for high-growth information services. Instead, it's far more likely that more and more network-oriented "cloud computing" services are going to subsume more and more profitable parts of securities transaction support while information suppliers find an increasingly narrow range of clientele ready to spend handsomely on major desktop integration services. While the hedge fund trading of recent years hit speed bumps in recent months much as programmed trading caused hiccups in the 1987 crash, the ability of a small team of hedge fund managers to build dominant positions in a marketplace by mining information aggressively from alternative information sources not provided by traditional vendors should be a wakeup call to Thomson Reuters and Bloomberg that anyone can extract useful content from any cloud very quickly and effectively.

Major financial information vendors have had similar challenges in the past and have responded with valuable services to rebuild their position in the marketplace, but it's not clear to me that we're on another full-blown cycle towards that goal right now. I think that we're more likely to see cloud computing services gaining more and more power as they provide well-integrated information services to ever more concentrated and sophistated trading operations. I don't think that this means that Lehman Brothers will be moving back to its old South William Street HQ any time soon (now a cozy inn) but I think that we will be seeing the financial information industry looking more like it did in the 1950s than it did in the 1990s over the next ten years - with fewer and fewer direct product presences on trading floors and more and more integration into cloud computing services. There are opportunities there for Thomson Reuters and Bloomberg as well, of course, but perhaps not the types of opportunities that are driving their organizations today. In the meantime, congratulations to Tom for a great profile article.

Labels: Bloomberg, cloud computing, financial information, Salesforce.com, thomson reuters, tom glocer

In years past one could visit the head office of Bloomberg, L.P. and peer into the newsroom right off of the main lobby. Mike Bloomberg's office was right off of that news floor, with a glass partition that segregated him about as much as a head of an investment bank trading floor is separated from his or her operations. This was a natural for someone whose career took off in the trading rooms of Merrill Lynch driven by traders responding to real-time news events, but it also underscored the importance to Bloomberg of making authoritative market-moving news a key component of its success.

Times change, and now Bloomberg has announced the appointment of Time Inc. and Wall Street Journal veteran Norm Pearlstine as their first Chief Content Officer, a move that one presumes will enable Bloomberg to leverage its news and data assets more effectively in rapidly changing professional and consumer business news markets. Certainly this will help Bloomberg to move its revenue base more heavily away from professional markets, where its ubiquitous content displays are encountering fewer seats in an increasingly automated and specialized securities trading industry.

As I've noted for several years the financial information industry, like many enterprise content sectors, is moving away from a "bell curve" market model, in which lots of money is made off of many people equipped with subscription content delivery, to a "U"-shaped market model, in which lots of money is made off of highly automated content services and highly analytical services for a small cadre of decision-makers, with your typical "seat" revenues being realized more profitably through a media model where delivery has been commoditized as a benefit. Bloomberg has been relatively slow to respond to these changes, sticking to its highly profitable professional products but only recently beginning to up investment in its media brand audiences.

That's a challenging formula for growth given the continuing evolution of both Thomson Reuters and Dow Jones in supporting media markets more aggressively. Bloomberg 's online operations have grown audence significantly in the past year, almost doubling its online portal audience, but still trails Reuters and Dow Jones significantly for global markets. Thomson Reuters reported 18 percent quarter-on-quarter growth in its media sales in its first combined reports, an indication of how its global presence in online news markets has helped to fuel profits. So while Bloomberg's online, television and licensed content is strong, there is room for growth, especially in overseas markets.

But undoubtedly the increasingly sophisticated presence of Dow Jones has to loom large in Bloomberg's radar as much as the newly combined forces of Thomson Reuters. News Corp has managed this acquisition very wisely so far, retaining an online subscription base that both Thomson Reuters and Bloomberg lack while beefing up its Enterprise Media Group with its Generate acquisition. As these kinds of products that create professional value out of media sources begin to be adopted to Dow Jones' online media offerings Bloomberg will be challenged to devise both more powerful media offerings and a subscription community willing to pay for them. This will be at least as tricky as building a global content brand out of its existing news operations. The real challenge for Bloomberg is to respond to both new opportunities for media revenues and new challenges to high-end content analytics and real-time sales intelligence services in its core markets from newly strengthened players such as Dow Jones.

