Tues 9July2013 Well as far as business information providers go, it's 'Here We Go Again!' 

After the 'Bloomberg Breach' we have the 'Reuters Reach'! 

Today's lead story in the FT reports that Thomson Reuters is under investigation for the practice of 'early releasing' the results of the Thomson Reuters/University of Michigan ­Surveys of Consumers, produced twice a month under an arrangement in which the company pays the university more than $1m a year. Apprarently, this survey has long been available to subscribers to its data terminals five minutes before the wider market sees the press release.

In their race to 'Reach' for profits, Thomson Reuters have created an ethical dillema for the business information industry worse than the Bloomberg Breach (see below). The only excuse for the management of Reuters is that its director team have been watching the movie 'Dumb and Dumber' rather than the 1980s classic 'Trading Places'. For if they had been watching the latter they would have remembered that the information that they sell is: MARKET SENSITIVE STUPID!

By paying money to a respected institution like the University of Michigan to deliver these surveys and then selling preferred access to the data is right up there in terms of unethical behaviour. Just as in the movie Trading Places where the protagonists sought to get a jump on the market for orange futures by knowing production yields, so high frequency traders try to make profits by wringing nano second advantages out of their information sources. At best this can be justified as these traders having better technology prowess but Reuters just added to their unfair positions relative to home or day traders in the markets.

It is right that the actions of Thomson Reuters should be condemned. However, the actions of this firm have been so brazen that they may also result in new government regulations that further distort the market for business information for everyone and raise barriers to entry for new entrants into this market.

Into Business Information? Check Out the: The 'Infoworker Bullseye' -  Simple Segmentation of the 'Paid For' Online Global Business Information Space.

14May2013 What an adrenalin fuelled weekend for Big Data and Business Information junkies! Four quite separate episodes that highlight why digital information is such a powerful weapon susceptible to misuse in modern economies, business and life.  

First, the US Internal Revenue Service admits that it used its powers to demand information to 'unfairly' target Conservative Groups such as the Tea Party. (See here) 

Second, one of the most incredible cybercrime global bank heists of all time was perpetrated against Middle East Banks. (A must read here) 

Third, the G7 affirmed at their meeting in Alyesbury (of all places!) to step up their ground breaking information sharing agreement on offshore tax havens after a massive data leak from these places exposed dark financial secrets. (See Here)

Fourth, business data provider Bloomberg may face an investigation by the Feds after it admits that its news reporters had access to sensitive information about customers' activities on Bloomberg financial data terminals, such as subscribers' contact information and login activity, all of which was used to advance reporting. On Monday, editor-in-chief Matthew Winkler apologised for allowing journalists to use the usage statistics, calling it "inexcusable" and that customer data was protected.

Arguably this last episode is most shocking given the fact integrity and credibility are two essential elements for any Business Information Provider like Bloomberg. That the political appointees at the IRS might want to advance their patron's cause (with or without their knowledge) is hardly surprising if you understand politics inside the Beltway. That criminals should be smarter than the banks and their (in this case) Indian outsourced IT suppliers has been proven time and time again. While the fact that the G7 are now taking measures against offshore tax havens, many of which are within their arms-length jurisdictions, is inevitable given domestic political and economic pressures. However, it is clear that while Bloomberg makes a great effort to protect its core data sets, it seems it does not take as great a care with its customer usage statistics.

For other Business Information Providers this is a wake up call for they are already under the microscope as a result of two seemingly unstoppable mega-trends affecting their industry: Cloud Computing and Big Data. Increasingly the offerings of Business Information Providers trumpet their expertise in these areas. (DnB, Experian, Equifax)

Any CIO of a large corporate customer of these firms making a pitch to their own Board about moving sensitive corporate data from on-premise servers to the Cloud will be faced with questions about security. Similarly, privacy concerns are at the heart of both government and marketers attempts to leverage value from Big Data projects.

