Many of us were confused and upset to discover that a global outage of service yesterday by terminals of news agency Bloomberg could have, quite literally, paralysing consequences.
On Friday at around 0830am London time the servers stopped for two hours. That’s two hours for subscribers and journalists.
The US-owned news agency is still investigating what caused the outage and some commentators have asked whether Bloomberg was hacked, possibly as an American site by North Korea.
Press rival Financial Times reported the rare almost solar eclipse moment in a less than sympathetic style, asking whether staff were twiddling their thumbs, then going on to quote someone clearly in editorial saying they were not twiddling but rather panicking and then commenting that staff were instructed to say nothing!
More sympathetic was direct rival Reuters’ coverage. Staff were instructed not to refer to events at Bloomberg that day, specifically not to gloat. Many Reuters journalists post on social media. So well done Reuters for handling the situation with care and responsibility.
It took several hours to resume the Bloomberg service.
But the service was embarrassingly down long enough for a 10am UK debt auction to be affected. Servers didn’t resume until around 1045am.
At stake the sale of short-dated UK Treasury bills.
During the week this could have affected any number of eurozone debt agencies powered by Bloomberg. As it was a Friday it just happened to clip a UK debt sale.
The T-Bill auction had to be recalled and it went through smoothly enough in the afternoon. But by then investors had to reprice their offers at prevailing levels.
Although unprecented and ultra-rare the situation does call into question debt offices’ reliance on one vendor or platform for conveyance or distribution of debt sales.
Many debt offices rely on Bloomberg but some use their own platforms in Europe.
Bloomberg has become incredibly influential as a platform in a short space of 25 years.
But no official agency such as the UK Debt Management Office should ever rely on a third party to the extent that it influences the decision to proceed with a public fiscal undertaking.
We can only hope that the DMO and indeed other UK and European agencies will review their position.
Without a doubt something so public as Friday’s outage will encourage agencies to run a dual communication system rather than potentially disadvantaging investors.
Expect reforms to follow.