31 October 2014

Wall Street banks turn to messaging startup as Bloomberg alternative

04 August 2014  |  11389 views  |  0 Stock exchange numbers

A group of Wall Street banks, led by Goldman Sachs, are on the verge of buying a stake in instant messaging firm Perzo as they prepare to break free of their reliance on Bloomberg, according to Reuters.

The Instant Bloomberg chat system has long dominated Wall Street but it comes as part of a $20,000-a-year terminal package in an age when banks are bidding to slash costs.

Goldman, Morgan Stanley, JPMorgan Chase & Co, Bank of America, Deutsche Bank, HSBC and BlackRock are all now pondering investing in Perzo, which has developed free messaging apps, as an alternative, says Reuters, citing sources.

Last year relationships between Bloomberg and the banks took a hit when it emerged that the the firm's journalists had snooped on clients by monitoring page views and log-ins by traders using its desktop data terminals.

A deal for Perzo would not be the first time that banks have tried to loosen Bloomberg's grip on the instant messaging market. Several have signed up for a new open messaging network being set up by Markit and backed by Thomson Reuters.

Instant messaging and chat rooms have been in the spotlight recently, with banks banning traders from using them after they became fruitful hunting ground for regulators sniffing out market manipulation.

Logs of chats between traders on Bloomberg terminals and Thomson Reuters desktops have formed a central plank of investigations into the Libor fixing scandal and allegations of foreign exchange rates manipulation.

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