Pearlstine brings a deep and impressive legacy in the content industry to Bloomberg, but more importantly he brings an outlook on the media business which recognizes that the days of a handful of news monopolies dominating news gathering and dissemination are drawing to a close. To succeed with an electronic news brand one must not only excel at traditional journalism but as well one must excel in making news valuable in whatever context an audience finds it to be valuable. While it's not clear that Pearlstine's insider view of the media industry will lead Bloomberg to new successes in adapting to this more contextual view of the content marketplace he is likely to help open doors for Bloomberg to build out a more competitive brand for both online markets and for print markets seeking out new sources of editorial content.

Labels: B2b media, Bloomberg, financial information, media, News, Norm Pearlstine

Jeffrey Massa, CEO of Yellowbrix grabbed my ear at the Buying and Selling eContent conference in Scottsdale, AZ, for good reason it turned out. Yellowbrix is well known in both online and enterprise markets for its content aggregation, portal development tools and financial information services, but like everyone else in the aggregation game they've been looking at higher value tools to create better opportunities for insight through their content. The Sentiment Performance Indicator tool that Jeff showed me is one such tool - and a killer app at that.

The Sentiment Performance Indicator is a set of data and graphics tools built off of a Yellowbrix-developed semantic engine that munches through the content in its media feeds to determine whether stories on a particular company are positive, negative or neutral. This data then drives simple data displays and charts that enable one to get a grasp on likely market sentiment for a company's securities very quickly. This can be especially important before a securities market opens - there's that period before trading begins when analysts people on sales and trading desks in financial institutions try to get a fix on market sentiment is overall and for particular investments. Traditionally this is done with phone calls to trusted contacts, browsing through news, morning reports and other more quantitative tools to get a feel for what's going to happen.

The Sentiment Performance Indicator takes this type of activity to a whole new level. Instead of working on largely "seat of the pants" sentiment, the Sentiment Performance Indicator gives data that provides really strong correlations with likely market activity. In the chart on the right, reduced a bit but I hope still readable, shows in this instance a graph of the Dow Jones Industrial average in blue. The Sentiment Performance Indicator in this instance looks at all the news relating to the index and the companies that comprise it and out pops the sentiment data. Note how the green line, showing positive sentiment, tracks strongly ahead of negative sentiment for today before the market opened. Note the strong correlation with how the market performed after the open. Note also that as positive sentiment began to drop and close in on negative sentiment that the market levels out. Highly predictive.

Jeff walked me through similar displays for individual stocks and the data correlations were truly eye-popping - this coming from someone who stared at Reuters and Quotron screens and wallboards for more than a decade. What I found interesting was not only how closely the sentiment data tracked and predicted subsequent stock performance but also how changes in sentiment correlated closely to typical trading activities. For example, in one particular example Jeff showed a stock where negative sentiment rose sharply and there was a subsequent selloff. However, there was at the same time a steep fall in negative sentiment but no increase in positive sentiment. In other words, once a stock starts falling from bad news the damage is done and it will keep falling until there is countervailing news - to put it another way, once you have bad news, no news is the equivalent of bad news. That is a very, very accurate portrayal of real-life market activity.

Another example of a display in the Market Sentiment Indicator is a simple tool that shows cumulative sentiment data, the top positive companies and the top negative companies. Very easy to interpret - and very useful not only to securities traders but investor relations, management dashboards and other business applications where there is a need to see at a glance the real-time changes to how companies are being perceived in the marketplace.

