New York – Well, the 800 pound gorilla just gained some weight. A press release this morning announced an exclusive partnership between Bloomberg and Gerson Lehrman Group (GLG) to make 50,000 experts available to Bloomberg Professional users. This is a big development in the primary research space as well as in the market data services space.
Winners and Winners
On the surface this is a distribution deal, but under the Kimono there is a lot more to it. Bloomberg will get a much stickier terminal, with valued-added primary research and GLG will gain access to Bloomberg’s global client base.
Clients that have arrangements with GLG will be able to use the Bloomberg front end to find experts and access news, commentary, etc. and even conduct a consultation with a GLG expert within the Bloomberg platform. Bloomberg Professional users that are not GLG clients, will get a trial of their expert network services.
As part of the partnership Bloomberg Tradebook and GLG have agreed to conduct a substantial number of joint seminars, conferences and other events that will be beneficial to clients, as well as to their businesses. While Tradebook already has a well developed CSA program and already handles a good deal of GLG payments, the events and content can be expected to improve Tradebook’s business.
Product Evolution
On the surface, the mutual benefits are clear: Bloomberg adds valuable content to its platform and GLG increases its visibility to a number of potential new clients. What is interesting is that the actual client transactions will take place within the Bloomberg system. GLG will make its GLG News available on Bloomberg. Within the GLG News stories and other news stories there will be links to expert bios that the client can browse through. Should the client wish to consult with the expert, the consultation will take place through the Bloomberg system. From the clients’ perspective, this is a huge step—allowing users to access experts through the same system as they get their news, quotes and analytics. For the first time expert network access will be integrated into the analysts’ workflow.
It is interesting to note that Bloomberg previously tried to integrate healthcare surveys into their platform, when they did a deal with Sermo a few years ago.
Expert Network Revolution
This deal is a coup for Bloomberg and for GLG, but it also has ramifications for the expert network space in general. While there are north of 40 providers of expert networks available to investment professionals, GLG has close to 2/3 market share (by revenue). We expect this deal to further concentrate the expert network sector. If an analyst or PM can receive primary research by clicking through on a link in a news story, the ease of use alone almost makes the previous system seem archaic by comparison. Consequently, we would not be surprised if, in the future, other expert networks look for ways to integrate access to their experts into the buy-side analysts’ workflow.