Big data is a powerful tool for companies and investors, but what happens if the gathered information is misused? That is what happened with Bloomberg on Friday. The company raised eyebrows across Wall Street and beyond when it was revealed that reporters for its news unit were tapping secretive information traders use on a daily basis.
Bloomberg News admitted to the fact that reporters extracted subscribers' private information through the company's data terminals in order to break news. Bloomberg terminals are found in nearly every banking and trading company, including the Federal Reserve.
The unique difference between Bloomberg and other data houses is that they are both a news organization as well as a data provider.
Tony Fratto, former White House deputy press secretary and current director at Hamilton Place Strategies, told “Big Data Download,” “There are two kinds of businesses, providing data to market participants and reporting on news. The ethics of journalism are different from the kind of information that market participants want, and that is always going to create problems for these kinds of organizations.”
Fratto said, “They need to have some kind of Chinese wall between the news-gathering and news-reporting side of the business, and the business side of it and market-making and data-providing that Bloomberg does.”