This is certainly not the first sentiment analysis tool on the marketplace and no doubt there are several major investment banks, asset management firms and hedge funds that have cooked up their own custom version of such a tool. But I must say that to my jaded eyes this was one of the most powerful applications of semantic content analysis that I have seen in a long time. The top positive/bottom negative display should be on every desk tracking U.S. markets unquestionably, an invaluable tool that can help financial experts prepare for their trading day effectively and to get a handle on how trends are likely to unfold during the day.

More sophisticated tools are no doubt required for sentiment analysis to trigger low-latency basket trading during the market day, but for moving one's seat-of-the-pants sense of market sentiment into more firmly grounded views of market realities, especially in those critical minutes before markets open, this has to be one of the more powerful human-oriented tools that I have seen since PCs first started providing bar and line charts for securities analysis. No kidding. Thanks, Jeff, for a demonstration of such a simple yet powerful application of value applied to aggregated content.

Labels: financial information, market analysis, market intelligence, market sentiment, Semantic Web, sentiment analysis, web harvesting, yellowbrix

I've done quite a bit of research through the years for people in the securities ratings industry, a very interesting arena in which financial experts from major ratings agencies are paid by institution to rate the financial quality of their debt and stocks issued and traded in the securities marketplace. In turn these ratings agencies sell their ratings research to financial content vendors and directly to financial institutions. The content side of the business is nowhere near as lucrative as the ratings side, especially in the arena of stock research, where ratings agencies must now compete with independent research mandated by reform-oriented regulations. But in the arena of structured finance, in which bonds, mortgages and other types of potentially risky investments are repackaged into portfolios that offer more understandable and acceptable risk, ratings research has been in theory a useful tool to help people understand these complex investments and to provide market liquidity that might not otherwise exist.

That is, until the current mortgage crisis erupted. In many instances major ratings agencies were assigning very rosy ratings to the structured finance packages developed to package highly risky mortgage debt into more palatable forms. Yet these complex packages went south very quickly in the markets once many of the underlying borrowers failed to be able to adjust to the draconian interest rates that were triggered by their home loans' contractual terms over time. In short much of the market for these mortgage-backed structured investments, supposedly built on the highest quality research and analysis into investment quality by major ratings agencies, was built upon sand that crumbled away at the first real signs of financial trouble.

It would be unfair to assign blame to ratings agencies entirely for this whole mess, but from the perspective of the content industry the role of ratings agencies in this now-global financial disaster calls into question just what it is that people are paying for when they purchase financial research from ratings agencies and other suppliers of premium business information. The main problem that I perceive is that there has been an erosion of the power of editorial checkpoints within the ratings agencies that were supposed to act as a strong counterbalance to the all-too-natural tendency to put the lucrative process of getting paid by an institution to offer an opinion about their securites ahead of the objectivity of the research produced by that process. For debt markets rating the risk of securities is one of the oldest "cash cow" businesses in financial information, a tight setup in which just a few government-recognized agencies in the U.S. get rate bonds and structured finance debt packages with no real competition. It's no surprise, then, that pricey ratings contracts from debt issuers lured ratings agencies into editorial complacency.

The securities industry, of course, is not the only instance of such cozy setups. For example, we all know that there is an inherently incestuous relationship between major I.T research firms and vendors eager to have their products appear in their widely distributed research papers focused on specific types of technology solutions. B2B and consumer magazines reliant on income from major advertisers feel the pull of major accounts who are eager to have their products treated fairly by their editorial staffs in their articles and product comparisons - especially in niche market publications where there are a relative handful of major advertisers available. Bias is always a temptation when the bottom line beckons.

But in the instance of financial securities the stakes can be much higher, as seen in the trillion-plus U.S. Dollar estimate for settling out the bad debt in the marketplace. The moral of the story should be clear to all content providers: the cost of compromising editorial quality can be far greater than your own bottom line in the short run, and can level the value of your brand as a source of editorial quality in the long run.

