Bloomberg News is in full damage control mode this weekend after having to admit that its reporters had been looking in on Bloomberg terminal users' subscriber information.
The company confirmed that reporters at Bloomberg News, the journalism arm of Bloomberg L.P., had for years used the company’s terminals to monitor when subscribers had logged onto the service and to find out what types of functions, like the news wire, corporate bond trades or an equities index, they had looked at. Bloomberg terminals, which cost an average of more than $20,000 a year, are found in nearly every banking and trading company.
The story first broke yesterday morning, when the
New York Post reported that last month, a Bloomberg reporter told a Goldman Sachs executive that he'd noticed a partner hadn't logged into his Bloomberg terminal lately, making him wonder if he'd left the firm. It turns out that for a long time, Bloomberg reporters had the ability to view a list of subscribers at a firm, then peruse the subscriber's usage history. While they couldn't access trading information, reporters could view a subscriber's logon information, chat history, and statistics on when they used a specific function. That function was disabled after Goldman complained.
Bloomberg CEO Daniel Doctoroff sanguinely characterizes this now-disabled functionality as "a mistake." No, Daniel. This wasn't just a mistake--this was freaking scary.
Apparently this functionality is a legacy of Bloomberg's early days.
In the early 1990s, when Bloomberg L.P. had just started to build its news division, reporters were encouraged to leverage the terminals as a way to get a leg up on the competition, said several former employees who would discuss practices only anonymously. Reporters often went on sales calls to talk to banks and hedge funds about the news division to help the company sell terminals. The practice became much less pervasive as Bloomberg became an established news outlet, although many Bloomberg veterans still consider the news division solely a means to sell more terminals.
The most benign interpretation of this is that it was an early feature that was updated over the years, and nobody realized until now just how much information was accessible.