As a recent article in Foreign Policy says: "Big Data helps answer what, not why, and often that's good enough...The Internet has reshaped how humanity communicates. Big Data is different: it marks a transformation in how society processes information." (My italics) 

In this context, if there is a lesson from the 'Bloomberg Breach' for Business Information Providers it is that customer usage patterns and how customers process their information, are just as valuable a commodity in modern data analysis as mining the raw data itself. As a result these data usage sets need to be covered by security policies too. 

Of course, in many cases such patterns will be protected by the privacy rules governing access to customer accounts but these may well need reviewing in light of the ways in which patterns can be deemed enough to determine what course a company is pursuing even if the patterns alone cannot answer why. 

The increasingly sophisticated risk products on offer from global business information providers mean that patterns can be discerned even if key client data is protected. A customer service representative who can view a customers' credit information portfolio can gain useful insights into which markets that client is targeting and getting business. A list of industry or market research reports that a client company is purchasing may be a tell as to future business or acquisition strategies. These are simple examples and not those where a Business Information Providers' people can view Big Data outcomes connected to spatial or cluster analysis. It would be interesting to see how much access to the queries that customer service and marketing people have in these instances. 

The bottom line is, that customer service representatives may not be as inquisitive or knowledgeable as Bloomberg journalists. But as last weekend's Middle East Bank heist shows, there are always external nefarious people out there who are looking to tap and trap the less knowledgeable in order to connect the Dots!

Into Business Information? Check Out the: The 'Infoworker Bullseye' -  Simple Segmentation of the 'Paid For' Online Global Business Information Space.

For the past 15 years I have observed the growth of the online 'business information
market' and come to the conclusion that the key players in it either over complicate their offering, screw up their pricing model or have no idea where they are trying to add real value to potential customers' businesses.

In fact, even finding and agreeing a definition of this market is confusing since most attempts at definition simply state categories of data that should be considered 'business information' as opposed to, say, 'technical and medical' and 'educational and training' content. Check out this Wiki definition for 'Business Information', then let me know by comment below if you find a more frustratingly weak entry!

As an eBusiness leader at GE, I had a budget for business information worth of tens of thousand pounds and wasn't inclined to spend any of it unless one of my team could quantify in some way its likely affect on my revenue numbers. So for me, 'business information' is easily defined.   It is data or content provided by a Third Party that can impact the revenue prospects of the end User or Customer who purchases or receives it. 

At this point is important to distinguish between Users and Customers. I covet 'customers' because these are entities in my world (companies, organisations, governments, departments, agencies, charities, partnerships, sole traders, contractors, consultants, retail consumers) who actually pay for business information rather than peruse and consume 'free stuff'. Free riders are mere 'Users' and may have value if you have enough of them visiting your business information portal and can leverage some advertising money out of their presence or incorporate them into some sort of 'FREEmium' model. However, the days of surviving in this market by just accumulating eyeballs are long gone. Perhaps, the best example of this Freemium model in the UK company credit reports market is: companycheck.co.uk.  This site not only has its comparative pricing pitched just right for its product set to flip Users into Customers but it is also optimally designed to entice and encapture. This is not an easy thing to do and has only been achieved through years of experience of trial and error by those behind the property. 

Still, getting and holding onto Customers is the real prize in the business information
market not least because as a VC I once pitched said, corporate customers 'do not do Freemium'. Which brings us nicely to the 'Infoworking Bullseye' illustrated above. Infoworkers are the profitable customer segment that enlightened business information providers should be targeting today.  They are where the growth is, and from where profitable growth will come in this space for years to come. They are rightly in the centre of the simple segmentation model introduced here. 
 
Since I have invented and refined the term 'infoworkers' over the past three years
with the help of anyone who will listen, I suppose the term deserves some explanation. For me, 'Infoworking' is the process of  building value adding or business relations amongst individuals OR organizations which not only search for, use and subscribe to business information as a part of their profit seeking activities but are also prepared to share additional data, knowledge and opinion with others about the value of that information to the outcome of such activities.