Labels: financial information, mortgage crisis, Quality, ratings agencies

Agricultural market information providers have been key innovators for many years in trying to bring buyers and sellers together into highly efficient global markets for agricultural products. But while many information vendors have tried to service these markets well with quotes, news, analysis and weather forecasting oftentimes the upside for these traditionally expensive services have not been big moneymakers in the lean-and-mean farm belts of the U.S. and Canada. At the same time online financial information services such as Yahoo! Finance and other major portals do a great job at covering major stock markets but leave agricultural futures in the lurch for the most part.

I find it interesting, then, that Interactive Data Corporation has teamed with agribusiness giant Cargill to announce a new portal providing free financial futures markets information on the Web. Aimed primarily towards people in agricultural markets who sell commodities to Cargill, The portal is on one level a fairly straightforward presentation of quotes in day and electronic markets for major grains, livestock and energy products along with market news, weather forecasts and market commentary from Cargill market experts. A nice little twist is that the content can be tailored by postal code to enable someone to get a sense of the market conditions for facilities where they can actuall sell their commodities to Cargill (nope, no grain elevators near Westport, CT).

But the other aspect of the portal is that it is captive, purely a Cargill platform that's being used to disseminate basic market information wrapped in marketing messages both obvious and subtle. Why mess with other marketing messages when people an turn to you for data and see nothing but your brand every day? The point is also underscored a little more subtly with the provision of market commentary from Cargill: it's professionally done and insightful, to be sure, but it's Cargill's take on the markets without having to wait for the media to show up and ask for their opinion. This is a great way for people to get rich data from IDC, a trusted source of market information, while enabling Cargill to build relationships with suppliers and build brand value. IDC benefits not only by getting its content into yet another online portal, to be sure, but also increases their experience in using corporate marketing dollars to sponsor their information.

While good news for IDC and Cargill it's yet another example of how B2B marketers are able to create their own relationships with markets through content without having to rely on traditional B2B media outlets. That's not going to stop farmers from pickup up other sources of agricultural news necessarily but it's a good example of how more and more marketing dollars that used to support those publications are paying for more captive audiences who can engage their brands inside their everyday workflow. It's also yet another example of how business information services can partner with corporations with marketing goals in ways previously reserved for trade publishers. B2B media producers need to think more like IDC and consider how they move more aggressively to help marketers build their brands wherever they want them built with their publishing expertise.

Labels: agricultural, Business Information, cargill, financial information, futures, IDC, interactive data corporation, rich data

When I signed up to speak at the Infovision 2007 conference in Mumbai last month I found myself back in touch with S. Swaminathan, the CEO and founder of IRIS, one of the leading Indian technology services providers supporting the global content industry. I have come to know Swaminathan fairly well through our business discussions at major conferences in the past few years, so I was more than grateful when he offered me a driver for my short but memorable tour of Mumbai. After several hours of puttering around some of the local sites I met up with Swaminathan for lunch at the historic Taj Mahal Hotel down by the Gateway to India waterfront arch.

Swaminathan cuts the prototypical figure of content entrepreneurs in today's India: energetically brilliant, eloquent, well-versed in the ways of European and American markets and cultures yet thoroughly Indian. He is keenly aware of how far India has come through global outsourcing but also aware of its potential to become a global leader in content services innovation in its own right. This is reflected somewhat in IRIS' own market footprint. Long known for quality outsourcing services supporting the financial information industry, IRIS is also very active in developing key information delivery services for India's stock markets. Where in the U.S. institutions are just beginning to tinker with delivering corporate financial reports to the government in the XBRL industry standard format IRIS has been instrumental in getting XBRL adopted and implemented as a financial reporting standard throughout India.

It is this combination of global markets awareness in combination with the rapid transformation of their domestic content markets that is most intriguing to me about India today. Certainly there have been some Indian companies which have broken out of the outsourcing profile to bring full-blown content technology products to global markets, but many of these did so in part because there were so few opportunities at the time to develop significant product offerings domestically. As India's media and business information markets begin to take off in their own right, there is a growing surge of home-grown content services which are maturing quite rapidly from the relatively primitive efforts of just a couple of years ago - though still with rough edges at times. The Rediff portal is an interesting example of the limits and potential of India's broadening online culture. Reasonably up to date in its feature set compared to Western media portals, things get interesting when you turn to its search engine, which offers searching in both English and a number of India's more than 100 languages and dialects.

