Re:Can the Bloomberg Terminal be "Toppled"?
by mattturck on Wednesday March 19, 2014 @05:01PM
(#7431831)
Yes, agreed. But the difficulty here is that a lot of those niches are very small, in terms of number of users. Assume for example you're building a product focused on munis, which I don't think is a very well covered niche for now. How many potential users are we talking about here? 20,000? A bit more maybe? Yet you need to build a whole technology platform to serve them. Only makes sense (from a venture perspective) if you use munis as a beachhead to expand into another area, but as it turns out, the next area requires you to pretty much start from scratch on a number of fronts, because it is going to be so specific. So building a large business here requires you to address a bunch of different niches and hire specific teams for each - lots of venture money required, IMHO.
But the returns can still be good.
Let's say you do just that, snag half the market and get 10k users each paying you $500/mo for their niche.
That's still a $60m/yr business.
As someone who has used Bloomberg's Terminal for 5 years: Bloomberg's sum of the parts product is far more valuable than the parts sold one by one - add to that the immediate top-knotch customer support 24/7/365 and breadth/depth of the data they have, Bloomberg is a killer product. IMHO, I really doubt any product decoupling will be of value to any of Bloomberg's current customers.
Re:Can the Bloomberg Terminal be "Toppled"?
by bdunbar on Thursday March 20, 2014 @10:10AM
(#7435582)
> to any of Bloomberg's current customers.
I'm not the only person to have thought about this - what about new guys who can use 'a Bloomberg' but can't afford the price? Is there a way forward for these guys to create new customers?
Absolutely, there are many customers left out at +$20k a terminal per year. The questions is, which of Bloomberg's services they want the most. I wished I knew the answer.
Wait. You don't need to. Niches actually make it easy to take apart. Concentrate on one niche and do it better, faster, and cheaper than Bloomberg.
Having been in finance, there is a lot of unhappy Bloomberg users. The organization itself, however, is pretty top-notch. They have some really brilliant people working there and the customer service is quite good.
That said, I think in a classic innovator's dilemma scenario, one could build a company that has very few features but does it well and don't actually need to provide support. More importantly, do it for cheap.
Then again, "cheap" isn't usually what finance companies look for. The inefficiencies of that industry is staggering. So long as they come out ahead, it might not be worth it for them to save some money but have to live with limitations.
So maybe the right approach is to target some segment of the finance industry that cares only about a niche and has to really watch their bottom lines.