The fact that Infoworkers interact, share and subscribe means that they have skin in the game in the same way that passionate Facebook users optimise their presence. They are not only valuable paying customers in their own right but also enhance
existing information and generate additional data points that amplifies a business information providers' current product set. If a provider can create a critical mass of infoworkers - it ultimately creates a completely new information product set which, depending on the T+Cs governing the User/Customer community becomes a proprietary asset for the business.

As you can see from the illustration above, this is a cut above the existing retail (Business to Consumer or 'B2C') and corporate (Business to Business or 'B2B') markets (depicted by the two outside circles) that almost all business information providers are presently competing in. Of course, as I write, even in these markets as they stand there are some interesting scenarios developing such as: 
         
++ Will creditsafe’s new US offering kick D&B's butt in its core US market? (I certainly wouldn't bet against them.  D&B are a Supertanker waiting to be torpedoed in their 'home market'.)
++ Will Duedil (with its new money from its Wonga backers) make a breakthrough in the retail company information market in the UK and beyond? (Not a chance, with its
current pricing model.)
++ For how long can Experian maintain its company information business by leveraging its impregnable position on the consumer side without devaluing its commercial data through commoditisation? (This dysfunctional Behemoth seems to get away with almost anything business model wise so nothing would surprise me).
++ When will all business information providers realise that in visualisation and data analysis terms: ‘It's All About Spatial Stupid!' (Some are…so watch out…its
revolutionary).

Each and any of these scenarios may be worth a separate Blog entry, but the real prize is capturing the Infoworkers, where the business information provider interacts
with its customers, who in effect helps the provider to develop and extend its product. (In manufacturing circles they maybe known as ‘prosumers’ – B2C2B).  

It interesting to see that a US based startup called InfoArmy has had a go at this in a twisted sort of way – by attempting to use crowdsourcing to power its business model. The problem with this approach (which according to this article by Joachim C of the BIIA they now seem to recognise) is that the people who generate the data should not be solely motivated by direct compensation for information production. Also, as Joachim points out, this model may have floundered because the "company does not have a historic master file on companies to be able to verify the data provided by the  ‘army of researchers’" (which if true, is pretty lame given the amount of VC funding they had). However, the main reason why Infoarmy has stalled in my view is because, the best way to attract and do business with infoworkers is by delivering the data they receive as a by-product of another calling. That is, in order to create an Infoworker community, it is helpful to start with an attractive business information product(s) set as a foundation. If Infoarmy had started out as creditsafe, Graydon, Jordans, D&B or even the giant Experian they might had made a better fist of it. 

Now anyone who knows these business information providers, will understand that culturally they have neither the Vision nor the Balls to deliver on such an innovative strategy.  Which means that only TWO companies in my view are presently positioned globally to make the step up to infoworking because of the strengths of their respective online communities. These companies are: LinkedIn and Alibaba. LinkedIn has currently lost its way with its cluttered celebrity (er, sorry 'influencer') dominated approach to the provision of useful business information and Alibaba has lost Jack Ma to retirement – arguably the greatest leader of a business information provider that you have never heard of.   
 
All of this means that the battle for precious Infoworkers is wide open.  It’s still all to play for in the months to come. So if you have the capital, the drive and the ambition then give me a call because I have a plan that revolves around Purpose, Platforms and Partners.  I am, right now, the 'Man with the 3P Infoworker Plan!'...
 
Please feel free to rip or mash this blog piece.  All I ask is that you credit me with the 'Infoworker/Infoworking' idea if you use it since I have been on this for a while. I also run a one-day workshop or individual sessions entitled 'Making Money in the Business Information Market' which includes some of the above ideas as well as some further analysis of competitor and product dynamics.  The workshop is £2000 which includes a day's preparation to understand your company's specific requirements.
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