This confluence of global awareness, innovation, media savvy and multilingual domestic culture that is perhaps India's strongest suit for becoming a leader in global content markets. Certainly search engines such as in China's Baidu portal offer more overall sophistication than Rediff at this point and Europeans have been able to develop multilingual services with an English language overlay but in neither of these instances do you have an outlook on one's own nation as such a stew of multilingual multiculturalism powered by such a strong technology presence. If India can get its own content services thoroughly up to snuff while at the same time developing expertise on global markets via outsourcing, how far are we from the day when it becomes a global leader via its own content services? Things do not always move swiftly and according to plan in this highly complex nation, but I can see the outlines of a new source of global content entrepreneurship emerging from India over the next few years that is likely to raise more than a few eyebrows in the content industry. My thanks again to Swaminathan for being such a gracious host, it was such a pleasure to experience Indian hospitality through his sincere courtesy.

Labels: financial information, india, iris, mumbai, swamithan, xbrl

The investment research marketplace is one of the most intensively cultivated business information sectors, with major investment banks, buy-side fund managers, ratings companies, publishers, media companies and independent research firms all putting their finger in the pie to try to pull out the plum of valued insights and recommendations. With such a daunting field of players you have to give credit to Wikinvest for even thinking about trying something new.

Wikinvest enables contributors to build up profiles of companies similar to what one gets in a typical stock profile report, with a neutral "just the facts" default tab for each company complemented by tabs that give indications as to what the bullish and bearish sentiments are on the investment. While these reports leverage mostly bog-standard MediaWiki technology they are attractive and readable for most purposes. They also have a nifty graphing package similar to that used in Google Finance that contributors can use to create annotations that correlate market movement to events affecting the company's stock.

Wikinvest company reports are complemented by topical concept reports, which lay out the details of major trends and investment methodologies. Like company reports each concept report also includes an area in which "bulls" and "bears" can add their own take on the impact of sub-prime loans on markets. There are also nice features such as the ability to add user-specific bookmarks on each page's sidebar and the ability to type in partial company names or concepts instead of ticker codes into their type-ahead search box to get some meaningful content. Top contributors to Wikinvest get titles akin to Wall Street professional titles - "Senior Director" is the label for the top grade of Wikinvest contributors.

For a just-out-of-the-box tool Wikinvest is already populated with a fair amount of content - 100,000 contributions are claimed - but it's content coming mostly from young enthusiasts rather than from seasoned investment analysts. Don't let the "Senior Director" label fool you - look at the bios of these leading contributors and you'll find many folks who have not yet made it out of school. That said, when one thinks of all of the off-shore operations cranking out stock reports these days, this is perhaps not the worst thing in a world of 80/20-rule online content. The concepts reports - basically a topical financial encyclopedia - have potential and are generally pretty well-written but it needs far more reports, as well as support for basic industry terms such as "uptick rule" found in sites such as Investopedia or Wikipedia.

This is a very day-one effort at an investment-oriented Wiki, and for day one it seems to have done a lot of the right things. The 100,000 articles is about the scale of the original Wikipedia, so there's reason to think that it will attract quality contributions over time that will flesh out content in this market sector. The use of a neutral/bull/bear model to gather content is also useful, helping to channel opinions to places where they're useful and hopefully helping to avoid opinion turning into facts too often. It's a model for Wiki content collection that others should consider to address topics that draw a lot of segmented opinions. The ability to define new concept articles on the fly also allows Wikinvest to be a fresh and topical source of content that will draw people on a regular basis, giving the potential for building audience loyalty as a must-stop bookmark.

