When Thomson Corp. and Reuters Group PLC joined forces in 2008, they made no secret about their intention to take on financial services behemoth Bloomberg LP.
After two years of development, Thomson Reuters is deploying its all-in-one news and financial data product, Eikon, taking aim at Bloomberg's stronghold in the financial-services industry.
Thomson Reuters faces no shortage of challenges as it battles for market share with Eikon. Not only is it up against a dominant front-runner, it must also fend off smaller companies, such as Capital IQ, that are gaining prominence in finance circles. And Bloomberg continues to bulk up its product by building out its news division and targeting different markets such as law and sports.
Eikon's biggest sell is that everything is now in one system, Thomson Reuters officials say. The firm has long offered financial-service products such as Bridge and 3000 Xtra, but each played to different strengths.
"For the first time, really, we're getting all of our assets together in one place," said Devin Wenig, the chief executive officer of Thomson Reuters' markets division.
Eikon operates much like a Web browser and was modelled off Mozilla Firefox and Google Chrome, mimicking the surfing experience with navigation tools such as a "back" button. Eikon is segmented into different markets, such as fixed income, equities, and currencies, and users can get an overview of what is happening in each. When users look up a specific stock, they are brought to an all-in-one screen that provides a company description, trading activity, an overview of upcoming events, key financial ratios, recent regulatory filings and more. Traders can execute orders directly from Eikon because it can serve as a front-end system that ties into their own trading programs.
Bloomberg, for its part, has not waited patiently for new competition to arise. The company now has 288,000 users, an "all-time record high" said spokesperson Pam Snook, and each got access to the updated Launchpad tool, which makes the system much more user-friendly.
Intuitive search is one of its key features. Historically, users needed to know exact stock tickers and Bloomberg codes, such as DVD, for dividend summaries. Now they can simply start typing "div" and their terminal will display a number of options. Bloomberg has also updated its communication system, enabling users to share screen captures and live data.
However, both Eikon and Bloomberg must compete with younger companies such as Capital IQ, which provide financial analysis data typically used by investment banks. The new players have pushed data reliability to the forefront because users don't have time to double-check accuracy when modelling takeovers or new capital projects. On that front, Capital IQ explains where every number comes from, something vice-president John Dunchick refers to as "auditability."
Thomson Reuters acknowledges the importance of users trusting their information. "We've had a major push to assure consistency, coherency, and accuracy of data," Mr. Wenig said.
Although the companies do not publicly disclose their pricing, a 2009 New York Times story pegged the cost of a Bloomberg membership at around $20,000 (U.S.) annually. A Thomson spokesperson said their price is "comparable and competitive to what is being offered in the market."
TRACKING THE MARKET
Investors have a growing number of ways to track the market, for free.
Fidessa Group PLC, which makes trading applications, on Monday launched its "Fragulator" in Canada and other big markets such as the U.S. and Japan. The service lets users see a stock's market fragmentation - in other words, watch stocks trading on different exchanges.
In Canada, equities trading goes beyond the Toronto Stock Exchange. Alpha Trading Systems has shaken up the environment, along with other alternative trading platforms such as Chi-X Canada and Pure Trading.
Services that help investors track trading on different exchanges could help address worries that some orders are placed on only a few of the exchanges. Brokerages are legally required to obtain the best price for their clients across all markets.
Moreover, the Fragulator offers a variety of day-to-day trading details, such as the sizes of trades on a given day and volume-weighted average prices.
Fidessa stresses its Fragulator data is unbiased because "we're not in the [trading]execution business," managing director Martin Hakker said.