Will Wikinvest really fly? I think the real question is rather how does any sector-specific Wiki project manage to build authoritative content that will attract an audience and quality contributions. From this perspective I think that Wikinvest is a pretty good roadmap into how Wiki technology can be used to build communities of interest around professional-grade topics that can become a strong media source over time. I expect that Wikinvest will have relatively slow and steady growth over the next few months and then either be snatched up by a major portal (is the similarity to Google Finance charting a hint as to their exit strategy?) or outclassed by a startup with deeper pockets and more of an ability to attract higher-grade contributors. But then again, with a little more cash to accelerate content growth, Wikinvest could wind up being that better-financed startup themselves - and find themselves in a very interesting spot in the online content world.

Labels: Business Information, financial information, wikinvest, Wikipedia, Wikis

paidContent.org notes the Dow Jones boardroom resignation of Dieter von Holtzbrinck in protest over the pending News Corp deal, but away from the acquisition soap opera are some interesting details culled from the recent Dow Jones earnings report. Though overall earnings are down notably online revenues are up 5 percent and paid subscribers to The Wall Street Journal Online grew 23.6%, buoyed in part by a USD 99 combo package for the print and online edition. These are good numbers at a time in which business news is challenged in all directions by new sources. Think of the WSJ as the world's largest country club, a point of social distinction that allows one to join an elite (kind of) group for very nominal greens' fees.

It's a model that social media plays will be leveraging more in search of high-value focused market segments, which begs to some degree when WSJ will be doing more to integrate community features into their platform. I have great respect for Gordon Crovitz and his business acumen, but the WSJ's shyness on social media is likely to leave additional "gated community" revenues to others in time. And perhaps time will be the factor - they aren't growing any more WSJs any time soon, as Rupert Murdoch knows very well, so Crovitz and others with deeply entrenched media brands seem content to let their content become contextualized elsewhere. A little imagination is in order here to consider how to build a new clubhouse at this online country club - for premium fees, of course.

Meanwhile over at Dow Jones Enterprise Media the Factiva buyout makes things look temporarily rosy on the unit's top line but Factiva's compartively thin profits dragged down the unit's operating margins to 23.2 percent. The Enterprise Media unit is another example of where Clare Hart does a magnificent job of talking about Web 2.0 but so far has not really touched its potential to change the fundamental profitability of a licensed content aggregation business. By contrast Thomson Financial's recent deal to incorporate executive background briefings and private company profiles from Generate is a key foray to use Web content to build premium content revenues via direct extensions to their core content sets. The New Aggregation that we talked about a few years ago, in which publishers and aggregators must embrace Web-generated content and contexts aggressively to generate better margins, is now being embraced by key business information providers very aggressively.

Hopefully the Factiva buyout will enable Dow Jones to infuse their Factiva investment with more capabilities incorporating Web content that will improve both margins and content quality - once News Corp acquisition formalities have settled down. In the meantime here's hoping that Dow Jones' model for online and enterprise success continues to broaden both coverage and online audience engagement.

Labels: Dow Jones, earnings, Factiva, financial information, Generate, Thomson

It was a great SIFMA show in many ways, but also one which took me back to its roots. I remember when it was in much smaller quarters at New York's Sheraton Hotel, instead of its current footprint across three floors of the New York Hilton. Back in those days content technology advances offered relatively few trading advantages to individual organizations on the desktop - it was more a matter of making sure that you had the right specialized equipment in the back rooms feeding the trading floor. Years later we seem to be back where we started. The drive to reduce the cost of trading transactions in the face of disappearing trading profits in public markets has made the SIFMA show a gathering with relatively few high-profile desktop trading solutions being touted to an ever-decreasing population of decision-makers purchasing them. Traffic was reasonable but clearly down from earlier years. It's a flat world out there in finance - except in niches such as hedge funds where information innovation still drives profitable trading strategies.

There were a few key themes that I saw taking shape at this year's show:

Everything old is new again. I enjoyed a few minutes chatting with Jeffery Wells, now VP of Product Management at Exegy, a provider of infrastructure for ultra-low latency market data feed processing. For several years the solution touted by Wall Street firms was to shove huge banks of standardized blade servers at trade tickers to be able to keep up with information surges. But with the cost of energy increasing rapidly greater single-platform efficiencies are beginning to look more attractive. Shades of the "minicomputer" revolution of the 1970s and 1980s - custom computing platforms are coming back, thanks to new economics in trading.

ASP financial content services are becoming a reality. While financial trading partners have long used private networks to communicate with one another the push for cost controls is leading to some interesting developments in networked services. Collabnet is a service that enables customers that include investment banks to collaborate on software development with outsourcing partners in Asia and elsewhere. What's interesting is that Collabnet provides this as an ASP-based service instead of installing it in-house on private servers and networks. Nothing new in the greater world of business but remarkable when you consider how reluctant investment banks have been to open their operations up to ASP services before. Also demoing at the show was Salesforce.com, an ASP-based sales force automation tool with financial modules integrated via its AppExchange service. Is Wall Street ready for a wider range of ASP-based content services? The push for economic operations seems to be pushing secure ASP content solutions to the forefront. Don't rule them out from your own product plans, but be ready to have your answers in hand for how you manage security.

Rapid development of executable trading strategies is powering low-latency data feeds. Automated trading based on high-speed data feeds has been around for years, but these days "real time" feeds need to have sub-millisecond delays for trading strategies to be effective. But equally important is the ability to tune trading strategies as rapidly as possible to take advantage of the speed of these feeds. Vendors such as Progress Software were demonstrating capabilities that allow new trading strategies for low-latency feeds to be turned around in a few hours. As important as the speed of feeds can be the ability to translate your knowledge of market conditions into automated decision-making seems to be fueling many boutique solutions.

Mining the Web and other sources is helping banks to build their own custom content. One of the more exciting types of tools highlighted at the show were packages that made it easier to mine and aggregate content from both traditional and non-traditional sources in interesting ways. FirstRain was demonstrating highly personalized research services that enable its clients to get information from many major published sources and internal sources tailored to their exact needs. Connotate was demonstrating Web mining capabilities that enable investment banks and other institutions to quickly develop custom research and data from any number of online and proprietary sources. While getting high-quality subscription databases is still an important part of the research equation for finance tools such as Connotate and FirstRain are allowing institutions to define custom sources of content that are feeding decision-making processes with unique insights that may give financial institutions an advantage in the marketplace. With the ability to define structured content dynamically these types of services are accelerating the ability of institutions to gain insights from any potentially valuable content source.

What happened to the graphs? For years you could walk down the aisles of this exhibit hall and be overwhelmed by the number of charting packages made available by content and software vendors. While charts were certainly a part of the mix, the emphasis on automated execution via low-latency feeds has placed more of the analysis investment for real-time content into algorithmic trading packages. However, a retail-oriented analytics package from Blocks combined a drag-and-drop financial modeling package with a charting package to enable retail investors to develop sophisticated trading strategies and to trigger them off of charted real-time data events. A nifty combination that would have been the envy of many a trader not so many years ago and now available for you and me. Graphing is still an important analysis tool for financial content but it's far from the cutting edge for most financial services these days.

Lots and lots of small companies. While SIFMA has always had its fair share of up-and-coming companies in its mix the show was notably heavy with startups and small innovators this year. Certainly Reuters, Thomson, Sungard, IBM and others had significant footprints this year but there were many more small companies working their way into main-floor and mid-floor footprints that would have been relegated to upper-floor boonies in past years. While not necessarily a good sign for the short run I take this as a good sign for the years ahead. Hopefully we're witnessing a new wave of innovation for the financial content industry that will begin to drive new products and services away from traditional data delivery platforms and towards more innovative forms of collaboration and execution. This is an industry starved for really fresh ideas right now, but with so many fundamental infrastructure issues sussed out in recent years expect financial institutions to begin to invest anew in fresh looks at the world of financial content.

So yet another SIFMA show sails into history. Let's hope that next year's addition features a little more buzz and excitement in the hall generated by something other than Sopranos stars, slot cars and scantily clad young ladies.

Labels: Business Information, events, financial information, SIFMA

This year's Securities Industry and Financial Markets Association (SIFMA) Technology Management Conference & Exhibit featured a wide array of innovators trying to find niches against a healthy handful of survivors servicing a greatly consolidated industry that seeks to squeeze out productivity as never before. Today's video features lots of fun little takes along with demos and pitches from Reuters, FirstRain, Connotate, Collabnet.com, Blocks, Success Metrics and Smart Trade. Our written commentary on the show is here.

Labels: financial information, shoreviews, SIFMA

A preview of the SIFMA show, thoughts on Jerry Yang in it for the long haul against Google, Reuters Interactive and Science Magazine's content previews. Let us know what you'd like to see in our ShoreViews reports!

Labels: financial information, Reuters Interactive, science magazine, shoreviews, video, Yahoo

Advanced Trading notes how the introduction of more automated quotes and trading interfaces from the New York Stock Exchange for bonds and other fixed income securities and more widely available fixed income pricing from NASDAQ's TRACE service are helping to drive a more algorithm-driven fixewd income marketplace. This premise is a stretch at best in terms of the current reality: NYSE supports trading for only the most liquid corporate bonds, leaving private markets to find their own buyers and sellers through more conventional channels for the vast ocean of debt beyond NYSE's trading operations. But it's fair to say that the sophistication of pre-trade evaluation tools for fixed income analysts and portfolio managers outstrips the ability of people using those tools to execute on their analysis effectively.

With such low liquidity in most fixed income markets it's not likely that improved trade execution channels alone are going to be enough to drive demand to the point where we'll see the kind of sub-microsecond automated algorithmic trading opportunities that we see in equities markets any time soon. But the levels afforded by improving execution technologies appear to be rising to the point that there are new opportunities appearing for decision support services. Most of these opportunities, though, are not likely to form around typical desktop technologies or back-office trading systems.

Instead what we're likely to see are systems that allow participants in the fixed income marketplace to quantify more effectively "soft" marketplace factors such as market sentiment and likely ratings changes. These factors are important in equities markets as well but in the more leisurely world of fixed income markets they have the ability to impact actual execution factors through human analysis far more effectively. We'll be hearing more about how automated trading systems are going to "revolutionize" debt markets but expect the real revolution to come in pre-trade support services that enable niche markets to understand the human-influenced trading landscape.

Labels: financial information, fixed income, Trends

If scholarly publishers are unsure as to whether social media can act as a cornerstone for research they should consider the plans of Reuters (Guardian) to introduce a private social media service for financial analysts later this year. While details are sketchy at this stage, it appears that Reuters will enable researchers and other financial professionals to post out analysis, data and other key information that can be picked up by Reuters subscribers on a premium basis. The 70,000-plus users already connected to the Reuters Messaging service are expected to provide the core audience for this service and will no doubt also provide the core of its contributors also. We'll see what the final product looks like but it's a shrewd move to leverage the power of Web publishing in a way that may yet unseat Bloomberg's messaging service as the core of financial dialogues in institutional trading circles.

It's this kind of advanced thinking about how audiences want to be connected to one another more than to publishers that's lacking from so much of the print-oriented publishing world. As the content industry becomes more real-time in its overall contours it should recognize that there is plenty of money to be made in enabling conversations amongst connected peers - enough to power the financial industry to record profits in 2006, by the way. Instead of looking at the bottom line of their clients more publishers need to look at their top lines and to consider how their services are contributing to overall revenues and profitability for their customers. If scholarly publishers were servicing Wall Street they'd be talking about the importance of ticker tape and carrier pigeons to investment banking. Publishers can do far better than that - and, yet again, Reuters has.

Labels: financial information, real-time, Reuters, scholarly publishing